Former NSW State of Origin winger James McManus is taking legal action against the Newcastle Knights over the NRL club's handling of the concussions that led to his retirement.

Fairfax media report that the case, which begins with a directions hearing in the Supreme Court next month, could result in more actions being taken against sporting clubs and bodies for negligence.

McManus made all of his 166 NRL appearances for the Knights but his career came to a premature halt after suffering the last in a series of concussions in the round-20 loss to South Sydney in July of 2015.

McManus sat out the remainder of that season and didn't play again, officially announcing his retirement from the game on medical grounds in August of last year.

Advertisement

The 31-year-old is currently employed by the club in an off-field role as a business development executive.

Newcastle confirmed on Sunday morning that they were working through the matter in conjunction with the NRL.

Knights chairman Brian McGuigan said the club respected McManus' right to sue, but would be defending its handling of his concussions.

"Players have got to be approved to go back on the ground by the doctors, the medical staff," McGuigan told Fairfax Media.

"If he is deemed to be fit, all we do is abide by that, all we have ever done is abide by that.

"We have never put anyone under pressure to go back on the field were they not approved by the medical staff as being ready to go back on the field."

McGuigan also said the legal action would have no impact on McManus' current position at the NRL club. The NRL is not commenting on the matter.

- AAP