Former New Zealand Warriors coach Daniel Anderson is set to drop legal action against the NRL after it stood him down from rugby league following the Parramatta salary cap scandal.

Anderson, the Eels' head of football operations, and four other Parramatta officials were suspended by the NRL in the wake of the club's massive salary cap breaches.

News Corp Australia reported today that all five officials are set to drop legal action against the governing body this week.

With the case relating to the group's provisional bans due to return to the Supreme Court on Tuesday, discussions between the officials and the NRL continue to head towards a possible resolution.


According to News Corp, the only issue is said to be an agreement on who will fund the governing body's legal costs.

The development comes just days before Anderson, Eels chairman Steve Sharp, directors Tom Issa and Peter Serrao and chief executive John Boulous due to formally respond to the NRL over their deregistration.

Parramatta have until Friday to respond to the NRL's breach notice for alleged systematic salary cap cheating, which include the proposed loss of 12 competition points and a $1 million fine.

The Eels have not won a match since the notice was handed down, meaning unless they beat Newcastle on Monday night, they will likely drop back to last on the NRL ladder when sanctions are confirmed.