The High Court in Manchester has ordered the club to pay Berg £2.25million in compensation for the two and a half years remaining on his contract.
Berg was sacked following a 57-day reign in which he managed to win just one of the ten games he took charge of.
Blackburn's barrister had argued that the club was "out of control" and managing director, Derek Shaw, had no right to give Berg a contract that entitled him to a full pay out if he was sacked.
But that did not wash with the Judge who ordered club owner's Venkys to cough up. Berg had been paid £560,000, Rovers have to pay a further £843,000, and £20,000 costs.
So it pays to take the cheap option ... Not.