Lance Armstrong seemed already to have lost all there is to lose but this is not quite the case.

To date, he has been stripped of all his achievements from August 1998 onwards, including his seven Tour de France victories; he has been banned from all WADA-sanctioned competitions; he has lost a raft of sponsors; and he has been forced to admit publicly to having doped after having denied the accusations vociferously year after year.

Since his remarkable confession to Oprah Winfrey of having taken performance-enhancing drugs, the American has had to take a significant financial hit.

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Most of his sponsors dropped him like a hot potato almost as soon as the interview was aired; Armstrong described the 24-hour period after that now-infamous interview as a $75m day, so much did he lose in endorsements in that short period as Nike, Oakley, Trek and Anheuser-Busch jumped ship.

So far, Armstrong's biggest financial blows have been the potential earning opportunities that have been snatched from his grasp but that may be about to change. Yesterday, a legal case began which, if Armstrong loses it, will leave him having to pay out $12m in one fell swoop.

Armstrong is up against Texas-based SCA Promotions, a company who call themselves "an international marketing service firm specialising in Promotional Risk Coverage and Technology Solutions for Sweepstakes and Games", including hole-in-one events and sports and media contests. The outline of the case is this: Tailwind Sports, the owners of the US Postal team for which Armstrong rode during his career, took out an insurance policy with SCA Promotions in 2000 to cover performance bonuses that would be due to the rider were he to win further Tours de France; the American having already won the event in 1999 and 2000.

SCA Promotions are no mugs. Their president is Bob Hamman, a 12-time world bridge champion who founded the company in the 1980s and went on to make them the world's largest of their kind. When Tailwind Sports approached Hamman asking for odds on Armstrong winning the Tour de France from 2001 to 2004, Hamman did some calculations and decided there was a 23-1 chance that Armstrong would win those four Tours. One vital piece of information that Hamman was ignorant of was that Armstrong was doped up to his eyeballs and so the odds of him winning seven consecutive Tours, as he did, were much lower than Hamman estimated.

As it turned out, Armstrong did win all four Tours from 2001 to '04, meaning that SCA Promotions were forced to pay out $9.5m to the rider. This is a painfully large sum of money for any company, but Hamman was all the more miffed as he was convinced that Armstrong's final victory was achieved with the help of doping. Hamman withheld the last bonus payment of $5m which was due to Armstrong as a result of that 2004 win but, when the rider took him to court, Hamman was forced to pay the $5m plus an additional $2.5m in costs as Armstrong was, officially, the winner of the race. "It's over," said Armstrong at the time.

"We won. They lost. I was, yet again, completely vindicated."

This has all changed, of course. Following the investigation by the US Anti-Doping Agency, Armstrong was convicted of doping offences and stripped of his seven Tour titles, no longer the official winner of the race. Armstrong, Hamman and their legal teams went in front of an arbitration panel yesterday in a case which is expected to last three days. By the end of the case, Armstrong, it seems likely, will be $12m lighter.

It is hard to see how the American could possibly lay claim to the bonus money which he was paid, even if, as I believe, he has been made something of a scapegoat for the entire doping era of cycling.

He was not the only rider who doped, nor were US Postal the only team who employed a systematic doping programme. Some of the treatment meted out to Armstrong has been disproportionate; he doped, just as did countless other riders in that period, but the American has been forced to bear almost all of the blame as a result of his dominance of the sport.

For all the inordinate criticism, though, Armstrong should not be allowed to benefit financially as a result of having cheated and lied. Just as he believed that his reputation would never be tarnished with doping convictions, it is likely that he thought his fortunes were safe. That, too, may change in the next day or two.