The younger brother of former City keeper Cameron, joined Liverpool on a three year deal with the Scousers beating off the likes of Manchester United to gain his signature.
The move is likely to go to a tribunal following reports that City have turned down Liverpool's compensation offers.
City Chairman Ray Ranson was not at all happy and told the CT: "It is very difficult to hold on these boys.
"People talk about giving the smaller clubs incentives to develop players without fear of them being taken for nominal fees, so something needs to be done.
"Daniel Sturridge is a classic case and it is time smaller clubs got some protection because it is going to keep happening."