I don't know how much cause you have to show or exactly what kinds of legal proceedings would surely be instigated, but I'm pretty sure the PL can vote to kick a club out with the support of 75% of the members.
That's the ultimate nuclear option but I really do wonder whether some of the owners might start leaning that way if they lose this case. City's position ultimately boils down to the proposition that they can flout the spending rules completely, in a way that massively advantages them over any other club, and the league cannot stop them or impose regulation. Not only does that threaten to destroy competition within the PL, thereby devaluing the product, but it puts the rest of the league in a position where they need to lose money to have a chance at competing. Its just ruinous from a business perspective.
Basically, I think this is existential for the Premier League. That doesn't necessarily mean kicking City out is the only option in response (the anchoring rule may be an alternative, as I mentioned previously). But they're not going to just do nothing if City wins this fight because they can't afford that. The owners collectively have way too much invested.