Last month at the High Court in Manchester, Judge Bird granted permission for the parents to proceed to a full hearing of the judicial review.
In his ruling the judge said that if he refused permission, 'There could be a real risk of causing real injustice.'
As we reported in April, the council has stopped £3.6m in grants to the nurseries, putting their survival at risk.
Sheffield City Council has claimed that a cut of £6.8m to the Early Intervention Grant forced it to stop the funding at the end of March.
The two-day court hearing takes place on 29 and 30 July and a judgment is expected soon afterwards.
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