SLATER & GORDON FACES THIRD MAJOR LEGAL CLAIM ARISING FROM ITS BILLION DOLLAR FALL FROM GRACE

SLATER & GORDON FACES THIRD MAJOR LEGAL CLAIM ARISING FROM ITS BILLION DOLLAR FALL FROM GRACE

EMBATTLED law firm Slater and Gordon (ASX: SGH) is facing another legal battle with one of its shareholders announcing it will commence proceedings alleging the company produced misleading full year results for three years in a row.

Slater and Gordon, already facing the potential for two class actions from disgruntled shareholders, confirmed it received a letter from Johnson Winter & Slattery Lawyers (JWS) saying it was acting on behalf of a shareholder, Babscay Pty Ltd, and that it intended to begin legal proceedings.

"While full details of the proposed claim have not been provided, the letter from JWS sets out the claim will be based on allegations the company's financial statements in each of the financial years ended 30 June 2013, 2014 and 2015 contained misleading representations," the company says.

Slater and Gordon says no details were included in Babscay's letter and no claim has been filed or served on the company.

In April, ACA Lawyers issued a formal letter of demand to Slater and Gordon MD Andrew Grech, laying the foundation for a class action.

ACA became the second firm to begin a class action after Maurice Blackburn started its own proceedings on behalf of 3,000 shareholders alleging Slater and Gordon failed to disclose vital information relating to the acquisition of professional services business, Quindell in the UK.

Slater and Gordon's spectacular fall from grace has seen its market value fall from $2.8 billion in April 2015 to just $32 million as a result of the disastrous acquisition of Quindell which cost $1.2 billion.

In May, Slater and Gordon's UK subsidiary announced it would lodge a $1 billion fraud claim against the company from which it bought Quindell, alleging Watchstone Group made "fraudulent misrepesentations" over the purchase.

SGH shares are trading at 9.4 cents, just over one per cent of their value of $8.07 in April 2015."

Never miss a story: Sign up to Business News Australia's free news updates

Follow us on Twitter, Facebook, LinkedIn and Instagram

Enjoyed this article?

Don't miss out on the knowledge and insights to be gained from our daily news and features.

Subscribe today to unlock unlimited access to in-depth business coverage, expert analysis, and exclusive content across all devices.

Support independent journalism and stay informed with stories that matter to you.

Subscribe now and get 50% off your first year!

Four time-saving tips for automating your investment portfolio
Partner Content
In today's fast-paced investment landscape, time is a valuable commodity. Fortunately, w...
Etoro
Advertisement

Related Stories

Fashion retailer Accent Group to cut Glue Store location count in half

Fashion retailer Accent Group to cut Glue Store location count in half

The ASX-listed fashion retailer responsible for such brands as Plat...

Domino's to shutter 100 stores after crusty results

Domino's to shutter 100 stores after crusty results

The board of Domino's Pizza Enterprises (ASX: DMP) waited until...

Wing enters largest Australian drone delivery area to date through Melbourne launch with DoorDash

Wing enters largest Australian drone delivery area to date through Melbourne launch with DoorDash

Alphabet-owned drone delivery company Wing has announced its entry ...

Accolade Wines owner buys French giant Pernod Ricard’s global wine assets

Accolade Wines owner buys French giant Pernod Ricard’s global wine assets

Australian Wine Holdco, a consortium that owns the country’s ...