Quindell eyed for group legal action by rival law firm Your Legal Friend
Embattled insurance outsourcer Quindell is being eyed for potential group legal action by a rival law firm Your Legal Friend.
Liverpool-based Your Legal Friend, which was formerly known as Camps Solicitors, is appealing for investors burnt by their investment in Quindell to get in touch.
The company's share price has lost around 75 per cent in the three months from mid-September.
It said it is investigating and "advancing plans to launch a class action on behalf of affected shareholders."
Colin Gibson, chief operating officer of Your Legal Friend said:
We are very concerned that many shareholders and former shareholders have suffered investment losses which may be directly attributable to statements by the company and its Board that have proved to be extremely misleading.
Quindell declined to comment.
Group law suits – which lets different people with the same potential claim team up against a company – are more difficult to launch in the UK as opposed to the US. Here you have to find enough people to opt-in but the US has more of an opt out system.
Quindell has suffered since the publication of a controversial paper from mysterious US short seller Gotham City Research in April. The researcher, named after the caped crusader Batman's home town, published a 74-page dossier accusing the company of having "magical … paper profits".
Earlier this month former chairman Rob Terry sold off most of his remaining stake sending shares plummeting by almost half their value. Its stock was also rocked by the news that audit giant PWC would carry out an independent review into Quindell's accounting practices.
This followed Terry and non-executive director Steve Scott stepping down last month, shortly after it was revealed the company's broker Canaccord Genuity had resigned in October. Fidelity, one of the world's largest investors, has also halved its stake in Quindell.