We outlined in edition 131 of BC Disease News how the acquisition of Quindell’s professional services division by Slater and Gordon (S&G) in early 2015, significantly contributed to its reported £577m loss and a nosedive in its shares from a high of $7.85AUD per share to its current $0.40AUD. Not long after this acquisition, Quindell, was placed under investigation by the UK's Serious Fraud Office over its past accounting practices. S&G was also hit in November 2015 when the UK government announced plans to limit volumes of personal injury claims.
It has now been reported that S&G intend to sue Quindell, now known as Watchstone Group.[i] In an announcement made to the Australian Stock Exchange earlier this week, S&G advised that it intends to bring claims against Watchstone Group Plc, arising from the purchase of Quindell’s Professional Services Division. The share purchase agreement requires S&G to notify Watchstone as soon as reasonably practicable after it has formed the view that it may have a claim, according to the announcement.
In response, Watchstone Plc made an announcement to the London Stock Exchange stating that, ‘[it] does not believe that there are grounds for a claim to be brought and will defend it robustly’.
Watchstone also said it ‘conducted a professional and transparent disposal process’ and allowed S&G the chance to complete an ‘extensive and detailed due diligence process’ on the acquisition.
Elsewhere, S&G is being sued in Australia by investors hit by the fall in the share price, while Your Legal Friend, also known as Camps Solicitors, is putting together a similar group action on behalf of investors in Quindell in the UK.