Mum and dad investors deserve to be compensated over Slater and Gordon's poor performance and massive share price losses, according to a rival law firm that wants to sue.
Maurice Blackburn Lawyers announced on Wednesday it was opening registrations for aggrieved shareholders of the publicly-listed company interested in pursuing a class action, prompting a share price fall.
Slater and Gordon has lost almost 90 per cent of its $2.75 billion market value on the Australian stock exchange since April, following its acquisition of Quindell for about $1.3 billion.
At the time, it said the acquisition would increase earnings per share by more than 30 per cent in the first year.
Maurice Blackburn's class actions principal Jacob Varghese said he had received a consistent stream of calls, emails and social media contact from shareholders, whether it be mums and dads or retail and institutional investors, since June.
He said the class action will be about the timeliness of the release of information on five occasions between April and December 2015.
"It beggars belief that the company could have this happen to them five times in a year," he told reporters on Wednesday.
"We wouldn't take this step if we didn't think there were serious questions to answer and shareholders don't deserve a remedy."
The company's shares fell on Wednesday after this second threat of legal action against Slater and Gordon in the past week and were trading around 93.5 cents on Wednesday.
Shares in the company hit an all-time high of $8.07 in April before slumping to an all-time low of 59.5 cents in November over concerns about its UK business and revisions to its financial reports.
The shares had tumbled last week after it dumped its earnings guidance for this financial year due to its UK business performing below expectations.
The $890 million April capital raising involved issuing shares to investors at $6.37 each.
Slater and Gordon is being investigated by the Australian Securities and Investments Commission after the law firm said it had found errors in financial accounts.
Sydney-based firm ACA Lawyers is considering a separate class action against Slater and Gordon for potentially misleading the market over an $890 million shareholder raising to acquire Quindell's professional services business in the UK, and profit forecasting for the 2016 financial year.
Slater and Gordon say it's yet to be notified of any legal proceedings.
