The insurance claims manager formerly known as Quindell PLC is facing legal action from the law firm that bought its professional services business.
Watchstone Group PLC (LON:WTG) said the buyer of the division, Slater & Gordon, had notified it of a claim related to the deal in May last year.
Slater & Gordon had to write down £674mln in the financial year to the end of June due mainly to the acquisition.
It is trying to claw back £50mln of the purchase price of the business that was set aside in case the deal went sour.
The cash is due to be released to Watchstone on November 29.
Watchstone rebuffed the claims, saying it carried out the sale professionally and transparently.
It added that S&G was able to complete an extensive and detailed study of the division’s books.
Watchstone said: “The company does not believe there are grounds for a claim to be brought and will defend it robustly.”
Watchstone, which came under investigation by the Serious Fraud Office for historic business and accounting practices, faced an attack on its accounts by US short seller Gotham City Research when it was known as Quindell.
Shares in Watchstone fell 27.5p, or 12.7%, to 188.5p.