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Nuix’s defence statement says it “remains bound by the consent judgment” to record Mr Sheehy’s equity interest as a right to receive only 453,273 Nuix shares.

Meanwhile, documents lodged by Mr Sheehy’s legal team from Kardos Scanlan say the consent judgment was merely to determine the expiry date of Mr Sheehy’s options not any conversion rights.

“The number of shares to which the applicant was entitled upon exercise of the remaining 2008 options was not part of the subject matter of the dispute in the 2018 proceedings,” sthe notice of filing on behalf of Mr Sheehy says.

Nuix investor, Ausbil Investment Management’s Mason Willoughby-Thomas, says he has no view on the merits of the case but points out that the prospect of a Sheehy victory was covered off in the prospectus.

“The IPO was priced on a post-dilution basis ... so that was specifically taken into account in the IPO process, and in the way that we have valued it ourselves,” he said.

However, the issue for Nuix will be that its recent share price plunge will add to the potential damages Mr Sheehy might win. This cost, potentially in excess of $100 million, has not been factored into Nuix’s prospectus.

Despite the prospect of a lengthy legal stoush between Nuix and Mr Sheehy and doubts about whether it can meet its full-year guidance, Ausbil still likes the investment case for the company.

“You’ve got unique IP-based competitive advantages and a leadership position in the market, particularly around the Nuix engine, which is the core of their offering,” Mr Willoughby-Thomas said.

“You’ve got a large and growing addressable market, and the company’s profitable ... so there’s still a lot to like.”

However, he’s not expecting a quick rebound in Nuix’s share price, saying the current state of the bond market may now be the key issue weighing down the stock.

“I’m pretty sure that that didn’t help their cause with the whole sector experiencing a reasonably significant de-rate,” Mr Willoughby-Thomas said. “A lot of tech companies have fallen 30 to 40 per cent since the jack up in bond yields.”

The matter between Nuix and Mr Sheehy is back before the courts next month.