Five major law firms are going into battle for the right to act for disgruntled shareholders following revelations in the financial services royal commission that financial giant AMP deliberately mislead regulators.

The resulting fallout saw AMP chair Catherine Brenner and CEO Craig Mellor lose their jobs – and shareholders lose over $2 billion as shares tanked in the wake of the revelations.

Now its moving to lawyers at 10 paces as law firms drum up aggrieved shareholders to launch class actions. So attractive is the prospect of running a class action that five major firms are contending to do it.

They are Maurice Blackburn, Slater & Gordon, Shine, Quinn, Emmanuel, Urquhart and Sullivan and Phi Finney McDonald. The are all backed by major litigation funders, companies with big balance sheets who take a punt on funding class actions for a slice of the settlement if they win.

There is no surprise in the fact that the big legal guns are battling for a slice of the action. The fees they can earn from class actions are massive.

Maurice Blackburn, for example, walked away with more than $100 million for running two successful class actions for the victims of the 2009 Black Saturday bushfires in Victoria. That came out of the $794 million awarded to the victims.

The award by the courts to the lawyers spurred one fire victim, Garry Angus, to observe “The only winners out of this have been Maurice Blackburn”.

Slater & Gordon earned $10.06 million in fees from the largest shareholder class action, the $200 million Centro Properties case while Maurice Blackburn earned $21 million from the same case. Maurice Blackburn also reaped $12.5 million from the $144.5 million Aristocrat Leisure settlement.

The ultimate size of the AMP settlement is just a guess at this point. But lawyers involved told The New Daily it could be larger than the record-setting Centro case.

One report suggested it could be as much as $1 billion, given that more than $2 billion has been wiped off the AMP share price since the scandal broke in April. The litigation funders are paid a percentage of the settlement, so would be heading for a fat payout even if the compensation totals only half that.

Only two of the five law firms have formally lodged their papers with the court to date but the other three have said they will. Once the papers are registered there will be a “beauty contest” with a judge looking at their proposals to see which one serves AMP shareholders best.

Criteria used will include the fees to be charged, the proposed legal strategies to be employed, the fire power of the legal teams to be employed and the number and makeup of the shareholders signing up. Some have already cut fees to make sure they stay in the race.

It will be open to all AMP shareholders who have lost money to sign up with the class action. But ultimately you only get one bite at the cherry and can only have losses compensated by one class action.