The old wounds between Cronulla and Chris Anderson have reopened after the Sharks confirmed their former coach has started legal action for unfair dismissal.

Cronulla president Barry Pierce said the Sharks had been served papers by Anderson's legal team on Friday afternoon in response to his sacking at the end of last season.

However, Pierce said the club was "extremely confident" it would be able to defend itself against any legal challenge.

It's understood Anderson, who was on Thursday linked with a coaching director's role at South Sydney, is seeking more than $1 million as compensation for the club's decision to terminate his $400,000 a year contract.

Anderson had one year left on his deal as well as an option for another two seasons if the club made the finals in 2004.

Pierce said the club's lawyers were confident the Sharks, who appointed Stu Raper as Anderson's successor, were in a strong position.

"Papers were served on our lawyers today," Pierce said.

"The papers were served with regard to his contractual claim of unfair dismissal and we will be vigorously defending it. We're extremely confident.

"I can't say much more but we will be vigorously defending it and on senior counsel advice we think we're in a very good position."

Anderson's manager George Mimis was unable to confirm legal action had commenced.

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