Craig Thomson's new solicitor, Chris McArdle, has issued his first defamation threat over the suggestion that his embattled client used union funds to pay for prostitutes.

''Our client has never used other people's money or his own money to pay people for sex with him. Anyone who says the opposite will be sued,'' Mr McArdle said.

Illustration: Rocco Fazzari

Last week Katrina Hart, a branch president of the Health Services Union, took up the challenge.

''Craig Thomson, you are a liar, you paid for prostitutes with my money and the money of every other HSU member. You [took] $100,000 from us. I dare you to sue me,'' said Ms Hart, in The Daily Telegraph last week.