First it was the protagonists in SBS’s controversial documentary Struggle Street threatening to sue the producers, but in an interesting turn of events the producers are now threatening to counter-sue.

The documentary, which proved a ratings bonanza for the public broadcaster on Wednesday night, is supposedly a ‘fly on the wall’ doco of life in a public housing estate in Sydney’s west.

However, it caused such a stir the area’s Mayor, Stephen Bali, slammed it calling the three-part series an utter misrepresentation of the area and labelling it “poverty porn”. The participants also claimed they’d been lied to about their roles in the program and threatened to sue for defamation.

But in an interesting twist to the ongoing saga, it’s been reported in The Guardian this morning that the film’s producers, Keo Films, are to take legal action against Mayor Bali who claimed they’d acted unethically and illegally in making Struggle Street.

SBS – who are revelling in the massive PR for the show and the accompanying ratings – have not threatened any legal action nor are they able to do so because they are government funded.

Keo on the other hand are said to be incensed by Mayor Bali’s comments that scenes in the documentary were fabricated and Keo employees allegedly bought drugs for participants in the show.

The SBS is said to have investigated Bali’s allegations before the program’s airing and found none of it to be true.

On Wednesday it dismissed all of Bali’s allegations and forwarded the Mayor a letter that read: “The allegations that members of the production team aided or abetted or were in any way involved in the commission of alleged criminal offences are seriously defamatory and we are advised are absolutely denied by the production team involved. The serious, defamatory and damaging allegations made regarding the production team asking participants to ‘create scenes’ are absolutely false.”