Pimco says had 'good cause' to fire Bill Gross: filing

Mon Apr 4, 2016 7:01pm EDT
 
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By Jonathan Stempel

(Reuters) - Pacific Investment Management Co said former bond manager Bill Gross' abusive conduct and effort to sabotage colleagues he deemed disloyal gave it "good cause" to oust him, and not pay any of the more than $200 million of damages he now seeks in a lawsuit.

In a Monday filing with the California Superior Court in Santa Ana, Pimco also said Gross acted unprofessionally when he "abruptly quit" the firm in a handwritten scrawl left behind in the middle of the night for colleagues to find the next morning.

The Newport Beach, California-based firm's response ratchets up the legal dispute that began last October when Gross sued Pimco, accusing executives of plotting to oust him from the firm he helped found more than 40 years ago and divide up his bonus.

Patricia Glaser, a lawyer for Gross, said in response that the lawsuit targeted a "money grab" by Pimco executives who wanted "a bigger piece of the pie - the piece that based on his contract belonged to Bill."

Gross, a billionaire, is now a portfolio manager for Denver-based Janus Capital Group Inc, and has pledged to donate proceeds from the lawsuit to charity. Janus said the lawsuit is a personal matter for him.

Pimco is a unit of German insurer Allianz SE.

Gross left Pimco in September 2014 amid negative reports about his leadership and weak returns at Pimco Total Return, once the world's largest bond fund. He now runs the $1.3 billion Janus Global Unconstrained Bond fund.

In its filing, Pimco said Gross' own "self-destructive behavior" would have justified his firing, and included his "breaking commitments to abide by management decisions, trying to sabotage the careers of the former CEO and others he suspected of disloyalty, and treating his colleagues abusively."   Continued...

 
File photo of Bill Gross speaking at the Morningstar Investment Conference in Chicago, Illinois, June 19, 2014. REUTERS/Jim Young/Files