TCW Group wants a judge to throw out breach-of-contract claims by its former investment chief, Jeffrey Gundlach, who said he was fired in 2009 so the company wouldn’t have to pay him as much as $1.25 billion in fees.
Lawyers for TCW will present arguments Monday to Los Angeles Superior Court Judge Carl West that Mr. Gundlach can’t claim breach of contract because he had no contract at the time he was fired. TCW wants Mr. Gundlach’s claims removed from the case before it goes to trial next month.
TCW, a unit of Societe Generale, sued Mr. Gundlach and three other ex-employees in January 2010 after more than half of its fixed-income professionals joined Mr. Gundlach’s new firm, DoubleLine Capital. TCW seeks more than $200 million in damages, claiming Mr. Gundlach stole its trade secrets as he plotted to start his own business.
Mr. Gundlach filed counterclaims a month later, saying he was dismissed so TCW wouldn’t have to pay $600 million to $1.25 billion in future management and performance fees from the funds his group managed.
“The ‘truthful answer’ to the billion-dollar cross-complaint is that Gundlach was not under contract with TCW in 2009: he was an at-will employee,” TCW said in a March 4 request for summary judgment.
Mr. Gundlach at Monday’s hearing will ask the judge to rule that some of TCW’s claims against him, breach of duty of confidence and violations of California’s penal code, are pre-empted by California’s Uniform Trade Secrets Act and shouldn’t proceed to trial. The jury trial is scheduled to start July 25.