A California Superior Court judge threw out the most salacious accusations against Jeffrey Gundlach, former CIO of TCW Group, made by his former employer.
The ruling by Los Angeles Superior Court Judge Carl West came just days before jury selection begins in the trial that pits Mr. Gundlach and his firm, DoubleLine Capital, against TCW.
In his ruling on July 21, the judge said the accusations — which he called “collateral evidence” — would distract from the issues of fraud, proprietary theft and damages stemming from Mr. Gundlach’s termination at TCW.
TCW officials claim they found sex toys, pornographic magazines and videos and marijuana in Mr. Gundlach’s office after he was fired in December 2009.
Jury selection is expected to start July 25 in the trial between TCW and Mr. Gundlach. TCW charges that Mr. Gundlach stole company secrets, including client lists and investment programs that he used to help establish DoubleLine.
Mr. Gundlach denies the allegations and is countersuing, maintaining that TCW owes him more than $500 million in back wages.
Lew Phelps, a spokesman for DoubleLine. did not comment directly on the evidence ruling, but in a statement said the trial will ”expose the plot” by TCW to “fire Jeffrey, cheat him out of his compensation and steal all his profits.”
Attorney Susan Estrich, who is part of the TCW legal team in the case, downplayed the judge’s decision. “The heart of this case is and always has been Mr. Gundlach’s theft of trade secrets and confidential information from TCW, and his betrayal of the trust placed in him by his former employer and its investors,” she said in statement.