Jeffrey Mayberry, a former TCW senior vice president, testified Tuesday that he never used information that he downloaded from TCW at his new firm, DoubleLine Capital, on orders of DoubleLine's senior finance officer at the time, Greg Ward.
Mr. Mayberry's testimony in California Superior Court in Los Angeles goes directly to one of the central questions in the trial that pits TCW against DoubleLine and its founder, former TCW Chief Investment Officer Jeffrey Gundlach — whether trade secrets from TCW were stolen to help launch DoubleLine. TCW is charging that Mr. Gundlach and key associates, including Mr. Mayberry, stole company trade secrets and downloaded millions of documents before they were fired in December 2009.
On Monday, Mr. Mayberry testified he and associates had downloaded the TCW information for possible use at a new firm in case Mr. Gundlach was fired. But under cross-examination from DoubleLine lawyers, Mr. Mayberry said Tuesday that no information was ever used in building DoubleLine because of a memo received in mid-December 2009 from Mr. Ward. Mr. Ward sent the memo after being contacted by TCW attorneys demanding the return of the downloaded information, according to court filings. DoubleLine had also begun a program to return the information to TCW at the time, according to DoubleLine's complaint against TCW. Mr. Ward is no longer at DoubleLine.
Mr. Mayberry also disclosed that he was suspended from DoubleLine in February 2010 after DoubleLine officials learned he had not returned a thumb drive he had used to download the TCW files before being dismissed from TCW in early December 2009.
On Tuesday, Mr. Mayberry testified he did not know what happened to the thumb drive. He said he mailed it to his parent's car dealership after refusing to turn it over to TCW security investigators in early December 2009. He said he sent it to the dealership for safe keeping until he could determine what to do.
There was a hole in the envelope when it arrived at the dealership and the thumb drive was missing, Mr. Mayberry testified.
Later Tuesday, Barbara VanEvery, former TCW senior vice president, admitted in testimony that promotional material that she wrote as director of communications for DoubleLine seemed copied from her old firm.
Confronted by TCW attorneys with wording for institutional clients that seemed identical in promotional material for both firms, Ms. VanEvery blamed it on a subordinate and said she should have checked the copy.
DoubleLine's promotional material was distributed to investors in the first months of Mr. Gundlach's new firm.
Ms. VanEvery also admitted she was looking for office space to enable Mr. Gundlach to start a rival money management firm in October 2009, at least two months before he was fired from TCW. But she told the court under questioning from TCW's lawyers that Mr. Gundlach was just trying to put in place a plan in case they were fired.
“I was under the impression that something was going to happen by December,” Ms. VanEvery testified. “It was coming to a head. I felt there was going to be some kind of separation.”