The two-year legal dispute between TCW Group Inc. and its former star money manager, Jeffrey Gundlach, is over.
Thursday night, representatives of TCW, Mr. Gundlach and his asset management firm, DoubleLine Capital LP, announced in separate statements that they had settled all claims in what had become one of the nastiest and most protracted legal battles in asset management history.
The terms of the settlement are confidential.
Peter Viles, a TCW spokesman, said in a statement: “We are pleased that an agreement has been reached and that this matter is now behind us.” He would not comment further. Tony Knight, a spokesman for DoubleLine, also would not comment beyond the firm's announcement of the settlement.
The settlement comes about a month before California Superior Court Judge Carl West was to rule on the amount of damages to be paid by Mr. Gundlach and DoubleLine to TCW. A jury on Sept. 16 had found that Mr. Gundlach and DoubleLine were liable for stealing trade secrets from TCW.
TCW Group had been seeking $81.7 million in “reasonable royalties,” for the taking of the trade secrets, but an expert witness for DoubleLine had estimated the value to be as low as $2.3 million during a post-trial hearing.
TCW fired Mr. Gundlach in December 2009, accusing him and key associates of stealing millions of documents and data to help start DoubleLine. Mr. Gundlach insisted throughout the six-week trial that began in late July that it was TCW executives who had plotted to get rid of him and to deprive him and his team of at least $500 million in back wages and compensation.
While Mr. Gundlach and his associates did not deny at the trial that trade secrets were taken, they insisted they were never used by DoubleLine.
The jury ended up awarding Mr. Gundlach and the three other defendants a combined $66.7 million for unpaid wages.
It is not known if those back wages will be paid under the terms of the settlement or whether TCW will receive any money from its trade secrets claim.
The trial jury in Los Angeles also found that Mr. Gundlach had breached his fiduciary duty to TCW and interfered with the company's contractual relationships, but awarded no damages on those charges.
Sources said part of the rationale for a settlement was to stop the tens of millions of dollars of legal costs that both sides had accumulated, noting that appeals could have continued the case through 2012 and 2013.