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Rating:TCW Returns to Court to Demand $81.7 Million in Royalties Not Rated 0.0 Email Routing List Email & Route  Print Print
Wednesday, October 26, 2011

TCW Returns to Court to Demand $81.7 Million in Royalties

News summary by MFWire's editors

The ongoing saga of TCW versus DoubleLine continues. Both Jeff Gundlach's team and Trust Company of the West (TCW [see profile]) returned to court yesterday, and TCW asked the judge to award the firm $81.7 million in royalties. The next hearing, which will include witnesses for TCW, is scheduled for November 21.

To read the rest of the story of the fight between Gundlach and TCW, click here.

Bloomberg, Pensions & Investments and Reuters all covered the latest hearing.

Yesterday's hearing follows the delivery of the jury verdict's on September 16. The jury award the DoubleLine Capital [see profile] team $66.7 million in back pay, agreed that Gundlach and his colleagues breached their fiduciary duty but declined to award damages to TCW, and agreed that the DoubleLine crowd stole TCW trade secrets while deferring the sentencing on that count to the judge.

TCW's $81.7-million claim stems from the testimony yesterday of expert witness Bradford Cornell, who claimed that Gundlach wouldn't have been able to build out DoubleLine so quickly without using TCW's trade secrets.

DoubleLine spokesman Lew Phelps countered that the Societe Generale subsidiary "is living in an alternative universe."

"They are seeking royalties based on a draft that envisioned TCW negotiating with Jeffrey Gundlach to continue to manage $48 billion in assets as part of an amicable separation," Phelps told Reuters. "Instead, TCW fired Jeffrey, and he built DoubleLine from scratch, without a penny from TCW."

Meanwhile, P&I reports that the judge may hold another hearing separate from the trade secrets claim, as TCW wants to challenge the $66.7-million the jury awarded to Gundlach and his colleagues. 

Edited by: Neil Anderson, Managing Editor

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