'Bond King' Gross: I Did Not Quit Pimco
Bond fund manager Bill Gross on Tuesday accused Pacific Investment Management Co of falsely claiming he suddenly decided to abandon the firm he co-founded in an effort to win dismissal of his $200 million breach-of-contract lawsuit.
In papers filed in state court in Orange County, California, Gross said Pimco's "misconduct" cost him substantial sums he earned and led to a "tarnishing of his stellar lifelong reputation."
Gross, long known as the "Bond King" for his years at Pimco when he oversaw what was then the world's largest bond fund, also accused Pimco of misconstruing his allegations when it sought to throw out his case in November. Pimco, he said, hoped to bait the court into making "inappropriate factual determinations" and lead the court to dismiss the lawsuit quickly.
"We continue to believe that this lawsuit has no merit, and we will be responding in court in due course," David Boies, a lawyer for Pimco, said in a statement.
Pimco, a unit of German insurer Allianz SE, is based in Newport Beach, California.
Gross now works for Janus Capital Group Inc, where he runs the $1.3 billion Janus Global Unconstrained Bond Fund.
Gross filed suit against Pimco in October, claiming that executives like Daniel Ivascyn, his successor as group chief investment officer, plotted to oust him so others could divvy up a back-loaded annual bonus expected to top $250 million.
Forbes magazine estimates Gross' net worth at $1.95 billion.
Gross' sudden departure in September 2014 followed months of negative reports about his management style and weak performance at Pimco Total Return, which he had built into the world's largest bond fund by assets, a ranking it no longer holds.
Gross on Tuesday said his ouster followed "endless misleading, false and inaccurate assaults in the press led by members of the executive committee," and came even after he offered to give up some pay and responsibilities.
"Defendants now seek to avoid the consequences of their actions by falsely claiming that Mr. Gross suddenly decided to abandon the company that he founded," he said.
A hearing is set for March 14.
The Janus Global Unconstrained Bond Fund has returned 0.87 percent so far this year, according to Morningstar Inc.
Total Return has about $89.3 billion of assets, less than one-third its peak of $292.9 billion three years ago. It has returned 0.34 percent to date in 2016, Morningstar said.
The case is Gross v. Pacific Investment Management Co et al, California Superior Court, Orange County, No. 2015-00813636.
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