A month ago yesterday, Bill Gross sued Pacific Investment Management Co., the company he founded in 1971 and parted ways with in 2014. In his suit, Gross claimed that Pimco owes him "hundreds of millions of dollars" after being "wrongfully pushed out" of the firm by "a cabal of executives...driven by a lust for power, greed, and a desire to improve their own financial position and reputation at at the expense of investors and decency." Today in response to the lawsuit, Pimco (NYSE: PHK) asked Gross if he has any recollection of what went down at the Newport Beach office in the months preceding his departure, such as his unofficial but policy of not allowing employees to look him in the eye, docking people's pay for single typos, fining traders for standing when he thought they should sit, and calling Reuters to claim, in the wake of a negative story in the Wall Street Journal, that the source had been his former colleague Mohammend El-Erian, whose phone calls Gross claimed to be monitoring.
“During his final year with Pimco, Mr. Gross engaged in a pattern of conduct that was incompatible with the values and standards that Pimco expected of those entrusted with his leadership,” the Pimco filing says. “When Mr. Gross finally came to understand that Pimco wouldn’t exempt him from these standards, he abruptly resigned from the firm without notice or transition—disregarding the potential impact on the individual and institutional clients whose assets he was responsible for managing.”
Pimco also added that merits of the suit aside, Gross does have a promising career in film to fallback on, should the whole bond managing thing not work out.
The Pimco filing says the breach-of-contract lawsuit, filed by Mr. Gross in October, is based on a “jumbled set of contract theories” and reads “more like a screenplay than a court pleading.”
Meanwhile, Gross's attorney had this to say: “We are disappointed that PIMCO has chosen to use a procedural tactic to delay getting to the merits of the case, but are confident in our case moving forward. Notably, PIMCO's papers do not dispute the substance of Mr. Gross's allegations in any material way."
Secretariat is unbowed.
Earlier: Bill Gross Wants His God Damn Money