“Realize that you have nothing to fear from the truth.” It’s right up there at the top of Bridgewater Associates founder Ray Dalio’s Principles, just after “trust in truth” and immediately preceding “have integrity,” “be radically transparent” and “don’t tolerate dishonesty.” Nowhere, not even in a lettered or sub-numbered sub-principle, do we find “make things up when convenient” or “ignore the contents of the Bridgewater Blockbuster if it does not help make your point.”

A three-arbitrator panel found on July 1 that Bridgewater had fabricated evidence, withheld evidence and disregarded its own records in pursuing its claims, according to a July 13 filing by the former employees’ attorneys. The filing in New York State Supreme Court recounted aspects of the arbitration and summarized portions of the panel’s finding…. Bridgewater brought its claims “not to prove misappropriation, but rather, to adversely affect [Messrs. Squire’s and Minicone’s] ability to conduct a competitive business,” the filing said the panel found.

At issue before the arbitrators was Squire and Minicone’s founding of their own hedge fund, Tekmerion Capital Management, and whether it had used the secrets found deep in Dalio’s Cave of Contemplation to get it off the ground and get the likes of Mike Novogratz and Alan Howard to invest. The panel, after two years of discovery, eight days of hearings and “voluminous post-hearing briefing” found that they had not, and also that Bridgewater owed its former charges nearly $2 million for their trouble.

The panel further found the trade secrets Bridgewater alleged its former employees had violated were publicly available or “generally known to professionals in the industry.”

Now there’s a truth to fear: That the Svengali of Westport has no Principled proprietary practices to charge such lavish fees on that $140 billion.

Bridgewater Loses Claims It Brought Against Ex-Employees Who Launched Hedge Fund [WSJ]

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