Bond manager Bill Gross will be able to pursue his lawsuit to recoup at least $200 million he claims that Pacific Investment Management Co. owes him in the wake of his 2014 ouster from the firm he co-founded.
California Superior Court Judge Martha Gooding ruled late Sunday that Gross’ breach-of-contract lawsuit was strong enough to proceed.
The Santa Ana-based judge said Gross “alleges sufficient facts based on allegations concerning his status as the founder, a 40-year history, an alleged track record of bringing success and/or fame to the enterprise, as well as a series of alleged oral promises/assurances of continued employment.”
Gooding’s ruling had been tentative, and a scheduled hearing on the matter was canceled as a result. The judge did not rule on the lawsuit’s merits.
David Boies, a lawyer for PIMCO, said: “PIMCO is confident that it will prevail when the parties present their evidence to the court.”
Gross abruptly left PIMCO in September 2014 following negative reports about his management style and weak returns at PIMCO Total Return, which he had built into what was at the time the world’s largest bond fund.
He sued PIMCO in October 2015, claiming that executives plotted to oust him and divide his bonus among themselves.
PIMCO has said Gross had no employment guarantee and could have been fired at any time without cause.
The Newport Beach, California-based unit of German insurer Allianz SE has until April 4 to file a formal answer to Gross’ lawsuit.
Patricia Glaser, a lawyer for Gross, said: “We are very pleased with the court’s ruling and are looking forward to the opportunity to prove our case in court.”
Gross, 71, now manages the $1.3 billion Janus Global Unconstrained Bond Fund for Denver-based Janus Capital Group Inc.
A large portion of the fund’s assets comes from Gross, whose net worth is $1.95 billion, according to Forbes magazine.
Gross has said he will donate proceeds from the PIMCO lawsuit to charity.
The case is Gross v. Pacific Investment Management Co. et al, California Superior Court, Orange County, No. 2015-00813636.
(Reporting by Jennifer Ablan and Jonathan Stempel in New York; editing by Chris Reese and Dan Grebler)