Jury Says Gundlach Liable for Trade Secret Theft, But Awards Him $67 Million on His Counter-Suit

The New York Times is reporting that the California jury in the case between TCW and Jeffrey Gundlach and his associates has ended with the jury concluding Mr. Gundlach did technically misappropriate trade secrets but awarding his former employer nothing in damages. TCW was also found liable to Gundlach for back-pay the jury believed they wrongfully withheld from Mr. Gundlach. This is, and these are your bloggers speaking now, a pure split-the-baby outcome for both sides.

In finding Mr. Gundlach liable for misappropriating trade secrets and violating fiduciary duties he had to TCW but awarding TCW no damages, the jury must have concluded that the theft of trade secrets was not the cause of TCW's lost business to Mr. Gundlach. We are just speculating here but it seems likely that the jury concluded that it was Mr. Gundlach's skill as a fund manager, not his ability to communicate directly with TCW's former clients about his departure, that led to the clients leaving and joining him at his new firm. In other words, the misappropriation of trade secrets and fiduciary breaches were NOT the cause of the lost business and therefore TCW was not awarded damages for legal breaches that didn't cause their loss.

There will surely be post-trial motions in this matter and we'll report back what we learn.