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Ex-Fund Manager Sues for Unfair Firing, Name-Calling
November 8, 2011
It wasn't enough that John Duffield, founder of New Star Asset Management Holdings Inc., fired fund manager Patrick Evershed - he also bullied the manager, calling him a “criminal” and a “moron.” That's according to the complaint.
Today was the first day of trial, where Evershed is suing New Star for unfair dismissal at a London employment tribunal and, according to his lawyer, subjected to “a very unpleasant environment.”
Duffield, who was not about to coddle his high-priced employees, “called the fund managers morons and criminals,” including Evershed. Duffield further “asked if they were ashamed of themselves when their funds performed poorly” and was “angry, antagonistic and unpleasant.” [C-I Note: Grounds for a Lawsuit - though you didn't ask me.]
Evershed first was suspended in 2008 by fund CEO Howard Covington, shortly after writing a letter to New Star’s HR department complaining about Duffield’s conduct. In the letter, Evershed said Duffield “has been most vile to most of the fund managers for several years and bullying us.” Evershed later resigned and sued the fund in October
Fund Manager's Employment. Evershed joined New Star in 2002, after being recruited by Duffield, under the agreement that his New Star Select Opportunities Fund wouldn’t exceed investments of £50 million ($80 million). Duffield said the limit was critical to its success.
Fund Size. Yet, the pressure to increase the size of his fund, which Evershed said he wished to keep small so he could manage it properly, and “a pattern of behavior” by Duffield, such as turning his back and walking away when Evershed tried to speak to him, created “an atmosphere of intimidation and humiliation,” Romney said. Most unfair dismissal claims in the U.K. are capped at about £65,000 ($104,000). More significantly, or to cover his bases, Evershed is pursuing whistleblowing claims that may have a higher value. The trial is scheduled to last 10 days. A request for comment to New Star’s law firm, Olswang LLP, wasn’t immediately returned.
Evershed Moves On. He now works in the fund-management department at Hargreave Hale Ltd. in London, advising private clients. Duffield is a senior partner at Brompton Asset Management, according to its website.
At the time he left his job at Rathbone Brothers Plc in 2002 before going to New Star, Evershed’s U.K. stock fund was the 3rd-best performer among the 308 funds tracked by S&P's U.K. All-Companies category. His Rathbone Special Situations Fund gained 8% in 2001, compared with the FTSE All Share Index’s 19% decline.
This case: Patrick Evershed v. New Star Asset Management, Central London Employment Tribunal. [Bloomberg, 11/7/11]

