Lawyers called over fund industry scrap

Paul Glass. Photo / Supplied

Fund manager Brook Asset Management is turning to its lawyers in an investment sector scrap involving employees and former co-owner Paul Glass.

Glass this year set up new firm Devon Funds Management after a year-long restraint of trade agreement following the sale of the other half of Brook Asset to Macquarie Group at the end of 2008.

Earlier this year Glass bought the asset management business of Goldman Sachs JBWere and this month said Brook Asset executive director Mel Firmin and portfolio managers Chris Gaskin and Slade Robertson had joined Devon Funds.

Firmin and Robertson were expected to join Devon Funds by the start of next month followed by Gaskin in September.

However, in a letter to investors Brook Asset managing director Mark Brighouse noted media interest "regarding members of Brook's investment team intending to engage in employment at a newly formed funds management business".

"In light of these announcements and further developments, we have instructed our lawyers to issue proceedings in connection with breaches of fiduciary obligations and we are ... considering whether to institute proceedings against Devon Funds Management," Brighouse said.

Brighouse also told investors that Brook Asset had re-hired Andrew South as a portfolio manager.

South worked for Brook Asset from 2004 to 2008 and had significant experience in managing the company's funds, Brighouse said.

"With his former experience at Brook, Andrew will ... transition easily back into the team and immediately begin focusing on our portfolios and your investments in them."