Management Shuffle Leaves McCall Out at PBHG

Pilgrim Baxter has replaced portfolio manager James McCall on all four of the PBHG funds he managed less than three weeks after he sued to be released from his contract.

The fund firm declined Tuesday to comment on McCall's employment status, his lawsuit or a countersuit filed by Pilgrim Baxter. Neither McCall nor his lawyer could be reached for comment. But Pilgrim Baxter did confirm that, as of May 28, there were new managers on the funds formerly piloted by McCall.

Now at the helm of PBHG (PBCRX)Core Growth is Jeff Wrona, who also manages the firm's (PBTCX)Technology & Communications fund.

A team led by Pilgrim Baxter co-founder Gary Pilgrim now runs McCall's three other funds: (PBHLX)Large Cap Growth, (PLCPX)Large Cap 20 and (PBHEX)Select Equity.

The manager shuffles come on the heels of a lawsuit McCall filed alleging that the Wayne, Pa.-based fund firm interfered with his plans to become a mutual fund manager at rival Merrill Lynch (MER). Pilgrim Baxter, which is owned by United Asset Management (UAM), responded with its own suit against McCall, claiming the fund manager was attempting to violate a noncompete agreement.

The removal of McCall, one of Pilgrim Baxter's most successful portfolio managers of late, follows several other portfolio manager departures, squeezing resources at the firm.

McCall took charge of the $87.4 million Core Growth fund last October after Ellen McGee left the firm. Wrona assumed full responsibility of the firm's $517 million tech fund when co-manager Michael Hahn left for for Merrill Lynch in May. Hahn and Wrona took over the tech fund a year earlier from John Force, who was charged with vehicular homicide following a drunk-driving incident that claimed the life of another driver. Force was recently sentenced to a three- to six-year prison term after pleading no contest to the charges.

Small-cap manager Pilgrim, still struggling with his ailing (PBHGX)Growth fund, down 5.9% in the last year, must now take on an additional $980 million in McCall's large-cap fund responsibilities.

>To order reprints of this article, click here: Reprints