Legal proceedings continue against Ronnie Wu, Natalie Cruz and their new fund-of- fund operation Penjing Asset Management following the original writ served in May 2005. The plaintiff in Hong KongÆs High Court is their former employer, Hong Kong-based, Vision Investment Management.

The case considers whether VisionÆs former staff had a conflict of interests by pursuing their own private interests at the same time as being salaried employees, whether they upheld fiduciary duties whether they acted in good faith, whether they misused confidential information and whether they acted in breach of trust as well as in breach of their employment agreements with Vision. The allegations made by Vision are that :

1. Ronnie Wu and Natalie Cruz, who left Vision in April 2005 and February 2005 respectively, spent a lot of office time in during their last few months of employment making plans for their new venture.

2. Some of VisionÆs investors were approached and asked to switch to Penjing. In addition to clients, at least one Vision employee also switched to Penjing.

3. Information about client lists, hedge fund research and portfolio positions was downloaded, and their tracks covered up using spybot software.

4. Although the writ that AsianInvestor possesses claims unspecified exemplary damages against each defendant; the level of damages will become public should the case go to court. Vision is asking for the return of their salaries, commissions, bonuses and housing allowances from June 2004 onwards. It is also asking for a sum representing management and performance fees from the business that was lost as well as an account of profits. The writ also claims that Penjing induced Ronnie Wu and Natalie Cruz to breach their duties and contracts with Vision.

Both Vision and Penjing declined to comment on the matter.

Vision is one of AsiaÆs most well known indigenous fund-of-funds managers. It has total assets under management of $1.7 billion. It was the recipient of a portion of the hotly contested Calpers allocation to Asian fund of funds in 2005. Vision was also a double winner of AsianInvestorÆs Asian fund of funds award in 2004 and 2005.

Penjing kicked off with $50-100 million under management under Ronnie Wu, whose family is linked to Wing Lung Bank; Natalie Cruz; and UBSÆ fund of hedge funds team, Lawrence Ka and Louis Chan. It has done very well since its inception and it is rumoured that Penjing is on the verge of receiving a monster-sized mandate from a top international bank.