Harley Bassman, a veteran of the bond market known for inventing the MOVE index, has filed a lawsuit against Simplify Asset Management. He alleges that Simplify failed to honor revenue-sharing agreements totaling millions of dollars for several exchange-traded funds he helped create. The lawsuit, filed on April 7 in a California federal court, claims Bassman is owed approximately $5 million in back pay, interest, and damages.
Bassman's complaint states that Simplify recruited him in 2021 for his ideas, credibility, and investor access, promising him a defined share of ETF revenues. He claims he was entitled to 60% of net revenue while employed and 25% after departure for the PFIX interest-rate hedging fund, which launched soon after he joined and generated significant returns. Bassman alleges Simplify has not honored this agreement since 2023. He also helped develop the MTBA mortgage-backed securities ETF in 2023, which has grown to about $1.7 billion, and claims he is owed a 20% share of its revenue under a separate agreement that Simplify has refused to uphold.
Simplify's CEO, Paul Kim, disputes Bassman's claims, stating the firm looks forward to challenging them in court. Bassman further alleges that Simplify removed him as portfolio manager from five funds, including the $1.7 billion mortgage-backed securities ETF, in November as retaliation for his payment dispute. Bassman had sent a letter to Simplify in November attempting to resolve the compensation issues before the firm filed documents with the SEC removing him from his portfolio manager roles.
