The fund and Richard Brennan, who controls Camulos, used a calculated scheme and brazen abuse of power to force William Seibold out of the Camulos partnership and deprive him of his investments, according to the suit, which was filed on Wednesday in Delaware's Court of Chancery.
Camulos could not be immediately reached for comment.
Seibold and Brennan, both formerly with Soros, launched Camulos in 2005 and the fund grew to manage more than $2 billion in assets by 2007, according to court documents.
Seibold said he was the second-largest equity holder in the partnership but in order to receive his bonus for 2006 he had to sign an agreement that excluded him from the management committee.
When he received his bonus, it was far less than what he was entitled to receive, according to the suit. Seibold left the partnership soon after.
The case is William Seibold v Camulos Partners LP, Camulos Partners GP, Camulos Capital LP, Camulos Capital GP, Richard P. Brennan and Richard D. Holahan, Court of Chancery, State of Delaware, No. 5176 (Editing by Derek Caney)