(Bloomberg) -- Jane Street Group said a former trader whom it claims stole secret billion-dollar India options strategies for Millennium Management previously ridiculed his new employer’s own strategies as “dumb.”

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In a court filing last week, Jane Street said the alleged comments by Doug Schadewald undercut the defense that the allegedly stolen strategies were based on “textbook” principles. Whether Jane Street’s strategies are unique is at the heart of the trade-secrets suit the proprietary-trading firm brought against Schadewald, fellow trader Daniel Spottiswood and Millennium in April.

If the strategies were well-known, other Millennium traders would have been using them, Jane Street lawyer Deborah Brown wrote Wednesday in a letter to US District Judge Paul Engelmayer in Manhattan. But she said that hasn’t been the case.

“Indeed, before he joined Millennium, Schadewald derided Millennium’s volatility traders, saying ‘none of those guys can make money’ because ‘they all do the same dumb strategies,’” Brown said.

The case is now in the discovery phase where the parties exchange evidence. Though they claim credit for building Jane Street’s India options desk, Schadewald and Spottiswood have said their trading is based on experience and expertise rather than anything secret. Millennium has similarly argued that it’s been active in the Indian market for years.

Text Exchange

The “dumb strategies” comment referred to in Wednesday’s letter was allegedly part of a text-message exchange Schadewald had with another person on Jan. 18, just a few weeks before he resigned from Jane Street to join Izzy Englander’s hedge fund group. The name of Schadewald’s correspondent and other parts of the exchange were redacted in a court filing, but the conversation appears to refer to negotiations the trader was having with both Jane Street and Millennium at the time.

According to Jane Street, discovery to date shows that the allegedly stolen strategies aren’t widely used at Millennium outside of Schadewald’s group. Jane Street said Millennium had refused to put forth deposition witnesses to testify about its awareness and use of the strategies prior to Schadewald’s hiring and should be ordered to do so.

“Millennium admits it has been trading in India ‘for years’ before hiring Schadewald, so Jane Street is entitled to testimony on whether Millennium employed Jane Street’s allegedly ‘textbook’ strategies during those ‘years,’ and if so, for how long,” Brown wrote.