Larry Miller, the team’s president, cited philosophical differences for the dismissal.
Penn joined the team as assistant general manager in 2007.
“We felt it was in the organization’s best interest to move in a different direction at this time,” Miller said in a statement. “This was not an easy decision, as Tom has played an integral role for us the past three seasons. We thank him for his contributions and wish him the best in the future.”
The team had dubbed Penn a “salary capologist” because he knew intricacies of the NBA salary cap and collective bargaining agreement. Penn worked with general manager Kevin Pritchard on structuring contracts, trades, evaluating talent and managing day-to-day basketball operations.
He previously served as assistant general manager and legal counsel for the Memphis Grizzlies. Penn is a former sports agent who worked as an Illinois criminal defense attorney.
Penn was mentioned last summer as a top candidate for the Minnesota Timberwolves general manager’s position. He withdrew his candidacy when the Blazers promoted him to vice president. The Timberwolves job eventually went to Portland native David Kahn.