Another GMPC story...
Another GM who Sue'd us - this one I shall call MB. MB's PC had been killed in a WFRP game by a fellow PC during an in-character argument after a dungeon delve. MB challenged the other PC to a duel and promptly lost. He didn't seem too bothered about it. He created a new PC and we carried on and nothing more was said.
A few weeks later, MB asked to take over the GM reins for a short while whilst I took a break from the campaign I was running. We all agreed and the game began. For four sessions we played a rather enjoyable dungeon-bash type game trying to get to a powerful Chaos Knight in a mountain - think Moria but smaller and with more traps. It wasn't that bad but very combat-centric.
When we finally confront the Chaos Knight the truth is revealed - the Knight is actually MB's dead PC, bought back from the dead by Khorne to be his champion. He then proceeds to wipe the floor with us, finishing the PC who he originally lost the duel with until last, making his death particularly gruesome. It was revenge on us for letting his PC die.
Four long sessions of mostly fun just so that he could take his revenge. What a bastard.