Dumped Labour MP Chris Carter told the party's ruling council that he could dish the dirt on senior Labour MPs and if he didn't get his way, "it's war".
Labour's ruling council expelled Mr Carter from the party on Monday for sending anonymous letters to journalists criticising Phil Goff and making subsequent disparaging comments about the leader.
At one point in his submission, Mr Carter told the council: "You can make a friend or a foe of me, and if you make a foe, it's war."
Mr Carter said it occurred during a heated exchange, but only after he and his two supporters had been asked to leave the room for a "short time", which turned out to be 85 minutes.
"When I came back into the room, I was a bit grumpy."
Mr Little said the council took the words as a direct threat and it was a factor in the council's final decision.
He and Labour leader Phil Goff have also challenged Mr Carter's claim in his submission that there were 17 Labour MPs who would support a change in the leadership.
It is understood Mr Carter also said he discussed the best time to change the leadership with three Labour MPs in his office on the night before he sent anonymous letters in July.
He said he had no intention of "dobbing in his mates" by naming names, or dishing any dirt on his former colleagues.
A war of words has erupted since Mr Carter found out his fate on the radio yesterday morning, though Mr Little had told one of Mr Carter's support people immediately after the decision was made.
Mr Carter called the party bosses vindictive, petty, and spiteful, while Mr Little responded by saying Mr Carter was vengeful, angry and volatile.
"Chris Carter is very angry and in victimhood mode, and he is looking for anything that justifies him continuing to feel a sense of grievance," Mr Little said.
Mr Goff said Mr Carter was lying about dissent in the party and challenged him to "put up or shut up".
"Is there a plot, is there a coup? Absolutely not. Don't make idle threats. I deplore that sort of blackmail."
But Mr Carter said he was the victim of "character assassination".
He said the whole episode was triggered over his travel expenses, and he had tried to please the leader by holding a press conference to apologise.
He did not plan to appeal against the council's decision and still intended to stay on as the MP for Te Atatu, though that could change.
"If this nastiness from the Labour Party continues and this character assassination, why would I want to stay?"