Hedge fund D E Shaw and four of its senior executives have been ordered two pay $52 million in a defamation case brought by a former partner, according to a report by the New York Times.

A panel of Financial Industry Regulatory Authority (FINRA) arbitrators made the award in favour of Daniel Michalow after concluding that he had not committed “sexual misconduct”. D E Shaw had claimed in a statement following Michalow's departure from the firm in 2018 that an internal investigation had found he had committed “gross violations of our standards and values.”

The award which is believed to be the largest in a defamation case overseen by FINRA, is binding and cannot be appealed.

Tom Clare, Michalow’s lawyer said in a statement that the award “sends a strong message that D E Shaw’s conduct, which misused and weaponised an important cultural movement and put profits ahead of the truth, was both morally and legally wrong.”

The four members of D E Shaw’s management committee named jointly liable for the settlement, are Max Stone, Julius Gaudio, Eric Wepsic and Eddie Fishman.