The Volokh Conspiracy

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Free Speech

$52M #TheyLied Libel Arbitration Award


Barron's Kenneth Corbin reported Friday:

A Finra [Financial Industry Regulatory Authority] arbitration panel has awarded a former partner [Daniel Michalow] with the hedge fund group D.E. Shaw $52 million in damages in a defamation case that stemmed from rumors of sexual misconduct that the arbitrators concluded were untrue….

The arbitrators … concluded flatly: "The panel specifically finds that claimant did not commit sexual misconduct." …

Michalow's ouster from the firm came in early 2018, at the height of the #MeToo movement. In a letter sent in May that year to David E. Shaw, the hedge fund's founder, Michalaw acknowledged that he had been "abrasive and intolerant" as a boss, and admitted to instances of inappropriate language and nonsexual physical contact with employees like hugging.

"All I have asked is that the firm say publicly what has repeatedly been told to my representatives and to me privately—that my departure from the firm is not related to sexual misconduct," Michalow wrote in 2018.

"The firm's bullying and threats against me over the last week, however, have revealed that the firm is so consumed with creating the appearance of supporting women that it is willing to cast false aspersions on me (and perpetuate false aspersions cast by others) and make me a scapegoat with a proverbial hanging in the town square," he added….

Thanks to Bruce Wessel for the pointer.