An arbitration panel ordered a Merrill Lynch clearing unit to pay $63.7 million in damages to California hedge fund manager Rosen Capital Partners LP as compensation for losses during the 2008 financial crisis.

The panel found Merrill Lynch's Professional Clearing Corp unit liable for about $63.7 million in compensatory damages plus 9 percent interest accruing from October 7, 2008. It is one of the largest-ever awards granted by FINRA arbitrators.

The panel, however, denied punitive damages.

Rosen, based in Santa Monica, California, had alleged damages caused by unexpected margin calls which caused losses in two hedge funds. The firm sought $90 million plus punitive damages for what it said was breach of contract, fraud and negligence at Merrill.

Merrill spokesman William Halldin said on Wednesday the firm disagreed with the arbitration panel, and was considering asking a court to overturn the arbitration panel's award.

At all times, we met the contractual requirements of our relationship with this sophisticated hedge fund, which sought to blame us for losses during a period of extreme market volatility in October 2008, he said in an emailed statement.

Merrill's Professional Clearing, according to the unit's website, attracts and retains sophisticated and experienced professional, registered broker-dealers by continually developing innovative information management systems.

Rosen's attorneys were not immediately available for comment.

As is customary in arbitrations, the FINRA panel did not explain its ruling.

(Reporting by Joe Giannone in New York and Jochelle Mendonca in Bangalore; Editing by Saumyadeb Chakrabarty and Tim Dobbyn)