Whistleblower Law Blog

U.S. Court Denies Caterpillar Summary Judgment in SOX Whistleblower Case

July 30, 2010

On July 13, 2010, the U.S. District Court for the Central District of Illinois denied a motion for summary judgment in Schlicksup v. Caterpillar, Inc., allowing a Sarbanes-Oxley (SOX) whistleblower, Daniel Schlicksup, to proceed to trial. Schlicksup, a tax manager with twenty years of experience, alleges that he was involuntarily reassigned by his employer Caterpillar to a position in the Information Technology Department due to his disclosures about the company not paying U.S. taxes on one of its structures.

Judge Mihm applied the adverse employment standard for Title VII retaliation claims prescribed in Burlington N. & Santa Fe Ry. v. White, and concluded that the involuntary reassignment might lead to a loss of “career prospects” and therefore constitutes an actionable adverse employment action.  Click here for the court’s full opinion.

The employment lawyers at The Employment Law Group® law firm have substantial experience representing employees in Sarbanes-Oxley whistleblower proceedings and have written numerous articles about the whistleblower provisions of the Sarbanes-Oxley Act.  For more information about TELG’s Sarbanes-Oxley Whistleblower Practice, click here.

SEC Grants $1 Million Reward to Whistleblower in Insider Trading Case

July 27, 2010

As reported by the Blog of Legal Times, the Securities and Exchange Commission (SEC) has awarded $1 million to Glen Kaiser and Karen Kaiser who blew the whistle on insider trading committed by Pequot Capital Management, Inc.  The Kaisers provided the SEC with emails between a Microsoft employee and a Pequot employee, David Zilkh.  Pequot agreed to pay the SEC civil penalties, including interest and disgorgement, totaling more than $27 million.

The new Dodd-Frank Act, which we blogged about here, requires the SEC to grant whistleblowers a 10% to 30% reward of the money recovered for information that leads to sanctions exceeding $1 million.

MSPB Rules that the Existence of an Investigation into Allegations Cannot be the Sole Cause for a Federal Employee’s Indefinite Suspension

July 26, 2010

On July 12, 2010, the Merit Systems Protection Board (MSPB) held in the case of Gonzalez v. DHS that the mere existence of a federal agency’s open investigation into allegations regarding a federal employee’s conduct cannot be the sole cause for that employee’s indefinite suspension.  The employee, Manuel Gonzalez, was suspended without pay indefinitely by the Department of Homeland Security (DHS) pending an investigation into allegations that he had committed domestic violence.  The MSPB further ordered DHS to cancel the indefinite suspension and pay Gonzalez back pay with interest.  Click here for the entire opinion.

The employment lawyers at The Employment Law Group® law firm have substantial experience representing federal employees before the MSPB.  To learn more about the firm’s Federal Employee Representation Practice.

Warwick Beacon Reports on Rhode Island Schoolteacher Whistleblower Case

July 23, 2010

On July 22, 2010, the Warwick Beacon reported on the O’Neill v. Warwick Public School District case in which The Employment Law Group® client, Mary Katherine O’Neill, testified that she was ordered by school administrators to change a top student’s grade.  O’Neill, a music teacher at Toll Gate High School for over 30 years, testified that she refused to change the grade, and as a result, she was harassed by the school’s principal, Steven Chrabaszcz, for two years before she was fired in August of 2008. 

The plaintiff is represented by Mr. R. Scott Oswald and Mr. Dave Scher, both Principals at The Employment Law Group® law firm.  For more information about the firm’s Whistleblower Law Practice, click here.

Providence Journal Provides Update on Rhode Island Schoolteacher’s Testimony in Whistleblower Case

July 23, 2010

The Providence Journal provided another update on the O’Neill v. Warwick Public School District case which we previously blogged about here.  The Employment Law Group® client, Mary Katherine O’Neill, was cross-examined on Thursday where she continually maintained that she was wrongfully terminated for refusing to lower a top student’s grade.

The plaintiff is represented by Mr. R. Scott Oswald and Mr. Dave Scher, both Principals at The Employment Law Group® law firm.  For more information about the firm’s Whistleblower Law Practice, click here.

The Employment Law Group® Law Firm is Quoted in BNA Article on New Dodd-Frank Act

July 23, 2010

Principal Jason Zuckerman of The Employment Law Group® law firm is quoted in an article in BNA’s Daily Labor Report titled “Attorneys Agree Financial Overhaul Bill Has Vigorous Whistleblower Protections” about the whistleblower provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.  The Dodd-Frank Act which we blogged about here, contains new incentives and protections for employees, amends the whistleblower protection provision of the Sarbanes-Oxley Act (SOX), and clarifies the anti-retaliation provision of the False Claims Act (FCA).

Section 1057 of the act creates a new private right of action for employees of the financial services industry who suffer retaliation for disclosing information about fraudulent or unlawful conduct related to the offering of a consumer financial product or service.  Zuckerman stated that ‘‘[this section] is especially significant because of its broad scope—it covers almost any employee working in the financial services industry related to the extension of credit, including employees of privately held companies.’’   Additionally, these claims are exempt from mandatory arbitration agreements and this section imposes an employee-friendly burden-shifting framework.  Upon the employee meeting his or her burden by a mere preponderance of evidence, the employer must prove by clear and convincing evidence that it would have taken the same adverse action in the absence of the employee’s protected conduct.

Section 922 creates another private right of action for employees who suffer retaliation in response to whistleblowing to the Securities and Exchange Commission, granting SOX whistleblowers an avenue to by-pass the SOX administrative complaint process and go straight to federal court.  Zuckerman pointed out that section 929A clarifies that SOX applies to subsidiaries of publicly traded companies—thereby eliminating a “significant” loophole. 

Section 1079B strengthens the anti-retaliation provision of the False Claims Act by extending protection to the “associated others” of the whistleblower, and also clarified that the statute of limitation for FCA claims is three years.   According to Zuckerman, ‘‘this provides important clarity for claims under Section 3730(h) of the FCA because under prior U.S. Supreme Court precedent, the limitations period ranged from as little as three months to five or six years.’’

For more information about The Employment Law Group® law firm’s Whistleblower Retaliation Practice, click here.

Providence Journal Provides Update on Rhode Island Schoolteacher Whistleblower Case

July 21, 2010

The Providence Journal provided an update on the O’Neill v. Warwick Public School District case which we previously blogged about here.  The Employment Law Group® client, Mary Katherine O’Neill, testified on Monday that she was ordered to lower a student’s grade, but refused to do so and was subsequently fired.

The plaintiff is represented by Mr. R. Scott Oswald and Mr. Dave Scher, both Principals at The Employment Law Group® law firm.  For more information about the firm’s Whistleblower Law Practice, click here.

The Employment Law Group® Law Firm Publishes Article on the Whistleblower Provisions of the Dodd-Frank Act

July 21, 2010

The Employment Law Group® Law Firm principals Scott Oswald and Jason Zuckerman published an article in Law360 titled “Whistleblower Provisions of the Dodd-Frank Act.”  The article discusses the whistleblower provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.  The article is available here.

For more information about The Employment Law Group® law firm’s Whistleblower Retaliation Practice, click here.

National Law Journal Quotes The Employment Law Group® Law Firm About Whistleblower Provisions in Financial Services Reform Legislation

July 20, 2010

The Employment Law Group® law firm is quoted in the lead story in The National Law Journal titled “Financial Reform Includes New Whistleblower Program.”  The article reports on the whistleblower protection provisions in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which we blogged about here.  The article states in part:

However, employment and whistleblower lawyers say the SEC program and other whistleblower protections in the financial reform bill are critical.

“What we saw from the Madoff Ponzi schemes is that the SEC was often asleep at the wheel and had a propensity to ignore information provided by whistleblowers who often did so at substantial risk to their job security and to their careers,” said Jason Zuckerman, principal in Washington, D.C.’s The Employment Law Group. “This new monetary reward program should encourage employees to blow the whistle and put more pressure on the SEC to conduct real investigations that would lead to appropriate accountability.”

Zuckerman said the bill also closes loopholes in the anti-retaliation provisions in the Sarbanes-Oxley Act of 2002 and the False Claims Act. Some administrative law judges and courts, he explained, had interpreted those provisions to apply only to the parent entity and not to its subsidiaries. “That was a huge loophole that has been closed,” he said.

The legislation also gives whistleblowers a private cause of action for damages stemming from retaliation.

For more information about The Employment Law Group® law firm’s Whistleblower Retaliation Practice, click here.

Providence Journal Reports on a Rhode Island Schoolteacher Whistleblower Case

July 16, 2010

On July 15, 2010, the Providence Journal reported on the latest news from O’Neill v. Warwick Public School District which we previously blogged about here.  The plaintiff, Mary Katherine O’Neill, taught music at Toll Gate High School in Warwick, Rhode Island for nearly 30 years.  According to the complaint, a school counselor ordered O’Neill to change a student’s grade from an “A+” to an “N” for “No Grade.”  O’Neill refused to change the grade and reported the incident to school administrators and the teachers union.  She further alleges that Toll Gate High Principal, Stephen Chrabaszcz, harassed her and eventually fired her because of her refusal.  Victor Mercurio, superintendent of the East Greenwich School Department, testified on Wednesday on the circumstances surrounding O’Neill’s firing.

The plaintiff is represented by Mr. R. Scott Oswald and Mr. Dave Scher, both Principals at The Employment Law Group® law firm.  For more information about the firm’s Whistleblower Law Practice.