Whistleblower Law Blog

The Employment Law Group® Law Firm Calls for Congress to Include Whistleblower Protections in Bailout Bill

September 25, 2008

Attorneys at The Employment Law Group® law firm join the Government Accountability Project (GAP) and 226 other diverse organizations in their  petition for Congress to include federal whistleblower protections in the bailout bill.  This week, GAP and other public interests groups delivered a letter to legislators emphasizing the need for comprehensive whistleblower protections, including the right to a jury trial and expansion of protections to screeners, scientists and national security whistleblowers.  To express support for comprehensive whistleblower protections, go to www.WhistleblowerAction.org and sign the Citizen’s Whistleblower Petition.

The Employment Law Group® law firm frequently represents whistleblowers in the financial services industry.  For more information about federal corporate whistleblower protections, click here. 

GAP Report Seeks Overhaul of Corporate Whistleblower Protection Laws

September 23, 2008

In a report titled, “Running the Gauntlet:  The Campaign for Credible Corporate Whistleblower Rights,” the Government Accountability Project (GAP) calls for an overhaul of whistleblower protection laws for corporate and other private sector employees.  The report documents the need to continue to pass sector-by-sector whistleblower laws and suggests strategies for a “treacherous legal landscape” that corporate whistleblowers encounter in pursuing retaliation claims.  According to the report, Congress is moving in the right direction by passing best practices laws like the Consumer Product Safety Improvement Act of 2008 to restore corporate free speech protection.  To read the full report, click here.  For more information about legislation designed to strengthen protections for corporate whistleblowers, click here. 

Texas District Court Rejects Heightened Pleading Standard in SOX Case

September 22, 2008

In Ellis v. CommScope, Inc. of North Carolina, a Texas district court judge rejected an employer’s attempt to impose a heightened pleading standard on SOX plaintiffs.  CommScope moved to dismiss on the grounds that Ellis did not plead scienter in alleging that he disclosed shareholder fraud.  The district court rejected CommScope’s “flawed” reasoning, holding that at the pleading stage, “Ellis is not required to show that CommScope acted with scienter” and instead “merely needs to plead facts showing he had a reasonable belief that CommScope acted with scienter.”

DOL Decides in Favor of Federal Agency Whistleblower

September 16, 2008

In Dixon v. U.S. Dep’t of the Interior., the Department of Labor’s Administrative Review Board (ARB) held that Earle Dixon, a federal employee of the Department of Interior’s Bureau of Land Management (BLM) engaged in protected activity under the whistleblower provisions of the Safe Drinking Water Act (SDWA) and the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) when he raised concerns about the contamination of a Nevada copper mine and told his supervisors that the intergovernmental effort to clean up the mine was non-compliant with CERCLA regulations. In affirming the ALJ’s decision, the ARB concluded that the BLM failed to prove that Dixon was terminated for poor performance or other reasons independent of his protected activity and was therefore liable for whistleblower retaliation.  The ARB also affirmed the ALJ’s decision awarding Dixon back pay and compensatory damages.

 

Sponsors of SOX Whistleblower Provision Disappointed with DOL’s Efforts to Undermine SOX Whistleblower Protection

September 12, 2008

Senators Patrick Leahy (D-Vermont) and Charles Grassley (R-Iowa) sent a letter to the Department of Labor Secretary Elaine Chao expressing their disappointment with the Department’s overly restrictive interpretation of the whistleblower protection provisions of the Sarbanes-Oxley Act (“SOX”).  The letter pointed to a recent Wall Street Journal article reporting that approximately sixty-six percent of SOX whistleblower cases were dismissed since 2002, many of which on the grounds that the employee worked for a subsidiary of a publicly traded company rather than directly for a publicly traded company.  Senators Leahy and Grassley, the sponsors of the SOX whistleblower provision, explain that Congress never intended to limit SOX whistleblower protections to direct employees of publicly traded companies. Instead, the broad language of the whistleblower protection provision was meant to protect direct employees of publicly traded companies as well as employees of contractors, subcontractors and agents of publicly traded companies.

The Employment Law Group® Law Firm Publishes Column on Sarbanes-Oxley Whistleblower Protection

September 11, 2008

The National Law Journal published a column by principals R. Scott Oswald and Jason Zuckerman of The Employment Law Group® law firm on the Fourth Circuit’s recent decision in the closely watched Sarbanes-Oxley (“SOX”) whistleblower case Welch v. Chao.  The column explains how the Welch decision is in many ways a victory for SOX whistleblowers in that it resolves many ambiguities in favor of employees and rejects many of the defense arguments that are commonly asserted in Sarbanes-Oxley whistleblower cases.

DOL Clarifies that SOX protects Employees of Subsidiaries of Publicly Traded Companies

September 11, 2008

In Andrews v. ING North America Insurance Corp., the Department of Labor’s Administrative Review Board (ARB) held that a subsidiary of a publicly-traded company can be a covered employer under the whistleblower provisions of the Sarbanes-Oxley Act (“SOX”) i.e., SOX coverage is not limited solely to direct employees of publicly traded companies.  Plaintiffs Andrews and Barron, employees of ING North America Insurance Corporation (“ING NAIC”), alleged that ING NAIC and its parent company ING Groep, N.V. (a publicly traded company), conspired to terminate them for reporting security problems with ING’s computer network. OSHA and an Administrative Law Judge dismissed their complaint based on a finding that ING NAIC is not a publicly traded company.  The ARB reversed and remanded, concluding that Barrons and Andrews are entitled to demonstrate that ING NAIC can be covered under SOX as an agent of a publicly traded company.

Federal Jury Awards $2.8 Million to Ferry Whistleblower

September 03, 2008

Last week, a federal jury awarded Ken Marable $2.8 million in a whistleblower lawsuit against Washington State after finding that Marable’s supervisors retaliated against him for complaining about paycheck padding and misuse of department funds.  Marable, a chief engineer for the ferry system for 34 years, alleged that he was subjected to retaliation because he raised concerns about the dishonest practices of Washington State Ferries management. 

House Passes Legislation to Strengthen FAA Procedures

September 03, 2008

On July 22, 2008, the House unanimously approved H.R. 6493 (Aviation Safety Enhancement Act of 2008), to strengthen airline maintenance oversight procedures conducted by the Federal Aviation Administration (“FAA”).  The new legislation requires the FAA to conduct monthly reviews of the Air Transportation Oversight System and to rotate principal maintenance inspectors among airline oversight offices every five years.  The new procedures will ensure that trends in airline regulatory compliance are promptly identified and that appropriate remedial actions are taken.  The legislation also calls for an independent whistleblower office to investigate and address aviation safety concerns raised by FAA employees.  For more information on airline whistleblower protections click here.

 

Citibank Settles Claims of Theft after Three Year Investigation

September 03, 2008

After a three year investigation, Citibank agreed to pay $3.5 million to the state of California to resolve a lawsuit alleging that the company stole funds from its customers’ accounts.  In particular, the suit alleged that Citibank illegally employed a computerized “credit sweep” process that automatically removed positive or credit balances from credit-card customer accounts in recovery status.   According to Attorney General Jerry Brown, over 53,000 customers were affected by the bank’s scheme including customers who were deceased, bankrupt, or the target of prior litigation or collection efforts by Citibank.  The whistleblower who questioned the bank’s unlawful practice will receive $300,000.   The settlement also requires repayment of more than $14 million dollars to customers damaged by the illegal credit sweeps.