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Proskauer Whistleblower Defense

ARB Affirms Dismissal of SOX Whistleblower Claim Against Non-Public Companies

By Steven J. Pearlman & Allison Martin on August 19, 2019

The ARB recently affirmed the dismissal of a whistleblower retaliation claim under Section 806 of SOX, holding an employer is not a “contractor” covered by SOX simply because it was a party to a contract with a publicly traded company. Griffo v. Book Dog Books, LLC, Robert William Holdings, LLC & Robert William Mgmt., LLC, ARB Case No. 2018-0029 (May 2, 2019). Background Respondents are private companies in the business of selling and renting…

Proskauer Whistleblower Defense

Eastern District of Pennsylvania Grants Summary Judgment on SOX Claim

By Lloyd B. Chinn, Tony S. Martinez & Pinchos Goldberg on August 6, 2019

On July 18, 2019, the U.S. District Court for the Eastern District of Pennsylvania granted a defendant-employer’s motion for summary judgment on a SOX whistleblower retaliation claim, holding that the Plaintiff did not have an objectively reasonable belief that the defendant violated any SEC regulation. Reilly v. Glaxosmithkline, LLC, No. 17-cv-2045. Background Plaintiff worked in the company’s Information Technology Department as a member of the team responsible for the AS/400 computer operating system, which…

Proskauer Whistleblower Defense

Whistleblower Challenges Delayed Bounty Award

By Lloyd B. Chinn & Pinchos Goldberg on July 26, 2019

In a petition for a writ of mandamus filed on April 29, 2019 with the U.S. Court of Appeals for the D.C. Circuit, an unidentified whistleblower who claims to have tipped the SEC to alleged violations of the Foreign Corrupt Practices Act (“FCPA”) by Teva Pharmaceuticals more than eight years ago asked the court to compel the SEC to preliminarily determine within 60 days if he is eligible for compensation under the SEC’s whistleblower program…

Proskauer Whistleblower Defense

4th Circuit Vacates ARB SOX Whistleblower Decision for Lack of Protected Activity

By Steven J. Pearlman, Holly Ren Morris & Pinchos Goldberg on July 19, 2019

On June 13, 2019, the Fourth Circuit overturned the ARB’s decision in favor of a complainant, ruling that the plaintiff had not engaged in protected activity under the SOX whistleblower protection provision by complaining of a company’s use of a mandatory arbitration policy that allegedly was overly broad. Northrop Grumman Systems Corp. v. U.S. Dep’t of Labor, No. 17-cv-1811. In so ruling, the court recognized important limits on the scope of protected activity under…

Proskauer Whistleblower Defense

SDNY Dismisses SOX and Dodd-Frank Whistleblower Claims Against Private Company

By Steven J. Pearlman, Jacob L. Hirsch & Pinchos Goldberg on June 19, 2019

On June 3, 2019, the U.S. District Court for the Southern District of New York granted a defendant-employer’s motion for summary judgment on SOX and Dodd-Frank whistleblower retaliation claims, finding that the alleged whistleblowing did not involve fraud related to a public company. Tellez v. OTG Interactive, LLC, No. 15-cv-8984. Background Defendants operate restaurants and concession facilities in airports via iPad stations, which allow patrons to order food, access the Internet, and check…

Proskauer Whistleblower Defense

SEC Awards Joint Whistleblowers $3 Million Even Though Information Was Not Voluntarily Given

By Steven J. Pearlman, Annabel Pollioni & Pinchos Goldberg on June 18, 2019

On June 3, 2019, the SEC’s Office of the Whistleblower announced a $3 million award to two whistleblowers who provided the SEC with information that led it to investigate and successfully bring an enforcement action for securities fraud that affected retail investors. Because the whistleblowers submitted their tip to the SEC jointly, they will share the award. Prior to the initiation of the SEC investigation, the two whistleblowers had “candid discussions” with a different regulatory…

Proskauer Whistleblower Defense

Ill. Supreme Court Affirms Dismissal of Ill. Whistleblower Act and Retaliatory Discharge Claims

By Steven J. Pearlman & Caralyn M. Olie on June 17, 2019

On May 23, 2019, the Illinois Supreme Court issued a ruling in Roberts v. Board of Trustees of Community College District No. 508, reaffirming the pleading standards for both common law retaliatory discharge and “refusal-to-participate” claims the Illinois Whistleblower Act (“IWA”) (740 ILCS § 174/1). Background. In 2015, Plaintiff was employed as Director of Medical Programs at Malcolm X Community College in Chicago (College). He was responsible for ensuring professors were qualified and certain…

Proskauer Whistleblower Defense

House Financial Services Committee Passes Bill to Expand Dodd-Frank Whistleblower Protection to Internal Whistleblowers

By Steven J. Pearlman, Philippe A. Lebel & Pinchos Goldberg on May 29, 2019

On May 8, 2019, the House Committee on Financial Services passed H.R. 2515, the Whistleblower Protection Reform Act of 2019, which would amend Section 922 of Dodd-Frank to extend the statute’s anti-retaliation protections to employees who report alleged misconduct internally. Digital Realty Trust v. Somers H.R. 2515 was proposed in direct response to the U.S. Supreme Court’s holding last year in Digital Realty Trust, Inc. v. Somers, 138 S. Ct. 767 (2018). As detailed in …

Proskauer Whistleblower Defense

SEC Awards Whistleblower More Than $4.5 Million

By Lloyd B. Chinn & Pinchos Goldberg on May 28, 2019

On May 24, 2019, the SEC announced payment of more than $4.5 million to a whistleblower who sent an anonymous tip to the company alleging significant wrongdoing and then submitted the same information to the SEC. (The order granting the award can be accessed here.) In connection with this award, Jane Norberg, Chief of the SEC’s Office of the Whistleblower, said, “[i]n this case, the whistleblower was credited with the results of the company’s…

Proskauer Whistleblower Defense

Update on Bofl SOX Whistleblower Litigation

By Lloyd B. Chinn, Pinchos Goldberg & Annabel Pollioni on May 20, 2019

This is an update on our previous blog posts regarding the Erhart v. BofI Holding, Inc. case. We previously reported in October 2017 and March 2017 on a whistleblower litigation brought by Charles Erhart, a former Bank of Internet Holding, Inc. (Bofl) internal auditor. In late 2018, the parties filed cross-motions for judgement on the pleadings, including but not limited to Erhart’s SOX retaliation claim. Bofl specifically alleged that Erhart failed to exhaust his administrative…

Proskauer Whistleblower Defense

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ARB Affirms Dismissal of SOX Whistleblower Claim Against Non-Public Companies

Eastern District of Pennsylvania Grants Summary Judgment on SOX Claim

Whistleblower Challenges Delayed Bounty Award

4th Circuit Vacates ARB SOX Whistleblower Decision for Lack of Protected Activity

SDNY Dismisses SOX and Dodd-Frank Whistleblower Claims Against Private Company

SEC Awards Joint Whistleblowers $3 Million Even Though Information Was Not Voluntarily Given

Ill. Supreme Court Affirms Dismissal of Ill. Whistleblower Act and Retaliatory Discharge Claims

House Financial Services Committee Passes Bill to Expand Dodd-Frank Whistleblower Protection to Internal Whistleblowers

SEC Awards Whistleblower More Than $4.5 Million

Update on Bofl SOX Whistleblower Litigation

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