Sarbanes-Oxley Act (SOX)

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In a landmark unanimous ruling late last week, Murray v. UBS Securities, LLC, et al. 601 U. S. ____ (2024), the U.S. Supreme Court held that whistleblowers do not need to prove their employer acted with “retaliatory intent” to be protected under the Sarbanes-Oxley Act. Instead, all whistleblower plaintiffs need to prove is that their protected activity was a “contributing factor” in the employer’s unfavorable personnel action. Continue Reading U.S. Supreme Court Endorses Low Burden of Proof for Whistleblowers

In Lawson v. FMR, LLC, No. 12-3, 2014 WL 813701 (U.S. Mar. 4, 2014), the Supreme Court of the United States, in a 6-3 decision reversing the United States Court of Appeals for the First Circuit, held that the whistleblower protection provision in Section 806 of Sarbanes-Oxley Act of 2002, 18 U.S.C. § 1514A (“SOX”), protects employees of publicly traded companies and employees of privately held companies that are contractors or subcontractors for a covered publicly traded company.  In reaching this decision, the Supreme Court has clarified the definition of “covered employee” under the whistleblower provisions of SOX and expanded the scope of SOX.
Continue Reading United States Supreme Court Holds That Section 806 of the Sarbanes-Oxley Act Extends to Employees of Private Companies Who Are Contractors or Subcontractors for Covered Public Companies

In Lawson v. FMR LLC, No. 10-2240, 2012 U.S. App. LEXIS 2085 (1st Cir. Feb. 3, 2012), the United States Court of Appeals for the First Circuit, in a case of first impression, held that the whistleblower provision in Section 806 of Sarbanes-Oxley Act of 2002, 18 U.S.C. § 1514A (“SOX”), applies only to employees of public companies, and does not protect employees of private companies who are contractors or subcontractors for the covered public company. This decision, the first decision by a United States Court of Appeals on this issue, helps clarify the definition of “covered employee” under whistleblower provisions of SOX.
Continue Reading First Circuit Holds That Section 806 of the Sarbanes-Oxley Act Extends Only to Employees of Public Companies, Not Employees of Private Companies Who Are Contractors or Subcontractors for Covered Public Companies

By Ryan Rosner & Gregg A. Fisch

The Department of Labor’s Administrative Review Board (“ARB”) recently held that the Sarbanes-Oxley Act (“SOX”) provides greater protections to whistleblowers than Title VII provides to covered employees. Under this new decision, companies face a potential new risk from purported retaliatory actions that they may take towards their employees. Specifically, in Menendez v. Halliburton, Inc., ARB Nos. 09-002, 09-003 (Sept. 13, 2011), the ARB found that a company’s disclosure of the identity of an employee who reported alleged improper accounting practices could be deemed a breach of confidentiality and, thus, could constitute an “adverse action” under the whistleblower protections of SOX.Continue Reading Department of Labor’s Administrative Review Board Interprets Term “Adverse Action” Under SOX More Expansively Than It Is Interpreted Under Title VII