On April 25, 2017, Digital Realty Trust Inc. asked the United States Supreme Court to decide whether an employee who files an internal complaint (as opposed to a complaint with the SEC) is covered by the Dodd-Frank Act’s whistleblower-protection provision.
In a 2-1 decision, the Ninth Circuit in Somers v. Digital Realty Trust, 15-17352 (9th Cir. March 8, 2017) held that Dodd-Frank’s anti-retaliation provision protects employees who complain internally to their employer. Digital Realty told the Supreme Court that review of the Ninth Circuit’s decision presents an opportunity to resolve a circuit split between the Ninth and Second Circuits, which are aligned and have found that internal whistleblowers are covered by Dodd-Frank, with the Fifth Circuit, which has held that a whistleblower must report any concerns to the SEC to be covered by Dodd-Frank.
Just last month, the Supreme Court declined an opportunity to review a decision (Verble v. Morgan Stanley Smith Barney, LLC., No. 16-946) where the Sixth Circuit affirmed the dismissal of a plaintiff’s whistleblower claim. In that case, the plaintiff did not complain to the SEC, but the Sixth Circuit did not address whether Dodd-Frank protects internal whistleblowers and affirmed dismissal on other grounds. It remains to be seen whether the Supreme Court will grant Digital Realty’s request to address this incredibly divisive issue.