In a recent Employment Law360 article (subscription required), Steve Pearlman, co-head of Proskauer’s Whistleblowing & Retaliation Group, commented on the Third Circuit Court of Appeals’ decision in Wiest v. Lynch, No. 11-cv-4257, 2013 U.S. App. LEXIS 5345 (3d Cir. March 19, 2013), adopting the U.S. Department of Labor Administrative Review Board’s interpretation of “protected activity” under SOX’s whistleblower provisions.  

The Third Circuit found that the district court erred in holding that SOX protected activity must “definitively and specifically” relate to one of several laws set forth in SOX, stressing that “[a]n employee must establish not only a subjective, good-faith belief that his or her employer violated a provision listed in SOX, but also that his or her belief was objectively unreasonable.”  The Third Circuit also held that, to be protected, communications need not relate to an existing violation. 

Noting the risks attendant to this ruling, Pearlman stated:

This creates a risk within the Third Circuit of opening the floodgates to cases where it is highly tenuous that there’s been a violation of one of the laws in Section 806.

Pearlman also explained:

The ruling doesn’t translate to a death knell for defense motions for summary judgment based on protected activity in SOX whistleblower cases, but it does repudiate a standard that had been more friendly to employers.

We will monitor the aftermath of this decision and keep you posted.

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Photo of Noa Baddish Noa Baddish

Noa M. Baddish is a senior counsel in the Labor & Employment Law Department. She is a member of the Sports, Employment Litigation & Arbitration, Class and Collective Action, Wage & Hour and Whistleblower & Retaliation Practice Groups.

Noa’s practice concentrates on all…

Noa M. Baddish is a senior counsel in the Labor & Employment Law Department. She is a member of the Sports, Employment Litigation & Arbitration, Class and Collective Action, Wage & Hour and Whistleblower & Retaliation Practice Groups.

Noa’s practice concentrates on all aspects of labor and employment law. Her employment litigation practice in state and federal courts includes class and collective actions and defending claims of discrimination, harassment, breach of contract and violations of wage and hour laws. Noa represents Major League Baseball and its clubs in an ongoing litigation brought by current and former minor league players who allege minimum wage and overtime violations. In addition, Noa has represented clients in the media and entertainment and fashion industries in lawsuits brought by unpaid interns in wage and hour disputes.

Noa also provides significant assistance on counseling matters on a wide array of issues for clients in various industries, including, but not limited to, sports, law firms, financial institutions, media and fashion.

Noa has been recognized as a Rising Star by New York Super Lawyers since 2015. She has authored and contributed to several articles and newsletters on employment and labor topics, including “State Whistleblowing Laws Provide Whopping Verdicts,” New York Law Journal (January 2014). Noa is also a frequent contributor to the Firm’s Whistleblower Defense blog.

Previously served as Assistant General Counsel to the New York City Mayor’s Office of Labor Relations, Noa defended the Mayor and City agencies against both employee grievances at arbitration and improper practice petitions before the Board of Collective Bargaining. Prior to that, she was a Law Clerk to Judge Ellen L. Koblitz of the Appellate Division of the New Jersey Superior Court.

While in law school, Noa served on the Executive Board as notes and articles editor of the Fordham Urban Law Journal.