In a Law360 article (subscription required) today, Lloyd Chinn, Co-head of Proskauer’s Whistleblower & Retaliation Group, commented on the U.S. Supreme Court’s decision to hear its first-ever whistleblower case under the Sarbanes-Oxley Act of 2002 (“SOX”). 

The Court is tasked with reviewing the First Circuit’s holding in Lawson v. FMR LLC, 670 F.3d 61 (1st Cir. 2012), that SOX’s primary anti-retaliation provision does not cover the employees of a privately held contractor or subcontractor of a public company.  

In considering this question, the Court also may find occasion to clarify the standard of deference afforded to agencies like the U.S. Department of Labor (“DOL”) that do not follow precedent established by federal Circuit Courts.  Indeed, the DOL’s Administrative Review Board (“ARB”) recently diverged from the First Circuit and chose to extend SOX protections to employees of a publicly traded company’s contractors and subcontractors. 

Referring to this recent split, Chinn told Law360 that “the high court’s decision to step into the SOX arena came after a series of rulings from the ARB under the Obama administration that have overturned or established new precedent.”  Chinn continued that “[t]his case may well be an opportunity for the court to define the role that an agency’s opinion, or decision- or rule-making, will play in a court’s interpretation of a statute.” 

Given the potential breadth of the issues that the Supreme Court may address, Lawson may well be a landmark decision.