On December 6, 2022, the U.S. District Court for the Eastern District of Pennsylvania granted a defendant-employer’s motion for summary judgment on whistleblower retaliation claims brought under SOX and the Consumer Financial Protection Act of 2010 (“CFPA”).  It held that the plaintiff could not prove that her alleged complaints of illegal conduct contributed to the decision to discharge her, and that even if she could prove that, the employer would have fired her anyway.  Real-Loomis v. The Bryn Mawr Trust Company, No.-cv-0441.

Background

Plaintiff, who was employed as a banker, alleged that the defendant-employer subjected its employees to “relentless” and “incessant” pressure to meet sales quotas by tracking how much new business employees generated, which caused them to fear that their employment would be terminated if they did not meet their sales goals.  Plaintiff claimed that, on three separate occasions, she complained to her supervisor and branch manager about the sales pressure she allegedly experienced, stating her belief that the employer’s sales tactics were “inappropriate, fraudulent, and not at all in the best interests of customers.”  The branch manager then shared Plaintiff’s concerns with the regional manager.

Shortly thereafter, Plaintiff opened a joint bank account with her husband after the branch manager allegedly asked for help fulfilling the branch’s sales quota.  A senior manager subsequently noticed that there had been an unusually large number of new account openings at Plaintiff’s branch on the same day, and that many of the account openings for employees’ relatives.  Following an investigation due to the suspicious nature of these openings, it was allegedly determined that Plaintiff had forged her husband’s signature.  As a result, the senior manager decided to discharge multiple employees for their involvement in the allegedly fraudulent account openings, including Plaintiff and the branch manager to whom she had previous complained.

Plaintiff proceeded to file suit (following a complaint to the U.S. Department of Labor) claiming was retaliated against for her complaints about the pressure she faced to meet sales quotas in violation of SOX and the CFPA.

Ruling

The court granted the defendant-employer’s motion for summary judgment, finding that Plaintiff could not demonstrate at least two elements of a prima facie case because she did not show: (i) that she engaged in protected activity, or (ii) that any protected activity contributed to the decision to discharge her.  The court noted that Plaintiff’s general reference to “fraudulent” conduct in her complaints to the branch manager did not constitute protected activity under SOX or the CFPA because she failed to identify specific practices that she believed violated either of those laws.  Plaintiff also could not establish that her complaints to the branch manager or her subsequent complaint to the U.S. Department of Labor was a contributing factor in the termination decision.  Plaintiff offered no evidence that the senior manager who decided to discharge her was aware of Plaintiff’s complaints to the branch manager, and therefore those complaints could not have factored into the decision.  Plaintiff’s complaint to the Department of Labor, moreover, post-dated Plaintiff’s discharge and therefore could not have played a role in the termination decision.

The court also found that Plaintiff’s claims failed because the employer established that it would have made to same decision to discharge Plaintiff regardless of any protected activity.  The court noted that the employer fired two other employees as a result of its investigation: another employee who had also purportedly forged a family member’s signature, and the branch manager who had orchestrated the purported scheme.  The court held that this treatment of similarly situated employees who did not complain about violations of SOX and the CFPA constituted clear and convincing evidence that Plaintiff would have been discharged absent any protected activity.

Implications

This decisions reaffirms certain basic principles underlying typical whistleblower retaliation claims, including the common sense notion that an employer cannot decide to retaliate against an employee based on a complaint it did not know about or that was first made after the allegedly retaliatory conduct occurred.