Proskauer Whistleblower Defense

Lloyd B. Chinn

Lloyd B. Chinn

Partner
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Lloyd B. Chinn is a partner in the Labor & Employment Law Department and co-head of the Whistleblowing & Retaliation Group. He litigates employment disputes of all types before federal and state courts, arbitration tribunals (e.g., FINRA, JAMS and AAA), and before administrative agencies in New York and across the country. Lloyd's practice ranges from litigating compensation disputes to defending whistleblower, discrimination and sexual harassment claims. Although he represents employers in a wide range of industries, including law, insurance, health care, consulting, media, education and technology, he focuses a substantial portion of his practice on the financial services sector. He has tried to final verdict or arbitration award substantial disputes in this area.

Due to Lloyd’s litigation experience, clients regularly turn to him for advice regarding the full range of employment matters, including terminations, whistleblower policy and procedure, reductions in force, employment agreements, and employment policies. For example, in the wake of the financial crisis, he has counseled a number of firms through reductions in force and related bonus and deferred compensation disputes. Lloyd has also been retained to conduct internal investigations of allegations of workplace misconduct, including claims leveled against senior executives.

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ACA Retaliation Claim Survives Despite No Complaint About ACA Provisions

By Lloyd B. Chinn, Harris Mufson and Susan McAleavey on Posted in ACA
On April 28, 2017, the United States Department of Labor Administrative Review Board (“ARB”) allowed a whistleblower retaliation claim under the Patient Protection and Affordable Care Act (“ACA”) to proceed even though the purported protected activity alleged in the complaint made no reference to ACA provisions.  The case is Gallas v. The Medical Center of … Continue Reading

CFTC Amends Whistleblower Rules to Strengthen Anti-Retaliation Protections and Encourage Whistleblower Tips

By Lloyd B. Chinn and Noa Baddish on Posted in CFTC, Dodd Frank
On May 22, 2017, the U.S. Commodity Futures Trading Commission (“CFTC” or the “Commission”) adopted several additions to its whistleblower rules.  Among other things, the amendments expand the Commission’s power to pursue anti-retaliation claims on behalf of whistleblowers and, like the SEC, now prohibit confidentiality agreements that “impede” a whistleblower’s communications with the CFTC.   The CFTC … Continue Reading

The Northern District of New York Applies the “Reasonable Belief” Standard

By Lloyd B. Chinn, Harris Mufson and Dana N. Berber on Posted in Dodd Frank, SOX Whistleblower Decisions
On May 11, 2017, the Northern District of New York applied the Second Circuit’s standard for evaluating a Dodd-Frank retaliation claim in response to a motion to dismiss under F.R.C.P. Rule 12(b)(6).  The court denied the employer’s motion to dismiss unlawful retaliation claims brought by a former employee under Dodd-Frank, finding that the whistleblower had … Continue Reading

California Federal Court Upholds $8 Million Jury Verdict In Former General Counsel’s Whistleblower Lawsuit

By Lloyd B. Chinn, Harris Mufson and Andrew Sherwood on Posted in Dodd Frank, SOX Whistleblower Decisions
Recently, a California federal court denied the defendant–employer’s motion for a new trial, upholding the jury’s $7.96 million verdict finding that the Company terminated its former general counsel for reporting alleged Foreign Corrupt Practices Act violations.  See Sanford S. Wadler v. Bio-Rad Labs., Inc. et al., 2017 WL 1910057 (N.D. Cal. May 10, 2017).… Continue Reading

SEC Issues Another Whistleblower Bounty Award

By Lloyd B. Chinn, Harris Mufson and Dana N. Berber on Posted in SEC
On May 2, 2017, the Securities and Exchanges Commission issued a Dodd-Frank whistleblower award of more than $500,000 to an unidentified company employee.  According to the SEC, the individual reported information that prompted an SEC investigation and resulted enforcement action by the agency.  Jane Norberg, Chief of the SEC’s Office of the Whistleblower stated that … Continue Reading

SEC Announces First Whistleblower Award During Trump Era

By Lloyd B. Chinn, Harris Mufson and McKenzie A. Wilson on Posted in Dodd Frank, SEC
On April 25, 2017, the Securities and Exchange Commission issued a Dodd-Frank whistleblower award of nearly $4 million.  This was the first bounty award that was issued from start-to-finish (i.e. from the preliminary determination stage through final order) since Trump’s inauguration.  To maintain the whistleblower’s confidentiality, the SEC declined to disclose the organization involved.  The agency did acknowledge, however, that … Continue Reading

Texas District Court Dismisses SOX Whistleblower Claim For Lack of Protected Activity

By Lloyd B. Chinn and Emilie Adams on Posted in Dodd Frank, SOX Whistleblower Decisions
On March 21, 2017, the Northern District of Texas dismissed a former employee’s whistleblower retaliation claim on the ground that her allegations of fraud were too far removed from potentially harming the shareholders of a publicly-traded company to be covered under SOX’s anti-retaliation protections. Brown v. Colonial Savings, F.A., No. 4:16-cv-00884 (N.D. Tex. Mar. 21, … Continue Reading

Ninth Circuit — Dodd-Frank Protects Internal Whistleblowers

By Lloyd B. Chinn and Emilie Adams on Posted in Dodd Frank
On March 8, 2017, a split three-judge panel of the Ninth Circuit Court of Appeals affirmed a Northern District of California decision declining to dismiss a Dodd-Frank whistleblower retaliation claim because the plaintiff did not report his concerns to the SEC. Somers v. Digital Realty Trust, 15-17352 (9th Cir. March 8, 2017).  The Ninth Circuit … Continue Reading

California District Court Addresses Whistleblower’s Self-Help

By Lloyd B. Chinn and Anthony DiBenedetto on Posted in Employee Document/Data Theft
In Erhart v. BofI Holding, Inc., Case No. 15-cv-02287, (S.D. Cal. Feb. 14, 2017), a bank’s internal auditor reported alleged misconduct to federal agencies, engaged in self-help discovery by appropriating the bank’s confidential information, and allegedly widely disseminated such information. When the bank alleged that this conduct violated the parties’ confidentiality agreement and state and … Continue Reading

Proskauer to Present on Managing Whistleblowing Employees at ABA Midwinter Meeting

By Lloyd B. Chinn on Posted in Best Practices, SOX Whistleblower Decisions
On Thursday March 23, 2017 at 9:00 a.m., Lloyd Chinn will speak on “Practical Advice and Tips for Managing Whistleblowing Employees: Where Do We Go After the Volcano Blows?” at the 2017 Midwinter Meeting of the ABA Section of Labor and Employment Law’s Employment Rights and Responsibilities Committee in Puerto Vallarta, Mexico. Chinn is a partner … Continue Reading

Proskauer Represents Employer Against Former Executive Found Liable for Snooping on Boss’s and Others’ Emails

By Lloyd B. Chinn and Jurate Schwartz on Posted in Computer Fraud and Abuse Act, Employee Document/Data Theft, State-Specific Whistleblower Claims, Stored Communications Act
A former employee of the upscale outdoor furniture designer and manufacturer Brown Jordan recently failed in his bid to pursue whistleblower retaliation claims against the company and also found himself liable for snooping on his boss’s (and other’s) emails. A three-judge panel of the Eleventh Circuit recently affirmed the District Court’s summary judgment for the employer … Continue Reading

CFTC Proposes New Amendments to its Whistleblower Rules

By Lloyd B. Chinn, Harris Mufson and Esther Pak on Posted in Dodd Frank
The U.S. Commodity Futures Trading Commission (“CFTC” or the “Commission”) has proposed numerous amendments to the Whistleblower Rules found in Part 165 of the CFTC’s Regulations. The Commission seeks to enhance the process for reviewing whistleblower claims and clarify staff authority to administer the whistleblower program through the proposed amendments. Significantly, the CFTC has proposed … Continue Reading

SEC Issues $22 Million Whistleblower Award

By Lloyd B. Chinn and Anthony DiBenedetto on Posted in Dodd Frank
On August 30, 2016, the SEC issued a $22 million whistleblower bounty award to an individual “whose detailed tip and extensive assistance helped the agency halt a well-hidden fraud” at the whistleblower’s employer. The Acting Chief of the SEC’s Office of the Whistleblower, credited the “company insider,” stating “[w]ithout this whistleblower’s courage, information, and assistance, it … Continue Reading

SEC Affirms Denial of Bounties to Three Purported Whistleblowers

By Lloyd B. Chinn, Harris Mufson and Andrew Sherwood on Posted in SEC
On July 19, 2016, the SEC issued an order upholding the SEC Claims Review Staff’s (“CRS”) Preliminary Determination denying three claims for whistleblower awards.  The SEC’s order explains how the claimants’ bounty requests were properly denied for failing to meet the SEC’s eligibility requirements.  As we have previously discussed here, all but a few whistleblower … Continue Reading

SEC Whistleblower Chief Sean McKessy to Leave, Agency Announces

By Lloyd B. Chinn, Harris Mufson and Andrew Sherwood on Posted in SEC
The SEC announced today the departure of Sean X. McKessy, Chief of the SEC’s Office of the Whistleblower.  Mr. McKessy was the first to hold that role and started his post in February 2011.  Mr. McKessy is credited with developing and establishing the Dodd-Frank whistleblower bounty program from complaint intake to prosecution to the payment of substantial … Continue Reading

SEC Issues $17 Million Whistleblower Award

By Lloyd B. Chinn and Kelly Anne Targett on Posted in SEC
Yesterday, the SEC issued a stunning $17 million award to a former employee, whose “detailed tip” provided original information to SEC enforcement staff that “substantially advanced their investigation” into the whistleblower’s former employer.  The SEC specifically credited the “company insider” with allowing enforcement staff “to conserve time and resources in the investigation, and help[ing] staff … Continue Reading

No Bounty For Purported Whistleblower Tipster

By Lloyd B. Chinn and Christopher Bouriat on Posted in Dodd Frank, SEC
On May 31, 2016, the U.S. Securities and Exchange Commission (“SEC”) issued an order upholding the SEC Claims Review Staff’s (“CRS”) Preliminary Determination denying a claim for a whistleblower award in connection with the enforcement action SEC v. CVS Caremark Corp.  Notice of Covered Action 2014-48 (“Covered Action”).  This order provides insight into a whistleblower … Continue Reading

Tennessee District Court Limits Scope of Dodd-Frank Whistleblower Claim

By Lloyd B. Chinn, Harris Mufson and Natalie Phillips on Posted in Dodd Frank, False Claims Act, SOX Whistleblower Decisions
The Eastern District of Tennessee recently dismissed whistleblower claims, finding that the Plaintiff was not entitled to protection under Sarbanes-Oxley, Dodd-Frank, or the False Claims Act (“FCA”).  Verble v. Morgan Stanley Smith Barney LLC et al., 3:15-cv-00074 (E.D. Tenn. Dec. 8, 2015).  The court’s decision illustrates the sharp divide amongst courts regarding the scope of … Continue Reading
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