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Category Archives: SOX Whistleblower Decisions

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M.D. Pennsylvania Grants Summary Judgment on SOX Retaliation Claim

By Steven J. Pearlman, Pinchos Goldberg and Shanice Z. Smith-Banks on Posted in SOX Whistleblower Decisions
On April 12, 2021, the U.S. District Court for the Middle District of Pennsylvania granted a defendant-employer’s motion for summary judgment on a SOX whistleblower retaliation claim, holding that the company demonstrated that it would have terminated Plaintiff’s employment even in the absence of any alleged protected activity as part of a broad reduction-in-force (RIF).  … Continue Reading

Pennsylvania District Court Grants Employer Summary Judgment on SOX Claim

By Steven J. Pearlman, Pinchos Goldberg and Rebecca Fishbein on Posted in SOX Whistleblower Decisions
On March 29, 2021, the U.S. District Court for the Eastern District of Pennsylvania granted a defendant-employer’s motion for summary judgment on a SOX whistleblower retaliation claim, holding that the plaintiff lacked an objectively or subjectively reasonable belief that the company violated any law enumerated in Section 806 of SOX.  Ngai v. Urban Outfitters, Inc., … Continue Reading

7th Circuit Affirms Denial of Equitable Tolling of Statute of Limitations Under SOX

By Steven J. Pearlman, Pinchos Goldberg and Scott Tan on Posted in SOX Whistleblower Decisions
On March 22, 2021, the Seventh Circuit affirmed a decision by the ARB dismissing a whistleblower retaliation complaint under SOX for failure to file within the 180-day statutory deadline.  Xanthopoulos v. U.S. Department of Labor, No. 20-2604.  The court rejected the plaintiff’s equitable tolling arguments. Background Plaintiff was an employee of an investment company, and … Continue Reading

Fifth Circuit Affirms Dismissal of SOX Whistleblower Claim for Lack of Employer-Employee Relationship

By Steven J. Pearlman, Pinchos Goldberg and Rebecca Fishbein on Posted in SOX Whistleblower Decisions
On January 29, 2021, the U.S. Court of Appeals for the Fifth Circuit affirmed the dismissal of a SOX whistleblower retaliation claim where the plaintiff failed to establish an employer-employee relationship with the defendant.  Moody v. Am. Nat’l Ins. Co., No. 20-cv-40462. Background Plaintiff was the owner and president of Moody Insurance Group (“MIG”).  MIG … Continue Reading

Ga. District Court Dismisses Dodd-Frank and SOX Whistleblower Claims

By Steven J. Pearlman, Pinchos Goldberg and Melissa A. Overbeck on Posted in Dodd Frank, SOX Whistleblower Decisions
On September 30, 2020, the U.S. District Court for the Northern District of Georgia granted an employer’s motion to dismiss a Dodd-Frank whistleblower claim on the ground that the alleged whistleblower did not complain to the SEC prior to his termination.  The court also granted Plaintiff’s SOX whistleblower claim as against three affiliates of Plaintiff’s … Continue Reading

Third Circuit Confirms Limits on Scope of Protected Activity Under SOX

By Steven J. Pearlman, Pinchos Goldberg and Scott Tan on Posted in SOX Whistleblower Decisions
On July 16, 2020, the Third Circuit affirmed the dismissal of a former IT analyst’s whistleblower retaliation claim, holding that he lacked an objectively reasonable belief that his complaints implicated one of the enumerated forms of fraud in the SOX whistleblower provision.  Reilly v. GlaxoSmithKline, LLC, No. 19-cv-2897. Background Plaintiff was an IT analyst for … Continue Reading

Texas District Court Dismisses SOX Whistleblower Claim for Lack of Employer-Employee Relationship

By Lloyd B. Chinn, Pinchos Goldberg and Alex Downie on Posted in SOX Whistleblower Decisions
On June 12, 2020, the U.S. District Court for the Southern District of Texas granted a motion to dismiss in favor of the defendant in a SOX whistleblower retaliation case, finding that the alleged whistleblower – a contractor and advisory board member of the defendant – was not an employee of the defendant, as required … Continue Reading

Pennsylvania Magistrate Judge Recommends Dismissal of SOX Whistleblower Claim for Lack of Protected Activity

By Steven J. Pearlman, Pinchos Goldberg and Heylee Bernstein on Posted in SOX Whistleblower Decisions
On May 5, 2020, a Magistrate Judge in the U.S. District Court for the Western District of Pennsylvania issued a report and recommendation recommending that a defendant-employer’s motion for summary judgment dismissing a SOX whistleblower retaliation claim be granted, finding that the plaintiff had not engaged in protected activity.  Wutherich v. Rice Energy Inc, No. … Continue Reading

DOL Decision Confirms Extraterritorial Limits of SOX Whistleblower Provision

By Harris Mufson, Pinchos Goldberg and Dominique Kilmartin on Posted in DOL Decisions, SOX Whistleblower Decisions
As we previously reported, the Department of Labor’s (DOL) Administrative Review Board has twice held that Sarbanes Oxley’s anti-retaliation provision does not apply extraterritorially.  See Hu v. PTC, Inc., ARB Case No. 2017-0068 (Sept. 18, 2019); Perez v. Citigroup, Inc., ARB Case No. 2017-0031 (Sept. 30, 2019).  An Administrative Law Judge (ALJ) of the DOL … Continue Reading

SDNY: Directors Not Liable For Whistleblower Claims Under SOX

By Steven J. Pearlman, Pinchos Goldberg and Scott Tan on Posted in SOX Whistleblower Decisions
On December 9, 2019, the U.S. District Court for the Southern District of New York ruled that, as a matter of law, directors cannot be held liable under the anti-retaliation provisions of the Sarbanes-Oxley Act.  Zornoza v. Terraform Global Inc., No. 18-cv-11617. Background Plaintiff is the former President and CEO of the defendant companies which … Continue Reading

ARB: SOX Whistleblower Provision Does Not Apply Extraterritorially

By Harris Mufson and Allison Martin on Posted in Key ARB Decisions, SOX Whistleblower Decisions
In a pair of recently issued decisions, the Department of Labor’s Administrative Review Board (ARB) held that Sarbanes Oxley’s anti-retaliation provision does not apply extraterritorially.  Hu v. PTC, Inc., ARB Case No. 2017-0068 (Sept. 18, 2019); Perez v. Citigroup, Inc., ARB Case No. 2017-0031 (Sept. 30, 2019). Hu Decision In Hu, the complainant worked entirely … Continue Reading

SDNY Grants Motion to Dismiss SOX Retaliation Claim

By Steven J. Pearlman and Jacob L. Hirsch on Posted in SOX Whistleblower Decisions
On September 18, 2019, the U.S. District Court for the Southern District of New York granted a defendant-employer’s motion to dismiss a SOX whistleblower retaliation claim, finding that the plaintiff failed to adequately plead protected activity.  Tonra v. Kadmon Holdings, Inc., No. 18-cv-9028. Background The defendant-employer is a publicly traded biopharmaceutical company that develops and … Continue Reading

District of Rhode Island Dismisses In-House Attorney’s SOX Whistleblower Claim for Lack of Protected Activity

By Steven J. Pearlman, Pinchos Goldberg and Tony S. Martinez on Posted in SOX Whistleblower Decisions
On July 19, 2019, the U.S. District Court for the District of Rhode Island granted an employer’s motion to dismiss a SOX whistleblower claim, holding that the Plaintiff—an in-house attorney—failed to allege sufficient facts to show he had an objectively reasonable belief that fraud had occurred.  Colesanti v. Dickinson, No. 18-491. Background Plaintiff was an … Continue Reading

ARB Affirms Dismissal of SOX Whistleblower Claim Against Non-Public Companies

By Steven J. Pearlman and Allison Martin on Posted in Key ARB Decisions, SOX Whistleblower Decisions
The ARB recently affirmed the dismissal of a whistleblower retaliation claim under Section 806 of SOX, holding an employer is not a “contractor” covered by SOX simply because it was a party to a contract with a publicly traded company.  Griffo v. Book Dog Books, LLC, Robert William Holdings, LLC & Robert William Mgmt., LLC, … Continue Reading

Eastern District of Pennsylvania Grants Summary Judgment on SOX Claim

By Lloyd B. Chinn, Tony S. Martinez and Pinchos Goldberg on Posted in SOX Whistleblower Decisions
On July 18, 2019, the U.S. District Court for the Eastern District of Pennsylvania granted a defendant-employer’s motion for summary judgment on a SOX whistleblower retaliation claim, holding that the Plaintiff did not have an objectively reasonable belief that the defendant violated any SEC regulation.  Reilly v. Glaxosmithkline, LLC, No. 17-cv-2045. Background Plaintiff worked in … Continue Reading

4th Circuit Vacates ARB SOX Whistleblower Decision for Lack of Protected Activity

By Steven J. Pearlman, H. Ren Morris and Pinchos Goldberg on Posted in SOX Whistleblower Decisions
On June 13, 2019, the Fourth Circuit overturned the ARB’s decision in favor of a complainant, ruling that the plaintiff had not engaged in protected activity under the SOX whistleblower protection provision by complaining of a company’s use of a mandatory arbitration policy that allegedly was overly broad.  Northrop Grumman Systems Corp. v. U.S. Dep’t … Continue Reading

SDNY Dismisses SOX and Dodd-Frank Whistleblower Claims Against Private Company

By Steven J. Pearlman, Jacob L. Hirsch and Pinchos Goldberg on Posted in Dodd Frank, SOX Whistleblower Decisions
On June 3, 2019, the U.S. District Court for the Southern District of New York granted a defendant-employer’s motion for summary judgment on SOX and Dodd-Frank whistleblower retaliation claims, finding that the alleged whistleblowing did not involve fraud related to a public company.  Tellez v. OTG Interactive, LLC, No. 15-cv-8984. Background Defendants operate restaurants and … Continue Reading

Update on Bofl SOX Whistleblower Litigation

By Lloyd B. Chinn, Pinchos Goldberg and Annabel Pollioni on Posted in SOX Whistleblower Decisions
This is an update on our previous blog posts regarding the Erhart v. BofI Holding, Inc. case. We previously reported in October 2017 and March 2017 on a whistleblower litigation brought by Charles Erhart, a former Bank of Internet Holding, Inc. (Bofl) internal auditor.  In late 2018, the parties filed cross-motions for judgement on the … Continue Reading

Alabama Federal Court Denies Motion for Summary Judgement on SOX Whistleblower Claim

By Steven J. Pearlman, Pinchos Goldberg and Samantha Shear on Posted in SOX Whistleblower Decisions
On April 2, 2019, the U.S. District Court for the Northern District of Alabama denied a defendant-employer’s motion for summary judgment on a SOX whistleblower retaliation claim, finding genuine issues of material fact existed as to the basis for Plaintiff’s discharge, whether his complaint qualified as protected activity, and whether he had a reasonable belief … Continue Reading

Ninth Circuit Affirms Most of Jury Verdict in Former GC’s SOX Whistleblower Lawsuit

By Steven J. Pearlman, Lloyd B. Chinn and Pinchos Goldberg on Posted in Foreign Corrupt Practices Act, SOX Whistleblower Decisions
On February 26, 2019, the Ninth Circuit affirmed much of a jury’s approximately $11M verdict finding that a former general counsel was discharged in retaliation for reporting alleged Foreign Corrupt Practices Act (“FCPA”) violations.  Wadler v. Bio-Rad Labs., Inc., No. 17-cv-16193. Background Sanford Wadler, then the former General Counsel of Bio-Rad Laboratories, Inc. (the “Company”) … Continue Reading

Fifth Circuit Affirms Summary Judgment on SOX Whistleblower Claim

By Steven J. Pearlman, Lloyd B. Chinn and Edward Young on Posted in SOX Whistleblower Decisions
On February 15, 2019, the Fifth Circuit affirmed the grant of summary judgment in favor of Andeavor Corporation f/k/a Tesoro Corporation on a SOX whistleblower claim, concluding that the plaintiff lacked an objectively reasonable belief that the company was misreporting its revenue to the SEC.  Wallace v. Andeavor Corp., No. 17-cv-50927. Background Plaintiff, a Vice … Continue Reading

California Federal Court Stays SOX Claim Pending Arbitration of Related Claims

By Lloyd B. Chinn, Pinchos Goldberg, Tony S. Martinez and Steven J. Pearlman on Posted in SOX Whistleblower Decisions
On December 21, 2018, the U.S. District Court for the Northern District of California stayed a plaintiff’s whistleblower retaliation claim under SOX (which was not subject to mandatory arbitration) while granting a motion compelling arbitration of the plaintiff’s remaining employment discrimination and retaliation claims. Anderson v. Salesforce.com, Inc., No. 18-cv-06712-PJH. Background Plaintiff alleged that he … Continue Reading

Federal Court Allows SOX Whistleblower Claim To Proceed But Dismisses Dodd-Frank Claim

By Steven J. Pearlman and Annabel Pollioni on Posted in SOX Whistleblower Decisions
On October 2, 2018, the U.S. District Court for the Western District of Pennsylvania federal court denied a Rule 12(b)(6) motion to dismiss a SOX whistleblower retaliation claim, reasoning that Plaintiff sufficiently alleged that he engaged in protected activity and that his protected activity was a contributing factor in his termination.  But it dismissed the … Continue Reading

Third Circuit Affirms Dismissal of SOX Whistleblower Suit

By Harris Mufson and Jay M. Cohen on Posted in SOX Whistleblower Decisions
On June 27, 2018, the U.S. Court of Appeals for the Third Circuit affirmed the dismissal on summary judgment of a SOX whistleblower retaliation claim, concluding that the Plaintiff’s purported belief that the Defendant had committed fraud was not objectively reasonable. Westawski v. Merck & Co., No. 16-4075, 2018 WL 3159093 (3d Cir. June 27, … Continue Reading
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