State-Specific Whistleblower Claims

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On June 7, 2017, the U.S. District Court for the Northern District of Illinois dismissed a whistleblower retaliation claim under the Dodd-Frank Act because the plaintiff failed to report his complaint of alleged securities violations to the SEC. Martensen v. Chicago Stock Exchange, Case No. 17-cv-1494 (N.D. Ill.) (Shadur, J.)

Plaintiff worked as a supervisor at the Chicago Stock Exchange’s Market Regulation Trading Examinations Unit. He alleged that his employment was terminated in violation of Dodd-Frank’s whistleblower protection provision after he complained to his superiors regarding alleged securities violations.

On April 12, 2017, the Third Circuit partially revived a former in-house attorney’s whistleblower retaliation lawsuit against his previous employer.  Danon v. Vanguard Group, Inc., No. 16-cv-2881.

Plaintiff, a former in-house tax lawyer, previously raised retaliation claims against the Company in New York State Court under the New York False Claims Act, alleging he was discharged in retaliation for informing senior employees of his belief that the Company was violating certain tax and corporate laws.  The state court dismissed the case based on the plaintiff’s failure to demonstrate that the Company knew he was involved in any protected conduct at the time of his termination.  Plaintiff then filed suit against the Company in the District Court for the Eastern District of Pennsylvania alleging whistleblower retaliation in violation of SOX, Dodd-Frank, and the Pennsylvania Whistleblower Law.  His claims again were dismissed because the court determined he was precluded from asserting the Company’s knowledge of his allegedly protected conduct (we previously wrote about the SEC’s amicus brief to the district court in support of the plaintiff’s arguments here).

The Middle District of Florida recently held that to establish a prima facie case under the Florida Private Whistleblower Act (FWA), § 448.102(3), Fla. Stat., a plaintiff must show an actual violation of a law, rule or regulation. Graddy v. Wal–Mart Stores E., LP, No. 5:16-CV-9-OC-28PRL (M.D. Fla. Feb. 14, 2017).

11th cir 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 on the former employee’s purported whistleblower claim, concluding that his report of alleged “misconduct” by his employer’s senior management was not actionable. In their unanimous decision, the judges also affirmed the District Court’s judgment in favor of the employer under the Stored Communications Act (SCA) and Computer Fraud and Abuse Act (CFAA) due to the employee’s spying on the emails of his superiors, colleagues, and subordinates without authorization over a period of months. While both the former employee and former employer traded accusations of wrongdoing during the course of the litigation, after summary judgment, trial and appeal, it is only Carmicle, the former employee, who has been found by the district court and the circuit to have done anything improper. Carmicle v. Brown Jordan Int’l, Inc., et al., No. 16-11350 (11th Cir. Jan. 25, 2017)

illOn March 2, 2016, an Illinois Appellate court upheld a jury verdict awarding over $3 million to Plaintiff James Crowley (Plaintiff) on his whistleblower retaliation claim under the Illinois State Official and Employee Ethics Act (Ethics Act) (5 ILCS § 430/15-5, et seq.).  Crowley v. Watson, No. 1-14-2847 (Mar. 2, 2016). We previously reported on the progression of the case here and here.

ndilTwo courts in the Northern District of Illinois recently ruled that the Illinois Whistleblower Act (IWA) (740 ILCS § 174/5) provides for individual liability.  Bello v. Village of Skokie, No. 14-cv-1718 (N.D. Ill. Sept. 2, 2014 and Dec. 31, 2015); Hower v. Cook County Sheriff’s Office, No. 15-cv-6404 (N.D. Ill. Feb. 16, 2016).

ndilOn October 29, 2015, the Northern District of Illinois concluded that an employee who called police regarding suspected shoplifting—in violation of company policy—succeeded in proving a claim under the Illinois Whistleblower Act (IWA).  Coffey v. DSW Shoe Warehouse, Inc., No. 14-cv-4365.  The court granted the Plaintiff’s motion for summary judgment and denied the Defendant’s motion for summary judgment, rejecting the Defendant’s argument that the Act protects only employees who report their employer’s bad actions only—and not the actions of third-parties.

caIn Cardenas v. M. Fanaian, D.D.S., Inc., Case No. F069305 (Cal. App. 5 Dist.), a California Court of Appeal determined that Plaintiff Cardenas could pursue a California Labor Code Section 1102.5 retaliation claim against her former employer, M. Fanaian, D.D.S., Inc. (“Company”) based on her allegation that it discharged her because she reported her coworker’s alleged theft of her property to law enforcement authorities—a complaint that did not implicate any wrongdoing by the Company itself.

sanctionsThe New Jersey Appellate Division recently upheld sanctions of more than $191,000 to Sunhillo Corporation (Company) in connection with its defense of claims under the New Jersey Conscientious Employee Protection Act, Fulton v. Sunhillo Corp., No. A-3950-13T2, 2015 WL 4390550 (N.J. Super. Ct. App. Div. Jul. 20, 2015), finding the whistleblower claims frivolous.