Tag Archives: SEC

SEC Awards Over $16 Million to Two Whistleblowers

On November 30, 2017, the SEC Office of the Whistleblower issued a bounty award of more than $16 million to two tipsters; each received an award of more than $8 million. The SEC denied awards to five other claimants. The first whistleblower provided original information, including the identity of relevant documents and witnesses, which became … Continue Reading

S.D. Fla. Refuses To Dismiss SOX and Dodd-Frank Whistleblower Claims

The Southern District of Florida recently denied a Rule 12(b)(6) motion to dismiss a former employee’s Sarbanes-Oxley and Dodd-Frank whistleblower retaliation claims, finding that the plaintiff sufficiently alleged that she had an objectively reasonable belief regarding alleged securities violations.  Thomas v. Tyco Int’l Mgmt. Co., LLC, No. 16-cv-80501 (Mar. 31, 2017).  This case is noteworthy … Continue Reading

E.D. Virginia Tosses Dodd-Frank Whistleblower Claim for Lack of SEC Complaint

The U.S. District Court for the Eastern District of Virginia recently granted a Rule 12(b)(6) motion to dismiss a Dodd-Frank whistleblower retaliation claim brought by an ex-project manager, finding that Plaintiff failed to allege that her protected activity involved any disclosures to the SEC.  Smith v. Raytheon Co., No. 17-cv-00438 (E.D. Va. Aug. 11, 2017).… Continue Reading

SEC Issues Award To Whistleblower Despite Culpability And Delay

On July 27, 2017, the SEC announced that it was paying a $1.7 million bounty award to a whistleblower, even though the whistleblower: (1) had some culpability in the fraud; (2) unreasonably delayed reporting the fraud; and (3) failed to comply with a Dodd-Frank rule requiring whistleblowers to submit inside information in writing in certain … Continue Reading

N.D. Illinois Dismisses Dodd-Frank Whistleblower Claim For Lack Of Complaint To The SEC

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 … Continue Reading

The First Hundred Days: Whistleblowing in the New Administration

With the new administration comes a new era for whistleblowing. High-risk whistleblower complaints implicating Dodd-Frank, Sarbanes-Oxley and similar state whistleblower retaliation statutes continue to rise. These complaints often rise to the highest levels of a company’s legal and compliance functions, as they present significant financial and reputational risks. Proskauer’s Lloyd Chinn and Harris Mufson recently … Continue Reading

Third Circuit Revives In-House Attorney’s Whistleblower Claim

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 … Continue Reading

SEC Reduces Whistleblower Bounty Based On Culpability And Delayed Reporting

On February 28, 2017, in an Order almost entirely devoid of detail, the SEC announced that a whistleblower will receive 20% of any monetary sanctions collected in an enforcement action commenced as a result of the whistleblower’s tip. The SEC is giving this “reduced” award while acknowledging that the whistleblower (1) was “culpable” in the … Continue Reading

Proskauer to Present on Modern Whistleblower Retaliation Law and the SEC Bounty Program at Bloomberg’s BNA Webinar

On Friday, March 3, 2017, Proskauer Partner Steve Pearlman will present on key aspects of modern whistleblower retaliation law, SEC enforcement actions involving “pre-taliation,” and the SEC Office of the Whistleblower bounty program. Pearlman is the co-head of the Whistleblowing & Retaliation Group.  He will join co-panelist Sean X. McKessy, Partner, Phillips & Cohen LLP, … Continue Reading

SEC Issues $17 Million Whistleblower Award

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

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

SEC Annual Report: Thousands of Tips, One Award & Minimal Transparency

In its Annual Report on the Dodd-Frank Whistleblower Program (Report), the SEC has revealed that it has received 3,001 tips during its 2012 fiscal year (the first year of this program), and it paid out its first award to a whistleblower in 2012. Pursuant to Section 922 of the Dodd-Frank Wall Street Reform and Consumer … Continue Reading

The Fight Isn’t Over: Employers Should Keep Battling The Definition of “Whistleblower” Under Dodd-Frank

The “Securities Whistleblower Incentives and Protection” section of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“DFA”) is an integrated scheme designed to encourage individuals to complain to the SEC of securities law violations by offering bounties and protection against retaliation.  The two components of this section are:  (i) a whistleblower bounty … Continue Reading
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