Tag: Whistleblower


The SEC’s First Risk Alert of Fiscal Year 2017 Targets Registrant Rule 21F-17 Compliance

Posted on November 8th, by Editor in Counseling & Compliance Training. Comments Off on The SEC’s First Risk Alert of Fiscal Year 2017 Targets Registrant Rule 21F-17 Compliance

By James G. Lundy, Shavaun Adams Taylor and Matthew M. Morrissey

The Securities and Exchange Commission (SEC or Commission) Office of Compliance Inspections and Examination (OCIE) issued a Risk Alert on October 24, 2016, titled “Examining Whistleblower Rule Compliance.” This recent Risk Alert continues the SEC’s aggressive efforts to compel Rule 21F-17 compliance and puts the investment management and broker-dealer industries on formal notice that OCIE intends to scrutinize registrants’ compliance with the whistleblower provisions of the Dodd–Frank Wall Street Reform and Consumer Protection Act (Dodd–Frank). By way of background, Dodd–Frank established a whistleblower protection program to encourage individuals to report possible violations of securities laws. Importantly, in addition to providing whistleblowers with financial incentives, Rule 21F-17 provides that no person may take action to impede a whistleblower from communicating directly with the SEC about potential securities law violations, including by … Read More »


SEC Charges Another Company for Anti-Whistleblower Provision in Severance Agreements

Posted on August 12th, by Editor in Audits/Due Diligence, Counseling & Compliance Training. Comments Off on SEC Charges Another Company for Anti-Whistleblower Provision in Severance Agreements

By Mary Hansen and Rachel Share

The SEC announced on Wednesday that BlueLinx Holdings Inc. has agreed to pay a $265,000 penalty for including a provision in its severance agreements that required outgoing employees to waive their rights to monetary recovery if they filed a charge or complaint with the SEC or other federal agencies. Press Rel. No. 2016-157. According to the SEC’s order, approximately 160 BlueLinx employees have signed severance agreements that contained the provision since it was added to all of BlueLinx’s severance agreements in or about June 2013.

The provision violates Rule 21F-17 of the Exchange Act, which became effective on August 12, 2011, and prohibits any action to impede an individual from communicating with the SEC about a possible securities law violation. The purpose of the adoption of Rule 21F-17 was “to encourage whistleblowers to report possible violations … Read More »


Bad News for Whistleblowers: New Jersey Supreme Court Rules Theft of Confidential Documents for Self-Help in Employment Lawsuit Can Result in Jail Time

Posted on July 13th, by Editor in Crisis Management. Comments Off on Bad News for Whistleblowers: New Jersey Supreme Court Rules Theft of Confidential Documents for Self-Help in Employment Lawsuit Can Result in Jail Time

By Lynne Anne Anderson

Does an employee have an unfettered right to take confidential documents from her employer to use in her discrimination and retaliation lawsuit against the employer? Not in New Jersey. The New Jersey Supreme Court recently ruled in State v. Ivonne Saavedra that the theft of a company’s confidential documents for self-help in an employment lawsuit can result in jail time.

Florham Park partner Lynne Anderson recently published an article in Law360 discussing the decision and its ramifications for employers and would-be whistleblowers.

Read “Woe To The NJ Whistleblower Who Whisks Away Documents” here.


Whistleblower and Retaliation Claims Compliance, Risk and Prevention

Posted on August 18th, by Editor in Counseling & Compliance Training. Comments Off on Whistleblower and Retaliation Claims Compliance, Risk and Prevention

Whistleblower and Retaliation claims continue to rise and general counsel of companies large and small are increasingly budgeting for the prevention and defense of these claims.  The multitude of regulations governing industries including pharma, life sciences healthcare, insurance and financial services, present employees with numerous opportunities, sometimes even incentives, to threaten and file whistleblower and retaliation claims.  Launch the brief video below to hear how Labor and Employment Group partners Tom Barton and Lynne Anderson are helping employers achieve a culture of compliance to minimize risk, as well as the Labor & Employment group’s proven track record of success in helping employers handle and defend against these claims.

 


New Jersey’s Whistleblower Law Is Not An End Run Around Labor Law Preemption

Posted on April 23rd, by Editor in Counseling & Compliance Training. Comments Off on New Jersey’s Whistleblower Law Is Not An End Run Around Labor Law Preemption

By: Meredith R. Murphy

New Jersey’s Appellate Division has rejected two Atlantic City nightclub workers’ attempts to artfully plead their way around preemption under the National Labor Relations Act (NLRA) and the Labor Management Relations Act (LMRA) by alleging a whistleblower claim under New Jersey’s Conscientious Employee Protection Act (CEPA). The case was brought by two “Tipped Floor Euros,” i.e., alcoholic beverage servers, who alleged retaliation and constructive discharge following their complaints regarding tip-pooling, wage payments and being forced to perform duties prohibited by the collective bargaining agreement (CBA). The case is O’Donnell v. Nightlife, et al. (April 17, 2014).

In rejecting the plaintiffs’ CEPA claims, the Appellate Division took a narrow view of the whistleblower statute, citing the standard that the conduct complained of must “pose a threat of public harm, not merely private harm or harm only to the aggrieved employee.” … Read More »


Supreme Court Expands Scope of Sarbanes-Oxley Whistleblower Protections

Posted on April 21st, by Editor in Counseling & Compliance Training. Comments Off on Supreme Court Expands Scope of Sarbanes-Oxley Whistleblower Protections

Editor’s Note: The following post by Alexis Burgess, Associate in the Los Angeles office, appears in the latest issue of the California HR Newsletter. To sign-up to receive the California HR Newsletter click here.

Supreme Court Expands Scope of Sarbanes-Oxley Whistleblower Protections

The Issue: My company is not publicly traded, but provides services to companies that are. Do Sarbanes-Oxley whistleblower protections extend to our employees?

The Solution: Yes.

Analysis: Enacted in the wake of the Enron and Worldcom scandals, the Sarbanes-Oxley Act imposes increased reporting standards on publicly-traded companies and the outside accountants, consultants, and lawyers supporting them. Section 1514A prohibits public companies, or their contractors or agents, from using adverse employment action, threat, or harassment to retaliate against “an employee” who blows the whistle (internally or externally) on perceived violations of the Act, SEC regulation, or any other federal law relating to shareholder fraud. Though civil remedies are … Read More »


Whistleblowing May Not Be Limited to Claims About Employer Wrongdoing in New Jersey

Posted on May 21st, by Editor in Counseling & Compliance Training. Comments Off on Whistleblowing May Not Be Limited to Claims About Employer Wrongdoing in New Jersey

By: Jerrold J. Wohlgemuth

The New Jersey Conscientious Employee Protection Act (“CEPA”) was designed to protect whistleblowing employees who have the courage to stand up to illegal or wrongful conduct by their employer.  As the courts have consistently held, the initial focus in a typical CEPA case is on the whistleblower’s prima facie case burden to establish that he/she had an objectively reasonable basis to believe that the employer did something wrong by either violating a law or engaging in conduct incompatible with a clear mandate of public policy.

In an unreported opinion issued in March 2013, however, the United States District Court for the District of New Jersey found that CEPA can be implicated even where there is no claim or contention that the employer did anything wrong.  In Stapleton v. DSW, Inc. (2013 U.S. Dist. LEXIS 38502), the plaintiff employee believed … Read More »


Blowing The Wrong Whistle – Close Scrutiny Of Code Of Ethics Dooms Nurse’s Lawsuit Under New Jersey’s Whistleblower Statute

Posted on April 4th, by Editor in Counseling & Compliance Training. Comments Off on Blowing The Wrong Whistle – Close Scrutiny Of Code Of Ethics Dooms Nurse’s Lawsuit Under New Jersey’s Whistleblower Statute

By: Lawrence J. Del Rossi

New Jersey’s Conscientious Employee Protection Act (CEPA) is remedial legislation designed to protect employees who “blow the whistle” on illegal or unethical activity committed by their employers or co-workers.  To be sure, CEPA is a powerful anti-retaliation statute, providing an array of significant remedies to an aggrieved party.  However, as the saying goes, with great power comes great responsibility.  A recent decision by the Appellate Division, Hitesman v. Bridgeway, Inc. (decided March 22, 2013), highlights the important gatekeeping functions of trial courts in CEPA cases.  Click here for a copy of Hitesman. http://www.judiciary.state.nj.us/opinions/a0140-11.pdf.

Not every employee who “blows a whistle” is a “whistleblower” subject to the protections of CEPA.  An employee who lacks an objectively reasonable belief that his or her employer’s conduct violated a law or public policy or constituted improper quality of patient care cannot, … Read More »


New Year, New Laws for California Employers – Added Whistle-blower Protections, With Whom Will the EDD Share Employer Reports and Contracts with Commission Employees

Posted on December 26th, by Editor in Audits/Due Diligence, Counseling & Compliance Training. Comments Off on New Year, New Laws for California Employers – Added Whistle-blower Protections, With Whom Will the EDD Share Employer Reports and Contracts with Commission Employees

Continuing with our series “New Year, New Laws for California Employers,” we take a look at newly added whistle-blower protections, with whom the EDD will share employer reports and contracts with commission employees.  Prepared by  Mark Terman, partner in the Los Angeles office, this series looks at some of the significant new regulations becoming law in 2013 affecting private employers doing business in California.

Added Whistle-blower Protections

The California False Claims Act prohibits submission to the government of a false claim for money, property or services, and authorizes actions for treble damages and penalties. An example could be charging a government entity for goods or services that were not provided.

Employees, as “relators,” can inform the government or law enforcement, participate in these actions after satisfying certain requirements and share in the recovery.  Employers cannot prevent employees from disclosing information to the government … Read More »


The Birth of Dodd-Frank Whistleblower Actions

Posted on October 1st, by Editor in Counseling & Compliance Training. Comments Off on The Birth of Dodd-Frank Whistleblower Actions

By: Meredith R. Murphy

In what many are calling the first Dodd-Frank retaliation suit to survive a Rule 12(b)(6) motion to dismiss, the United States District Court for the District of Connecticut issued a ruling permitting a terminated Human Resources manager’s retaliation claim to proceed.  In Kramer v. Trans-Lux Corp. (to read the full opinion click here), the plaintiff’s Dodd-Frank retaliation claim is based on his termination allegedly caused by his written complaints – one to the company’s CEO, another to the Board’s audit committee and, finally, a complaint to the SEC –  that the company was violating its pension plan.

Much of the argument in the case hinged on whether Kramer’s method of reporting to the SEC – sending a letter to the SEC via regular mail – was sufficient to trigger Dodd-Frank’s anti-retaliation provisions.  Specifically, the defendant employer insisted that … Read More »




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