By: Joseph Marrow
Recently, the United States Supreme Court heard oral argument in a whistleblower retaliation case. In Lawson v. FMR, LLC, the Supreme Court is faced with the question whether to expand the coverage of an anti-retaliation claim under Sarbanes-Oxley to an employee of a privately-held contractor (which provides investment management services to Fidelity mutual funds), a subsidiary of a public company. Pursuant to the Dodd-Frank Act, the Securities and Exchange Commission established an award program for whistleblowers creating a new private right of action for employees in the financial services sector who suffer retaliation for disclosing information about fraudulent or unlawful conduct related to the offering or provision of a consumer financial product or service. In the case on appeal to the Supreme Court, the First Circuit had ruled that the anti-retaliation provision only applies to employees of public companies. The Supreme Court must decide whether to expand the definition of the class protected by the statute to employees of privately-held companies. The decision is expected in the Spring of 2014.
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