In an article titled Unprotected: How the feds failed two Wells Fargo whistleblowers, American Banker quotes leading whistleblower lawyer Jason Zuckerman about the challenges that some Wells Fargo whistleblowers have encountered pursuing retaliation claims.
The article discusses SOX whistleblower claims brought by two former Wells Fargo retailer bankers alleging that they suffered retaliation for disclosing a practice of opening accounts under clients’ names without their knowledge. Judge Wilken dismissed the SOX claims on summary judgment on the basis that Wells Fargo showed that both plaintiffs failed to meet sales goals. But we now know that Wells Fargo employees were pressured to meet sales goals by opening unauthorized accounts. Had the court scrutinized the evidence of the bank’s justification for the retaliatory actions more closely, it might have found that Wells Fargo was not justified in forcing employees to use improper tactics to meet sales goals.
The American Banker article cites Zuckerman’s observation that the court may have failed to apply the correct burden in finding that Wells Fargo established a same-decision affirmative defense:
While upheld on appeal, the judge’s decision looks flawed in the wake of the successive scandals that have engulfed Wells Fargo, said Jason Zuckerman, a whistleblower attorney unconnected with the Guitron and Klosek cases.
Wilken’s “ruling suggests an utter failure to apply the correct standard,” Zuckerman said. By law, Wells had to prove with “clear and convincing evidence,” a high standard, that it would have fired Guitron even if she had not blown the whistle.
To establish a same-decision affirmative decision, an employer must prove clearly and convincingly that it would have taken the same adverse employment action even if the employee had not engaged in protected activity. The operative phrase here is “would have.” An employer fails to meet its burden if it establishes merely that it could have taken the same adverse action. “Clear and convincing” evidence can be quantified as establishing the probability of a fact at issue “in the order of above 70%.” In light of that burden, judges should rarely grant summary judgment in this type of case where there is conflicting evidence about the basis for a retaliatory employment action. Instead, judges should respect the right to a jury trial and defer to juries to weigh evidence and make credibility determinations.
Recently two Wells Fargo prevailed in SOX whistleblower cases at the OSHA stage:
OSHA Orders Wells Fargo to Pay $5.4M to Whistleblower
Wells Fargo Whistleblower Prevails in OSHA Investigation of Retaliation Claims
To learn more about Sarbanes-Oxley whistleblower protection, download our free guide Sarbanes-Oxley Whistleblower Protection: Robust Protection for Corporate Whistleblowers.
And if you have original information about fraud that falls within the SEC’s jurisdiction, contact us to find our if you may qualify for a SEC whistleblower award. Download our free guide SEC Whistleblower Program: Tips from SEC Whistleblower Attorneys to Maximize an SEC Whistleblower Award.
