FAQs Archive

Does subjecting an employee to heightened scrutiny evidence retaliation?

Where an employer jumps on an employee’s first instance of misconduct or poor performance and subjects the employee to heightened scrutiny, the employer’s reliance on that alleged change in performance can be deemed a pretext for retaliation.

What damages can a whistleblower recover under the Sarbanes-Oxley Act?

A prevailing SOX whistleblower can recover “all relief necessary to make the employee whole,” which includes:

back pay (lost wages and benefits);
reinstatement with the same seniority that the employee would have had, were it not for the retaliation;
special damages (damages for impairment of reputation, personal humiliation, mental anguish and suffering, and other noneconomic harm that results from retaliation); and
attorney’s fees, and costs

If reinstatement is not feasible, can a judge award front pay in lieu of reinstatement?

Although reinstatement is the preferred and presumptive remedy to make an employee whole, some SOX whistleblowers have recovered front pay in lieu of reinstatement. In Hagman v. Washington Mutual Bank, Inc., an ALJ awarded $640,000 in front pay to a banker whose supervisor became verbally and physically threatening when the banker disclosed concerns about the short funding of construction loans.

Does SOX authorize an award of punitive damages?

Does SOX authorize an award of punitive damages? The SOX whistleblower protection law does not authorize punitive damages, but it does authorize uncapped special damages, … Continued

Is retaliation that occurred outside of the statute-of-limitations period relevant evidence of retaliation?

Retaliatory acts outside the statute-of-limitations are relevant evidence of retaliation Discrete conduct occurring outside the statute of limitations may be circumstantial evidence of retaliation. An … Continued

Does SOX prohibit post-termination retaliation?

The ARB and some district judges have held that SOX prohibits post-employment retaliation. For example, in Kshetrapal v. Dish Network, LLC,[i] Mr. Kshetrapal, an associate director for Dish Network (“Dish”), disclosed that a marketing agency with which Dish had contracted was submitting fraudulent bills. When Mr. Kshetrapal disclosed the fraud, his supervisors initially ignored him. Mr. Kshetrapal continued to press the issue, and Dish conducted an investigation, which resulted in Dish firing Mr. Kshetrapal’s supervisor and terminating its contract with the marketing agency. One month after taking these corrective actions, Dish forced Mr. Kshetrapal to resign.

Does SOX prohibit employers from “outing” confidential whistleblowers?

Disclosing a whistleblower’s identity may constitute an adverse employment action. The U.S. Court of Appeals for the Fifth Circuit reached this conclusion in a SOX case brought by Anthony Menendez, a former director in Halliburton Inc.’s finance and accounting department.

Is constructive discharge a prohibited act of retaliation under SOX?

Is constructive discharge a prohibited act of retaliation under SOX? Retaliatory termination goes beyond “You’re fired!” Under the SOX whistleblower protection law, constructive discharge … Continued

Image of Must a whistleblower prove that the individual who made the final decision to take the adverse action has personal knowledge of the whistleblower’s protected activity?

Must a whistleblower prove that the individual who made the final decision to take the adverse action has personal knowledge of the whistleblower’s protected activity?

Establishing Knowledge of SOX Protected Conduct The second element of a SOX claim is knowledge of protected conduct. A whistleblower may establish employer knowledge by … Continued

Are disclosures made in the course of performing one’s job duties protected?

Disclosures made in the course of performing one’s job duties are protected under the SOX whistleblower law A consensus is emerging that the duty … Continued

What are some types of proof to show that a disclosure is objectively reasonable?

Proving that a Disclosure is Objectively Reasonable Some of the options to prove that a disclosure was objectively reasonable include 1) showing that the SEC … Continued

Are SOX whistleblowers required to show that their disclosures relate “definitively and specifically” to a federal securities law?

SOX Whistleblowers are not required to show that their disclosures relate “definitively and specifically” to a federal securities law To be protected under the SOX … Continued

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