Whistleblower Anti-Retaliation Provisions Clarified by Two Recent Rulings

Two recent judicial decisions provide useful insight into the scope and application of the whistleblower anti-retaliation provision contained in the Dodd-Frank Act. From attorney Cynthia Murray (Schnader): 

“On June 28, 2012, the U.S. District Court for the Southern District of Texas decided Asadi v. G.E. Energy (USA), LLC and held that the anti-retaliation provision of Dodd-Frank does not apply to whistleblower claims that occur outside of the United States… Judge Nancy F. Atlas dismissed Asadi’s claim on the ground that the anti-retaliation provision of Dodd-Frank does not apply to conduct outside of the territorial United States…

Less than two weeks after Asadi, the U.S. District Court for the Southern District of New York held that Section 929A of Dodd-Frank, which amended Section 806 of Sarbanes-Oxley, can apply retroactively to protect employees of non-public subsidiaries of publicly traded companies…

Before the enactment of Dodd-Frank, Section 806 provided for ‘[w]histleblower protection for employees of publicly traded companies.’ Section 929A of Dodd-Frank extended whistleblower protection to employees of non-public subsidiaries or affiliates ‘whose financial information is included in the consolidated financial statements of such [public] company.’” … The court concluded that Section 929A of Dodd-Frank merely clarified the existing anti-retaliation provision of Section 806 of Sarbanes-Oxley and therefore could apply retroactively.”

Read the full update, Recent Decisions Provide Guidance with Respect to the Application and Scope of Anti-Retaliation Provision of Dodd-Frank - Schnader Harrison Segal & Lewis LLP»