Last month, the U.S. Court of Appeals for the Seventh Circuit affirmed summary judgement against an employee-whistleblower who had claimed that her former employer retaliated against her in violation of the False Claims Act’s (FCA) whistleblower protection provision. Lam v. Springs Window Fashions, LLC, 37 F.4th 431 (7th Cir. 2022). The court held that her former employer’s conduct fell short of “harassment” protected under the statute and that she failed to establish a causal connection between her informing management of potential false claims issues and her eventual termination. While the Seventh Circuit declined to adopt a strict test for the meaning of “harassment,” its holding shows that the court believes that harassment requires significant conduct to be actionable under the FCA.
Jennifer Lam, the employee-whistleblower, began working at defendant Springs in January 2019. In her role with Springs, she oversaw the global fabric inventory and tariffs on these fabrics. Springs discovered a possible tariff problem as Lam believed a specific fabric had originated in China, instead of the manufacturer designation of Taiwan/Malaysia, which, based on new country-of-original regulations, would require Springs to pay a steep 25 percent tariff on the fabric. Lam alleged that Springs was informed about this issue by her predecessor, who had been reprimanded and forced to resign.
Lam contends that she communicated her tariff concerns to the CEO at three meetings between June...
; ; ; agreed to pay $17.07 million to settle federal allegations of illegal diversity, equity and inclusion (DEI) hiring practices on Friday, marking the Justice Department's first resolution unde...