Tackling the tricky issue of how a plaintiff proves an employer's “intent,” in an opinion issued today, the United States Supreme Court unanimously held that under the Sarbanes-Oxley Act of 2002, corporate whistleblowers have to prove that their whistleblowing contributed to their employers' actions against them, but that burden does not require proof that an employer's specific motive was retaliation.
Sarbanes-Oxley was passed in the wake of the Enron scandal to identify and remedy corporate fraud, with a specific focus on preventing “corporate codes of silence” from discouraging employees from reporting corporate wrongdoing. Sarbanes-Oxley prohibits publicly traded companies from retaliating against employees – discharging, demoting, harassing, etc. -- “because of” protected whistleblowing activity. The whistleblower employee initially must demonstrate that his or her protected conduct was a “contributing factor” in the unfavorable action. The burden then shifts to the employer to show that it would have taken the personnel action irrespective of the protected whistleblowing activity.
Murray was a UBS employee responsible for reporting on commercial mortgage-backed securities markets to current and future UBS customers. Securities and Exchange Commission (SEC) regulations required that Murray's reports be independent and accurate reflections of his own views. Murray alleged that he was pressured to alter the content of his articles and clear them with the trading desk...
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