On Wednesday, February 21, the U.S. Supreme Court issued a decision ruling that whistleblowers protected by the Sarbanes-Oxley Act and the Dodd-Frank Act are limited to employees who provide information concerning violations of those laws to the Securities and Exchange Commission. The ruling reversed a prior decision of the Ninth Circuit, which extended those whistleblower protections to include employees who internally reported violations of the Sarbanes-Oxley Act to their own employers, even if they had not provided information to the Securities and Exchange Commission.
The Sarbanes-Oxley Act of 2002 was enacted in the wake of the Enron and WorldCom scandals to protect investors and reduce fraud by increasing oversight of public companies by the Securities and Exchange Commission. Among other things, the 2010 Dodd-Frank Act implemented several provisions designed to encourage and protect whistleblowers who report violations of the Sarbanes-Oxley Act. It provided financial incentives to whistleblowers who convey original information to the Securities and Exchange Commission that result in fines or sanctions to the company (often referred to as the “bounty” provision). It also increased the protections against retaliation afforded to whistleblowers. Before the Court’s latest ruling, lower courts were split over whether an employee could qualify as a whistleblower under the anti-retaliation protections simply by reporting an alleged violation of the Sarbanes-Oxley Act...
Delta Air Lines agreed to pay $8.1 million over allegations it violated the False Claims Act by exceeding employee compensation limits it agreed to when taking federal pandemic aid money. The U.S....