Wednesday, March 05, 2014

Whistleblower protection extends to company contractors

  NPR yesterday morning related “the U.S. Supreme Court’s ruling that a federal whistleblower law, enacted after the collapse of Enron Corporation, protects not just the employees of a public company, but also company contractors like lawyers, accountants, and investment funds.”

  The case was  Lawson. Etal v. FMR LLC, Etal , Case 12–3.

   Justice  Ginsburg in delivering the opinion of the Court, concluded that §1514A’s whistleblower protection includes employees of a public company’s private contractors and subcontractors, writing in the syllabus that “to  safeguard  investors  in  public  companies  and  restore  trust  in  the financial  markets  following  the  collapse  of  Enron  Corporation,  Congress passed the Sarbanes-Oxley Act of 2002.  One of the Act’s provisions  protects  whistleblowers;  at  the  time  relevant  here,  that  provision  instructed:  “No  [public]  company  . . .,  or  any . . . contractor  [or] subcontractor . . . of such company, may discharge, demote, suspend, threaten,  harass,  or  . . .  discriminate  against  an  employee  in  the terms and conditions of employment because of [whistleblowing activity].”  18 U. S. C. §1514A(a).

  The  Court  looked  first  to  the  ordinary  meaning  of  the  provision’s language, Ginsburg further explained, referring to Moskal v. United States, 498 U. S. 103, 108 (1990) “As relevant here, §1514A(a) provides that “no . . . contractor . . . may discharge . . . an employee.”  The ordinary meaning of “an employee” in this proscription is the contractor’s own employee.  FMR’s “narrower construction” requires inserting “of a public company” after “an employee,” but where Congress meant “an employee of a public company,” it said so.”

  ScotusBlog’s Geoffrey Rapp posted an argument recapitulation and analysis of the case, and The Wall Street Journal, Forbes, the ABA Journal  and Reuters  were among them having articles.

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