Category: Whistleblower Systems

$1.9 Million to Whistleblower CFO

The U.S. Department of Labor’s Occupational Safety and Health Administration (“OSHA”) ordered Clean Diesel Technologies Inc.(“CDTI”) to pay $1.9 million to its former chief financial officer in association with a violation of the whistleblower provisions of the Sarbanes-Oxley Act. OSHA determined that CDTI wrongfully terminated the former CFO in April 2010 after he warned the board …

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Whistleblower’s litigation costs are deemed deductible business expenses

A federal district court, in the matter of Bagley, No. 2:10-cv-00483-RT-FMO (C.D. Cal. 8/5/13), has determined that Richard Bagley was engaged in the trade or business of pursuing False Claims Act lawsuits against his former employer and was thereby entitled to deduct legal expenses related to that endeavor as ordinary and necessary business expenses. The False Claims Act (FCA) …

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Permanent link to this article: http://betweenthenumbers.net/2013/08/whistleblowers-litigation-costs-are-deemed-deductible-business-expenses/

Top Five All-Time Biggest Whistleblowers

Managing a Sarbanes-Oxley compliant whistleblower hotline allows me to have significant interaction with whistleblowers.  So I was very interested in the article written by Steve Kardell of Clouse Dunn LLP, which describes five of the most prominent whistleblowers of all time, as follows: “Daniel Ellsberg Daniel Ellsberg was a Harvard graduate, Marine lieutenant, Pentagon official …

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Permanent link to this article: http://betweenthenumbers.net/2013/08/top-five-all-time-biggest-whistleblowers/

Fifth Circuit ruling re: Dodd-Frank Whistleblowers sets up Supreme Court appeal

In Asadi v. GE Energy (USA), L.L.C., No. 12-20522 (5th Cir. July. 17, 2013), the Fifth Circuit ruled that a whistleblower under Dodd Frank must report the complaint to the SEC to obtain whistleblower protection under Dodd-Frank. The Fifth Circuit summarized the statutory background and its ruling as follows: “Congress enacted Dodd-Frank in the wake …

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Permanent link to this article: http://betweenthenumbers.net/2013/07/fifth-circuit-ruling-re-dodd-frank-whistleblowers-sets-up-supreme-court-appeal/

Fifth Circuit Takes Different Stance on Dodd-Frank Whistleblower Status

The U.S. Court of Appeals for the Fifth Circuit’s decision in Asadi v. G.E. Energy provides a new take on whistleblower protections under the Dodd-Frank Wall Street Reform and Consumer Protection Act.  The Court found that, by definition, a whistleblower must have reported the claimed violation(s) to the U.S. Securities and Exchange Commission (“SEC”) in …

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Permanent link to this article: http://betweenthenumbers.net/2013/07/fifth-circuit-takes-different-stance-on-dodd-frank-whistleblower-status/

Use of Internal Personnel for Whistleblower Reporting Costs Employer in Tenth Circuit Case

In Lockheed Martin Corp. v. Brown, No. 11-9524 (10th Cir. Jun. 4, 2013), the Tenth Circuit supported a broad interpretation of the claims that are protected under the anti-retaliation provisions of the Sarbanes-Oxley Act. The Tenth Circuit broadly described the case as follows: “Lockheed Martin Corp. (“Lockheed”) seeks to set aside a decision of the …

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Whistleblower protection does not require fraud on shareholders

A recent decision has clarified the reach of the protections offered to whistleblowers under Section 806 of the Sarbanes-Oxley Act of 2002 (“SOX”).  In the matter of Lockheed Martin Corporation v. Administrative Review Board, United States Department of Labor, it has been determined that SOX whistleblower protection extends beyond employee reporting of frauds on shareholders.  …

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SEC Whistleblowers Rewarded

The Securities and Exchange Commission(“SEC”)  announced the agency has approved its second Dodd-Frank whistleblower award since the program’s 2011 inception, this time to three individuals who were each deemed to have provided information related to a $7.5 million enforcement action that was (i) voluntary, (ii) original, and (iii) led to the successful result. The SEC’s “fact …

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Permanent link to this article: http://betweenthenumbers.net/2013/06/sec-whistleblowers-rewarded/

Third Circuit supports whistleblower claim based on a more lenient standard

A Tyco Electronics accountant named Jeffrey Wiest consistently reported (and denied payment for) what he thought were inappropriate employee entertainment/party expenses because they did not meet IRS guidelines and his employer’s internal guidelines. The accountant claims that he was terminated in retaliation to his persistence in following proper accounting procedures. A district court threw out …

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Permanent link to this article: http://betweenthenumbers.net/2013/03/third-circuit-supports-whistleblower-claim-based-on-a-more-lenient-standard/

IRS cutting Whisteblower Awards

The far reaching implications of sequestration are affecting IRS whistleblower awards.  The IRS website contains the following announcement: “Pursuant to the requirements of the Balanced Budget and Emergency Deficit Control Act of 1985, as amended, certain automatic reductions will take place as of March 1, 2013. These required reductions include a reduction to awards paid …

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