13 June 2018
On June 26th, the United States Supreme Court granted certiorari to hearing an appeal requiring it to determine when a corporate insider becomes a whistleblower protected by Dodd-Frank Act’s anti-retaliation provisions. The Second and Fifth Circuits have split over whether an internal whistleblower who has not reported concerns to the SEC is protected by the Dodd-Frank Act.
Recently, the Ninth Circuit joined the Second Circuit in finding that the retaliation provision is ambiguous and that courts must defer to SEC guidance. This is in contrast to the Fifth Circuit holding which states that, in order to be protected by the Dodd-Frank Act, a whistleblower must first report wrongdoing to the SEC.
For more information on Digital Realty Trust v. Somers, see http://cdn.ca9.uscourts.gov/datastore/opinions/2017/03/08/15-17352.pdf