Corporate Whistleblower Attorney Quoted in NLJ About SOX Extraterritoriality

National Law Journal Quotes SOX Whistleblower Lawyer About SOX Extraterritoriality

An article in the National Law Journal titled Labor Panel Defines Global Scope of Whistleblower Law, Reviving Contractor’s Claims quotes whistleblower lawyer Jason Zuckerman about the potential impact of the Department of Labor Administrative Review Board’s decision in Blanchard v. Exelis Systems Corp., ARB No. 15-031, ALJ No. 2014-SOX-20 (ARB Aug. 29, 2017) concerning extraterritorial application of SOX. The article states:

Jason Zuckerman, a whistleblower lawyer in Washington, said Blanchard’s case presented no “genuine issue” of Sarbanes-Oxley’s application to retaliation against employees in foreign countries because the whistleblower was a U.S. citizen working for a U.S. corporation working in a U.S. territory. The panel’s decision, he said, provides a framework to assess the extraterritorial application of federal whistleblower laws.

“For too long there was an incorrect prevailing assumption that a violation of the [Sarbanes-Oxley] whistleblower provision outside the U.S. is not actionable,” Zuckerman wrote in an email to the NLJ. “This opinion, however, reveals that [Sarbanes-Oxley] is as much an anti-fraud law as it is a worker protection law and therefore can apply to conduct abroad.”

The ARB’s reversal of the ALJ’s decision is not surprising. As Judge Igasaki notes in a concurring opinion, “this case is a domestic one, involving a U.S. corporation with securities listed on a U.S. exchange, contracting with the U.S. military on a U.S. base that is U.S. territory for purposes of the law.” But Blanchard is significant because it provides a new framework to assess extraterritorial application of SOX.

Judge Brown’s thorough analysis of the enumerated fraud provisions in Section 806 of SOX and the history of SOX provide compelling evidence that Congress intended for SOX whistleblower protection to apply to employees working for publicly traded companies abroad. Click here to read more about the Blanchard decision holding that the whistleblower protection provision of SOX applies extraterritorially.