Image of Whistleblower Protection Law Firm Submits Amici Curiae Brief About Sarbanes-Oxley Whistleblower Causation Standard

Whistleblower Protection Law Firm Submits Amici Curiae Brief About Sarbanes-Oxley Whistleblower Causation Standard

Today the Zuckerman Law whistleblower protection law firm submitted an amici curiae brief to the Department of Labor Administrative Review Board urging the Board to affirm the majority opinion in Fordham v. Fannie Mae, ARB No. 12-061, ALJ No. 2010-SOX-051 (Oct. 9, 2014), which articulates a standard for “contributing factor” causation that is consistent with the plain meaning and intent of the whistleblower protection provisions of the Sarbanes-Oxley Act. Zuckerman Law filed the amici curiae brief on behalf of the National Whistleblowers Center, National Employment Lawyers Association, Teamsters for a Democratic Union, and Truckers Justice Center.

The Fordham majority held that under the AIR 21 burden-shifting framework incorporated into Section 806 of the Sarbanes-Oxley Act, “the determination of whether a complainant has met his or her initial burden of proving that protected activity was a contributing factor in the adverse personnel action at issue is required to be made based on the evidence submitted by the complainant, in disregard of any evidence submitted by the respondent in support of its affirmative defense that it would have taken the same personnel’ action for legitimate, non-retaliatory reasons only. Should the complainant meet his or her evidentiary burden of proving “contributing factor” causation, the respondent’s affirmative defense evidence is then to be taken into consideration, subject to the higher “clear and convincing” evidence burden of proof standard, in determining whether or not the respondent is liable for violation of SOX’s whistleblower protection provisions.” Fordham, slip op. at 3.

Some defense firms contend that Fordham radically alters the contributing factor causation standard.  The amici curiae brief, however, contends that Fordham is consistent with the plain meaning and legislative history of the whistleblower protection statutes that employ contributing factor causation. Fordham merely clarifies that evidence supporting an employer’s affirmative defense evidence must be assessed under the clear and convincing evidence standard rather than under the lower preponderance of the evidence standard.

The amici curiae brief discusses the history of the “contributing factor” causation standard, which was first introduced in the Whistleblower Protection Act (WPA). Before Congress enacted the WPA, a whistleblower had to establish that her protected disclosure “constituted a ‘significant’ or ‘motivating’ factor in the agency’s decision to take the personnel action.” Marano v. Dep’t of Justice, 2 F.3d 1137, 1140 (Fed. Cir. 1993) (citing Clark v. Department of Army, 997 F.2d 1466, 1469–70 (Fed.Cir.1993)). When Congress enacted the WPA in 1989, it “substantially reduc[ed]” a whistleblower’s burden to establish her case, and sent “a strong, clear signal to whistleblowers that Congress intends that they be protected from any retaliation related to their whistleblowing.” Id. at 1140 (citing 135 Cong.Rec. 5033 (1989) (Explanatory Statement on S. 20)). The WPA replaced the previous onerous requirements with a more favorable “contributing factor” burden. Id. Congress, in an oft-quoted explanatory statement, characterized a “contributing factor” as “any factor which, alone or in connection with other factors, tends to affect in any way the outcome of the decision. This test is specifically intended to overrule existing case law, which requires a whistleblower to prove that his protected conduct was a ‘significant,’ ‘motivating,’ ‘substantial,’ or ‘predominant’ factor in a personnel action in order to overturn that action.” 135 Cong. Rec. 5033 (1989) (Explanatory Statement on S. 20) (emphasis added).

In addition, the amici curiae brief discusses how the WPA/SOX/AIR 21/ERA burden-shifting framework is distinct from the Title VII burden-shifting framework. As the Federal Circuit noted in a seminal decision discussing the WPA, Congress specifically intended to hold agencies to a higher burden because whistleblowers are at a severe disadvantage in proving whistleblower retaliation:

The laws protecting whistleblowers from retaliatory personnel actions provide important benefits to the public, yet whistleblowers are at a severe evidentiary disadvantage to succeed in their defenses. Thus, the tribunals hearing those defenses must remain vigilant to ensure that an agency taking adverse employment action against a whistleblower carries its statutory burden to prove—by clear and convincing evidence—that the same adverse action would have been taken absent the whistleblowing.

Whitmore v. Dep’t of Labor, 680 F.3d 1353 (Fed. Cir. 2012). Permitting employers to prevail by proving the reason for an adverse action under the preponderance of the evidence standard would contravene the plain meaning of SOX and AIR 21, and would undermine Congressional intent.

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Jason Zuckerman, Principal of Zuckerman Law, litigates whistleblower retaliation, qui tam, wrongful discharge, and other employment-related claims. He is rated 10 out of 10 by Avvo, was recognized by Washingtonian magazine as a “Top Whistleblower Lawyer” in 2015 and selected by his peers to be included in The Best Lawyers in America® and in SuperLawyers.