The proliferation of whistleblower retaliation and reward laws has created a complex maze of claims and remedies. This panel of plaintiff attorneys will examine issues that frequently arise in whistleblower cases including: Identifying whistleblower rewards claims and formulating a strategy to maximize damages Litigating non-intervened FCA cases The scope of protected conduct under the False Claims Act, the Sarbanes-Oxley Act and the Dodd-Frank Act Preserving retaliation claims while pursuing reward claims Trends in jury verdicts in federal and state whistleblower litigation and practice tips for litigating and trying whistleblower retaliation claims Key procedural distinctions between SOX, FCA and Dodd-Frank whistleblower protection

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AdvancedForumonWhistleblowerLitigation
Jordan A. Thomas
Partner
Labaton Sucharow LLP
Plaintiff Views — Preparing for the Fallout from Private Litigation: Insights into the Litigation
Landscape and Prospects for Privately Represented Whistleblowers
Jason Zuckerman
Principal
Zuckerman Law
July 28, 2015
Tweeting about this conference?

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Topics
Retaliation Cases
• Assessing potential retaliation claims
• Key distinctions between SOX and Dodd-
Frank whistleblower protection
• Whistleblower protection for employees
of government contractors
• Trends in jury verdicts
• Claim and forum selection

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Topics
Reward Cases
• Leading reward programs
• Assessing potential reward claims
Advice for Plaintiff’s Counsel
Advice for Responsible Organizations

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RETALIATION CASES

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Potential Impact of
Retaliation Claim on Reward Claim
• Avoid breaching the seal
• Prepare to address discovery about
communications with regulators
• If employer offers to settle retaliation
claim, whistleblower risks potential
waiver of reward claim
• For current employees, difficult balance
between protecting confidentiality and
proving employer knowledge of
whistleblowing

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Assessing Potential
Retaliation Claims
• Assess all potential retaliation claims
• 22 plus federal whistleblower law enforced by
OSHA
• Employees of government contractors
• False Claims Act, 31 USC 3730(h)
• Sections 827 and 828 of 2013 NDAA, 10
U.S.C. § 2409 and 41 U.S.C. § 4712
• State whistleblower statutes
• State common law wrongful discharge
• Punitive damages

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Key Factors in Assessing
Potential Claims
• Damages
• Scope of protected whistleblowing
• Causation standard
• “Contributing factor” versus “but for” causation
• Administrative Exhaustion
• Preliminary Reinstatement
• Statute of Limitations
• Claim splitting and collateral estoppel

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Assessing Potential
Retaliation Claims
• DOL enforces more than 22 whistleblower laws (nuclear
safety, airline safety, transportation safety, SOX, consumer
product safety, etc.)
• Most of the DOL whistleblower laws follow employ this
procedural scheme:
• File at OSHA (SOL varies from 30 to 180 days)
• OSHA investigates and under some of the laws, can order preliminary
reinstatement
• Discovery and hearing before ALJ
• Appeal to ARB
• Appeal to Circuit Court of Appeals
• Some of the laws have a “kick out” provision

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OSHA ComplaintDeterminations
FY 2005-FY2014
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014
Kick-Out
Withdrawn
Dismissed
Se led
Other

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SOX Protected Conduct
• Sylvester v. Parexel Int’l, WL 2165854 (ARB May 25,
2011) adopted by 2d, 3d, 5th, and 6th Circuits
• Disclosure of potential violation protected
• A complaint need not allege shareholder fraud to receive
SOX’s protection
• Reasonable belief standard does not require complainants
to have told management or the authorities why their
beliefs are reasonable
• SOX complainants no longer need to show that their
disclosures “definitively and specifically” relate to the
relevant laws
• SOX complainants need not establish criminal fraud

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Section 929A Dodd-Frank
Protected Conduct
• Providing information to the SEC in
accordance with § 922;
• Initiating, testifying in, or assisting in any
investigation or judicial or administrative
action of the SEC based upon or related to
such information; or
• Disclosing information required or
protected by SOX, the 1934 Act, and any
other law, rule, or regulation subject to the
jurisdiction of the SEC.

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Distinctions Between SOX and
Dodd-Frank

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FCA Protected Conduct
• Broader scope of protected conduct post-2009
FCA amendments
• Protects actions in furtherance of a qui tam
action and “other efforts to stop 1 or more
violations of [the FCA]”
• Young v. CHS Middle E., LLC, 2015 WL 3396790
(4th Cir. May 27, 2015)
• protect[s] employees while they are collecting information about a possible fraud,
before they have put all the pieces of the puzzle together
• Need not prove actual FCA violation
• Higher burden for “duty speech” claims

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NDAA Protected Conduct
• Covers employees of nearly all
government contractors
• Excludes contractors of Intelligence agencies
• Broad scope of protected conduct
• Violation of law, rule, or regulation relating to federal contracts,
including competition for or negotiation of a contract;
• Gross mismanagement, gross waste of federal funds, abuse of
authority; or
• substantial and specific danger to public health or safety

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DistinctionsBetween FCAandNDAA
FCA Anti-Retaliation Provision Sections 827 and 828 of NDAA
Coverage Employee, contractor, or agent Employee of a contractor,
subcontractor, or grantee
Protected
Conduct
Lawful acts done by the
employee, contractor, agent or
associated others 1) in
furtherance of an action under
the FCA or 2) other efforts to
stop 1 or more violations
-Violation of law, rule, or
regulation related to a federal
contract
-Gross mismanagement of a
federal contract or grant
-Gross waste of federal funds
-Abuse of authority relating to a
federal contract or grant
-Substantial and specific danger to
public health or safety
Administrative
Exhaustion
File directly in federal court Must file initially at OSHA; can
remove to federal court after 210
days
Causation
Standard
“But for” causation Contributing Factor
Jury Trial Y Y
Damages Double back pay, reinstatement,
special damages (emotional
distress damages and harm to
reputation), attorney fees
Back pay, reinstatement, special
damages, attorney fees
Statute of
Limitations
3 years 3 years

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Forum Selection
• DOL
• Obtain early discovery from investigation
• Preliminary reinstatement
• Favorable ARB rulings
• Less formal pleading requirement and evidentiary rules
• Federal Court
• Higher risk of summary judgment
• Jury trial and uncapped compensatory damages
• Supplemental claims

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Common Law Wrongful Discharge
• Federal statutory remedy typically precludes a
wrongful discharge claim
• Many states do not apply a reasonable belief
standard and instead require a showing of an
actual violation
• Causation standard is far more onerous than
contributing factor (in some states, it is sole
cause)
• No fee-shifting

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Recent Verdicts
• $6M Zulfer v. Playboy Enterprises Inc.,
JVR No. 1405010041, 2014 WL
1891246 (C.D.Cal. 2014)
• $2.2M in damages and $2.4M in fees
Van Asdale v. Int'l Game Tech., 549 F.
App'x 611, 614 (9th Cir. 2013)

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Proving Retaliation
• Statements of animus
• Deviation from company policy or
practice
• Failure to investigate or sham
investigation
• Placing whistleblower under microscope
• Shifting or contradictory explanations
• Post hoc justifications

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REWARD CASES

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Leading Reward Programs

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Leading Reward Programs
• Federal and state FCAs
• SEC and CFTC
• IRS
• FIRREA

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Assessing Potential
Reward Claims

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Advice for Plaintiff’s Counsel

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Advice for Responsible
Organizations