In the following guest post, Gregory A. Markel, Christopher F. Robertson, and David J. Winkler of the Seyfarth Shaw law firm take a look at the Second Circuit's August 5, 2022 decision in Murray v. UBS Securities LLC. As the authors discuss, the Second Circuit's ruling creates a split within the federal judicial circuits on the question of whether or not a SOX whistleblower retaliation claimant must prove retaliatory intent in order to prevail. I would like to thank the authors for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog's readers. Please contact me directly if you would like to submit a guest post. Here is the authors' article.
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In a decision with potentially wide-ranging implications for federal whistleblower protection law, the Second Circuit has held that plaintiffs who allege they were punished by their employers for whistleblowing activity, and who then file suit under the Sarbanes-Oxley Act, must now put forward specific proof of the employer's "retaliatory intent" to prevail. In addition to raising the bar for such lawsuits, the court's August 5, 2022 decision in Murray v. UBS Securities LLC et al. also creates a clear circuit split, pitting the Second Circuit against two other federal circuits that have specifically held retaliatory intent not to be an element of Sarbanes-Oxley whistleblower claims.
Background
Under Sarbanes-Oxley's antiretaliation provision, a publicly-traded company may not "discharge, demote, suspend, threaten, harass, or in any other manner discriminate against an employee in the terms and conditions of employment because of" the employee's participation in either an investigation or a formal proceeding regarding alleged violations by the company of certain securities and antifraud laws. 18 U.S.C. ' 1514A(a). An employee who feels he or she has faced such retaliation may, after first seeking redress from the Department of Labor, sue the employer in federal court. Id. ' 1514(b)-(c).
Trevor Murray was one such employee. Hired in 2011 as a strategist in UBS's commercial mortgage-backed securities ("CMBS") business, Murray's job was to research and report on CMBS products for current and potential clients. He was also required by federal regulation to certify that the views expressed in the reports accurately reflected his own, and were not tied to his compensation. Yet Murray was...
