Sarbanes Oxley Whistleblowing

Austin Lawyers Protecting the Rights of Employees

The Sarbanes-Oxley Act is a federal law enacted after the corporate Enron scandal. It establishes standards for the conduct of public companies, including their management, boards, and public accounting firms, and it protects some whistleblowers from retaliation. If you are an employee of a public company and believe that you experienced retaliation because you reported actions that you believed violated the federal laws related to fraud against shareholders, you may be able to bring a Sarbanes Oxley whistleblowing lawsuit. It is critical to retain an Austin whistleblower attorney in this situation. At Wiley Walsh, P.C., our knowledgeable litigators may be able to help you.

Sarbanes Oxley Whistleblowing

Under the Sarbanes-Oxley Act, a public company is not allowed to terminate, demote, threaten, suspend, harass, or otherwise take an adverse employment action against an employee because they gave information or helped in an investigation related to certain types of fraud. The employer is also not allowed to retaliate against an employee who files or helps with any proceeding related to a violation of federal anti-fraud laws.

If you believe that you were terminated or subjected to discrimination in violation of Sarbanes-Oxley, you can file a complaint with the U.S. Secretary of Labor. If the Secretary does not issue a final decision within 180 days of your filing, you can bring a lawsuit in district court. Your employer will most likely have the advice of legal counsel, and you should retain an attorney as early as you can during this process to ensure that you obtain the greatest possible legal protection.

You are protected under Sarbanes Oxley if you are an employee, officer, or agent of a publicly traded company. A publicly traded company is one that issues securities registered under the Securities Exchange Act of 1934 section 12 or is required to file reports under section 15(d).

You are also protected if you are employed by an affiliate or subsidiary of a publicly traded company whose financial information is part of the consolidated financial statements of the publicly traded company, a contractor or subcontractor of a public company (with some limitations), or a statistical rating organization that is nationally recognized. Contractor employees are protected under the anti-retaliation provision only insofar as their whistleblowing relates to the contractor performing or satisfying its role as a contractor for the public company. It does not protect contractor employees who experience unrelated retaliation.

In order to succeed on your claim, you will need to prove that it is more likely than not that you engaged in a protected activity, your employer knew of this activity, you experienced an adverse employment action, and the protected activity contributed to your experiencing the adverse employment action. After you make this showing, the burden shifts to the employer to show by clear and convincing evidence that it would have taken the same adverse employment action even if you had not engaged in a protected activity.

As a whistleblower, you are protected if you give information or help with an investigation about any actions of your employer that violate the following:

  • Federal criminal statutes against securities fraud, wire fraud, mail fraud, or bank fraud;
  • Rules and regulations of the SEC; or
  • Provisions of federal law related to defrauding shareholders.

You are protected even if you only raise a concern with your supervisor about fraud or a misrepresentation in an SEC filing. Under Sarbanes-Oxley, you can sue not only your employer but also an individual who has the functional ability to retaliate against you for whistleblowing and was aware of your protected activity.

You do not need to show that you disclosed an actual violation of securities laws. Instead, the standard is whether you reasonably believed that your employer was violating an SEC rule or defrauding shareholders. Even a mistaken belief that was reasonable is protected. You must have both a subjective belief and an objectively reasonable belief that the employer’s behavior was a violation of the relevant law. You also do not need to show that actual shareholder fraud occurred to be protected. You will be protected if you believe that a violation is likely to happen, as long as your belief is grounded in facts that are known to you.

Consult a Dedicated Austin Attorney When Reporting a Sarbanes Oxley Violation

If you face retaliation due to Sarbanes-Oxley whistleblowing in Texas, you should consult a wrongful termination attorney. You may be able to recover monetary damages or other relief, but you only have a narrow window of time—180 days after the date of the violation or the date on which you became aware of the violation. The Austin lawyers at Wiley Walsh, P.C. represent people in cities such as Austin, Georgetown, Round Rock, Cedar Park, Pflugerville, Leander, Del Valle, Kyle, San Marcos, San Antonio, New Braunfels, and Fredericksburg. Call us at (512) 271-5527 or use our online form to set up an appointment.

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