By Yin Wilczek
Sept. 5 — The U.S. Court of Appeals for the Eighth Circuit has declined to review a case involving whether would-be whistle-blowers must report perceived wrongdoing to the Securities and Exchange Commission to be protected under Dodd-Frank's anti-retaliation provisions.
The court's Sept. 4 order did not explain its rationale for denying a Nebraska-based securities clearing firm's request for permission to file an interlocutory appeal.
The question of whether informants are entitled to protection under the Dodd-Frank Wall Street Reform and Consumer Protection Act only if they first approach the SEC has divided several federal district courts.
In the case on appeal, the U.S. District Court for the District of Nebraska concluded that Julie Bussing, a former employee of Legent Clearing LLC, now known as COR Clearing LLC, qualified as a “whistle-blower” protected under Dodd-Frank, even though she provided information about a possible securities fraud to the Financial Industry Regulatory Authority, not the SEC.
The district court later agreed to certify its ruling for interlocutory appeal but denied the employer's request to stay the case pending resolution of the appeal.
Meanwhile, the U.S. Court of Appeals for the Fifth Circuit concluded in Asadi v. G.E. Energy (USA) LLC that Dodd-Frank's whistle-blower protections cover only those who initially approach the SEC.
With the Eighth Circuit refusing to take up COR Clearing's appeal, the Fifth Circuit remains the only appellate court to have tackled the issue.
The U.S. Court of Appeals for the Second Circuit had the opportunity to rule on the question in the case of Liu v. Siemens AG but punted.
The SEC, through an amicus brief in Liu, clarified its position that whistle-blowers are entitled to protection under its rules whether they report the wrongdoing to their employers or to the commission (29 CCW 68, 2/26/14).
In the Eighth Circuit, the U.S. Chamber of Commerce Sept. 4 urged the Eighth Circuit to hear the appeal, arguing that the district court's ruling significantly expanded the reach of Dodd-Frank's whistle-blower provisions.
To contact the reporter on this story: Yin Wilczek in Washington at email@example.com
To contact the editor responsible for this story: Phyllis Diamond at firstname.lastname@example.org
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)