Emerging Markets Law

Supreme Court Hears SOX Whistleblower Case

Posted In Sarbanes-Oxley

The Sarbanes-Oxley Act dramatically changed the way public companies did business by substantially increasing the level of disclosure required to be made to the public and defining precise procedural requirements for who those disclosures must be made.

At the same time, the Sarbanes-Oxley Act (or "SOX") created incentives for corporate insiders to publicly-report (or "blow the whistle") on wrongdoing inside of their own companies.  To protect those whistle-blowers, SOX implement multiple protections for the individuals involved, creating a cause of action for a whistle-blower whose employment was terminated in retaliation for the whistle-blowing activity.

The Supreme Court yesterday heard oral argument in the case of Jackie Hosang Lawson and Jonathan M. Zang v. FMR LLC et al., on the question of whether SOX's whistle-blower protections covered contractors and sub-contractors to a public company. (Law 360 article).

The Supreme Court's decision will have a significant impact on public companies and the way in which they management their contractors and sub-contractors.

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