SCOTUS Issues Decision with Significant Implications for Future Whistleblower Cases

Goulston & Storrs PC

On February 8, 2024, the United States Supreme Court issued an opinion in Murray v. UBS Securities, LLC, 601 U.S. ___(2024), a case involving a former UBS employee’s claim that he was terminated for making an internal report of suspected fraud on shareholders. The plaintiff filed suit against UBS under the whistleblower protection provision of the Sarbanes-Oxley Act of 2002, 18 U.S.C. § 1514A(a) (“Whistleblower Protection for Employees of Publicly Traded Companies”), which makes it unlawful for any covered employer to “discharge, demote, suspend, threaten, harass, or in any other manner discriminate against an employee in the terms and conditions of employment” based on the employee’s participation in protected whistleblowing activities, such as reporting conduct that is reasonably believed to constitute fraud or violation of securities laws. The plaintiff prevailed at trial in the district court and UBS appealed to the Second Circuit. 

UBS’s appeal to the Second Circuit presented the question of whether, in cases brought under the whistleblower protection provision of the Sarbanes Oxley Act (18 U.S.C. § 1514A(a)), a plaintiff must prove the employer subjected the plaintiff to an adverse employment action with retaliatory intent. The Second Circuit vacated the judgment of the district court and held that a whistleblower-employee must prove, by a preponderance of the evidence, that the employer acted with the intent to discriminate against the employee because the employee engaged in protected whistleblowing activity. Murray appealed the Second Circuit’s decision to the Supreme Court. 

On appeal, the Supreme Court evaluated whether a plaintiff who asserts a claim of retaliation under 18 U.S.C. § 1514A must prove that the defendant-employer acted with “retaliatory intent.” In a unanimous decision, the Supreme Court held that the plaintiff must prove that their protected whistleblowing activity “‘was a contributing factor in the unfavorable personnel action alleged in the complaint,’…but…is not required to make some further showing that [the] employer acted with ‘retaliatory intent.’” Murray v. UBS Securities, LLC, 601 U.S. ___(2024). The Supreme Court’s opinion resolves a circuit split and has significant implications for future whistleblower retaliation cases. 

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