Whistleblower Protection Under Sarbanes-Oxley

• Author: Laura M. Franze
• Pages: 511-534

33-1

Chapter 33

WHISTLEBLOWERPROTECTIONUNDER

SARBANES-OXLEY

By Laura M. Franze

33:1. INTRODUCTION AND OVERVIEW

33:2. COVERED EMPLOYERS—WHO HAS OBLIGATIONS UNDER THE ACT?

A. Covered Employers

B. Subsidiaries of Covered Employers

C. Non-Public Companies

D. Individuals Subject to Liability

E. Obligations of In-House Attorneys

F. Extraterritorial Application

33:3. COVERED EMPLOYEES

33:4. COVERED DISCLOSURES AND PROTECTED ACTIVITIES

A. Civil Provisions

1. Reports

2. Or Assists in an Investigation Thereof or Any Proceeding Relating To

3. Concerning Fraud Against Shareholders

4. With Reasonable Belief that Reported Acts Were Illegal

5. Other Protected Activity

6. Reports Not Covered Under the Act

B. Criminal Provisions

1. Make Truthful Reports to a Law Enforcement Officer

33:5. CONDUCT PROHIBITED

A. Burden of Proof

B. Causation

TEXAS EMPLOYMENT LAW33-2

33:6. REMEDIES FOR THE WHISTLEBLOWER

A. Reinstatement

B. Damages

C. Additional Penalties

1. Civil

2. Criminal

3. RICO

33:7. ADMINISTRATIVE COMPLAINT PROCEDURE

33:8. EMPLOYER INVESTIGATIONS

A. Procedures for Investigation of Whistleblower Complaints

B. Independence of Investigation

C. Confidentiality and Privilege

D. Documentation of Investigation

E. Handling Documents and Electronic Data

1. Retrieval

2. Retention

33:9. LITIGATION ISSUES

A. Early Claims and Decisions

B. Mood of the Times

C. No Right to Jury Trial

D. Special Settlement Procedures

E. Burden of Proof

33:10. ARBITRATION AGREEMENTS

33:11. CORPORATE POLICIES

A. Audit Committee Complaint Procedures

B. Code of Ethics Requirement for Senior Financial Officers

C. Document Retention Policy Mandates

1. Generally

2. Criminal Provisions Related to Document Retention

D. Suggestions for Modifying Company Policy and Practice