It’s indisputably true that retaliating against employees who come forward with allegations about illegal company activity is a terrible idea. But employers need to be particularly careful about whistleblowers who fall under Sarbanes-Oxley and Dodd-Frank, both of which provide plenty of protection to those who speak up, including financial compensation for retaliation. And for plaintiffs, the opportunities to cash in on the emotional harm caused by retaliation are expanding.
A recent ruling from the U.S. Court of Appeals for the Fourth Circuit, Jones v. SouthPeak Interactive of Delaware, confirmed that under SOX, hurting a whistleblower’s feelings can hurt the company’s pocketbook. In the case, Andrea Gail Jones, the former chief financial officer at SouthPeak, a video game publishing company, spoke up after her company omitted important information in its May 2009 quarterly earnings report to the U.S. Securities and Exchange Commission. In August, after Jones continued speaking out about the issue, the company’s board decided to terminate her employment. Jones then filed a complaint with the U.S. Occupational Safety and Health Administration, and then, nearly three years after the date of her firing, filed a SOX suit in federal court.
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