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Univ. of Toledo College of Law

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Sunday, July 5, 2009

Vega on SOX Whistleblowers

The Sarbanes-Oxley Act & the Culture of Bribery: Expanding the Scope of Private Whistleblower Suits to Overseas Employees, by Matt A Vega, Faulkner University, Thomas Goode Jones School of Law, was recently posted on SSRN.  Here is the abstract:

This Article makes a case for using a private right of action to protect overseas employees from retaliation by their employers for reporting or opposing the bribery of foreign officials. After surveying public enforcement efforts, voluntary corporate initiatives, and existing private causes of action that may be predicated on FCPA violations, the Article finds that they all have their shortcomings and recommends several legal and legislative solutions. First, a private cause of action for retaliation should be implied under the FCPA. Second, section 806 of the Sarbanes- Oxley Act of 2002 should be read to protect whistleblowers who disclose FCPA violations by publicly held U.S. companies. Third, the territorial scope of section 806 should be expanded to cover employees working overseas. The Article takes issue with the First Circuit’s decision in Carnero v. Boston Scientific Corp., which declined to extend section 806 whistleblower protection to a foreign employee of a foreign subsidiary of a publicly held U.S. company. The Article then explores two alternative approaches to extraterritoriality suggested in the Southern District of New York court’s recent decision in O’Mahony v. Accenture Ltd. to support prescriptive jurisdiction in such cases: the 'conduct' and 'effects' tests. Alternatively, it argues section 806 and the administrative complaint procedures from AIR21 it incorporates by reference should be amended to provide specific procedures for employees overseas to bring whistleblower complaints. Finally, the Article endorses the Foreign Business Bribery Prohibition Act of 2008, H.R. 6188, which is expected to be reintroduced by Congressman Ed Perlmutter in the 111th Congress, to authorize private suits for treble damages against foreign concerns whose bribery costs American businesses and their employees.

http://lawprofessors.typepad.com/securities/2009/07/vega-on-sox-whistleblowers.html

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Comments

Whistleblowers deserve proper protection.

Posted by: whistleblower lawyers | Jul 17, 2009 6:32:21 AM

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