Difference between revisions of "Whistleblower Protection Laws"

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==='''Front Pay in Lieu of Reinstatement in Whistleblower Retaliation Cases'''===
==='''Front Pay in Lieu of Reinstatement in Whistleblower Retaliation Cases'''===
Reinstatement is the “presumptive and preferred remedy,” but where pronounced animosity between the parties leads both of them to advocate against reinstatement, front pay may be an appropriate substitute.  Front pay is designed to compensate the plaintiff for the time it would take to secure comparable employment. See, e.g., Hagman v. Washington Mutual Bank, Inc., ALJ Case No. 2005-SOX-00073, at 26–30 (ARB Dec. 19, 2006), appeal dismissed, ARB Case No. 07-039 (ARB May 23, 2007) (awarding $640,000 in front pay to a banker whose supervisor became verbally and physically threatening when the banker disclosed concerns about the short funding of construction loans).
Reinstatement is the “presumptive and preferred remedy,” but where pronounced animosity between the parties leads both of them to advocate against reinstatement, front pay may be an appropriate substitute.  Front pay is designed to compensate the plaintiff for the time it would take to secure comparable employment. ''See, e.g., Hagman v. Washington Mutual Bank, Inc.,'' ALJ Case No. 2005-SOX-00073, at 26–30 (ARB Dec. 19, 2006), ''appeal dismissed,'' ARB Case No. 07-039 (ARB May 23, 2007) (awarding $640,000 in front pay to a banker whose supervisor became verbally and physically threatening when the banker disclosed concerns about the short funding of construction loans).


Where a whistleblower demonstrates that he planned to continue working for the employer until he or she reached normal retirement age and demonstrates sufficient efforts to mitigate damages (find comparable employment), the whistleblower can been entitled to expected earnings to the date of retirement.  For example in the Perez v. Progenics Pharmaceuticals SOX whistleblower case, the court awarded approximately $2.7 in front pay.  That case is discussed in an article in Corporate Counsel titled How to Help a Whistleblower.
Where a whistleblower demonstrates that he planned to continue working for the employer until he or she reached normal retirement age and demonstrates sufficient efforts to mitigate damages (find comparable employment), the whistleblower can been entitled to expected earnings to the date of retirement.  For example in the [https://www.zuckermanlaw.com/sarbanes-oxley-whistleblower-obtains-2-7m-front-pay/ Perez v. Progenics Pharmaceuticals] SOX whistleblower case, the court awarded approximately $2.7 in front pay.  That case is discussed in an article in Corporate Counsel titled [https://www.zuckermanlaw.com/how-to-help-a-whistleblower/ How to Help a Whistleblower].


Front pay is an appropriate remedy in lieu of reinstatement in SOX whistleblower cases. See Jones v. SouthPeak Interactive Corp., 986 F. Supp. 2d 680 (E.D. Va. 2013), aff’d, 777 F.3d 658 (4th Cir. 2015). Andrea Jones worked at SouthPeak Interactive Corp. (“SouthPeak”) as its chief financial officer, and SouthPeak terminated her employment two days after she disclosed accounting irregularities to the SEC. Following a four-day trial, a jury found for Jones and awarded nearly $700,000 in damages. Jones then filed a motion seeking front pay in lieu of reinstatement and in addition to compensatory damages. Judge Payne awarded front pay, and noted the following:
Front pay is an appropriate remedy in lieu of reinstatement in [https://www.zuckermanlaw.com/legal-services/sarbanes-oxley-whistleblower/ SOX whistleblower cases]. ''See Jones v. SouthPeak Interactive Corp.,'' 986 F. Supp. 2d 680 (E.D. Va. 2013), ''aff’d,'' 777 F.3d 658 (4th Cir. 2015). Andrea Jones worked at SouthPeak Interactive Corp. (“SouthPeak”) as its chief financial officer, and SouthPeak terminated her employment two days after she disclosed accounting irregularities to the SEC. Following a four-day trial, a jury found for Jones and awarded nearly $700,000 in damages. Jones then filed a motion seeking front pay in lieu of reinstatement and in addition to compensatory damages. Judge Payne awarded front pay, and noted the following:


Front pay also has been more precisely defined as “a lump sum … representing the discounted present value of the difference between the earnings [an employee] would have received in his old employment and the earnings he can be expected to receive in his present and future, and by hypothesis, inferior, employment.” McKnight v. Gen. Motors Corp., 908 F.2d 104, 116 (7th Cir.1990), cert. denied, 499 U.S. 919, 111 S.Ct. 1306, 113 L.Ed.2d 241 (1991), partially superseded by Civil Rights Act of 1991, Pub.L. 102-166, 105 Stat. 1071 (codified at 42 U.S.C. 1981 et seq.). If a plaintiff has been diverted onto a less profitable career path through the unlawful actions of his former employer, an award of front pay to compensate the plaintiff until such time as he can regain his former career track is not a windfall.
Front pay also has been more precisely defined as “a lump sum … representing the discounted present value of the difference between the earnings [an employee] would have received in his old employment and the earnings he can be expected to receive in his present and future, and by hypothesis, inferior, employment.” [https://scholar.google.com/scholar_case?case=13517904806616780298&q=kalkunte+sox+damages&hl=en&as_sdt=20000006 McKnight v. Gen. Motors Corp., 908 F.2d 104, 116 (7th Cir.1990)], ''cert. denied,'' [https://scholar.google.com/scholar_case?about=17434842911766892558&q=kalkunte+sox+damages&hl=en&as_sdt=20000006 499 U.S. 919, 111 S.Ct. 1306, 113 L.Ed.2d 241 (1991)], ''partially superseded by'' Civil Rights Act of 1991, Pub.L. 102-166, 105 Stat. 1071 (codified at 42 U.S.C. 1981 ''et seq.''). If a plaintiff has been diverted onto a less profitable career path through the unlawful actions of his former employer, an award of front pay to compensate the plaintiff until such time as he can regain his former career track is not a windfall.


SouthPeak appealed Judge Payne’s decision. The DOL filed an amicus curiae brief arguing that front pay is an appropriate remedy under SOX, and the Fourth Circuit affirmed. See 777 F.3d at 663.
SouthPeak appealed Judge Payne’s decision. The DOL filed an ''amicus curiae'' brief arguing that front pay is an appropriate remedy under SOX, and the Fourth Circuit affirmed. ''See 777 F.3d at 663.''


In calculating front pay, courts should apply the following guiding principles:
In calculating front pay, courts should apply the following guiding principles:
 
*“It is well settled that `the risk of lack of certainty with respect to projections of lost income must be borne by the wrongdoer, not the victim.” Bartek v. Urban Redevelop ent Authority, 882 F.2d 739, 746 (3d Cir. 1989).
“It is well settled that `the risk of lack of certainty with respect to projections of lost income must be borne by the wrongdoer, not the victim.” Bartek v. Urban Redevelop ent Authority, 882 F.2d 739, 746 (3d Cir. 1989).
*The Court should “assume, absent evidence to the contrary, that the illegally discharged employee would have continued working for the employer until he or she reached normal retirement age.”  ''See Perez v. Progenics Pharmaceuticals, Inc.,'' 204 F. Supp. 3d 528 (S.D.N.Y. 2016).
The Court should “assume, absent evidence to the contrary, that the illegally discharged employee would have continued working for the employer until he or she reached normal retirement age.”  See Perez v. Progenics Pharmaceuticals, Inc., 204 F. Supp. 3d 528 (S.D.N.Y. 2016).


==='''Compensatory Damages in Whistleblower Retaliation Cases'''===
==='''Compensatory Damages in Whistleblower Retaliation Cases'''===
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