The U.S. Supreme Court yesterday endorsed a narrow definition of the term “whistleblower” in the context of the Dodd-Frank Act. Specifically, the Court ruled in Digital Realty Trust Inc. v. Paul Somers that whistleblowers qualify for the special relief provided under Dodd-Frank only if they take their allegations to the U.S. Securities and Exchange Commission (SEC). They may also take their allegations to the employer or supervisor, but Dodd-Frank relief only goes to those who inform the SEC.
The Dodd-Frank Act, passed in 2010, expanded whistleblower incentives and protections created under the 2002 Sarbanes-Oxley Act. The justices analyzed the specific wording of Dodd-Frank, which defined whistleblowers as employees who provide “information relating to a violation of the securities laws to the commission.”
The Sarbanes-Oxley Act continues to protect a broader category of people – including people who complain only to their employers. This ruling only limits claimants under Dodd-Frank.
