Supreme Court acknowledges whistleblower friendly burden of proof

Congress enacted the whistleblower protections of the Sarbanes-Oxley Act of 2002 to prohibit publicly traded companies from retaliating against employees who report what they reasonably believe to be instances of criminal fraud or securities law violations. Employers may not “discharge, demote, suspend, threaten, harass, or in any other manner discriminate against an employee in the terms and conditions of employment because of” protected whistleblowing activity. The law also contains an employee friendly burden of proof, as the U.S. Supreme Court explains.

Investment bankers try to strongarm independent analyst

Trevor Murray was employed as a research strategist at securities firm UBS, within the firm’s commercial mortgage-backed securities (CMBS) business. In that role, he was responsible for reporting on CMBS markets to current and future UBS customers. Securities and Exchange Commission (SEC) regulations required him to certify that his reports were produced independently and accurately reflected his own views.

Murray alleged that, despite this requirement of independence, two leaders of the CMBS trading desk improperly pressured him to skew his reports to be more supportive of their business strategies, even instructing him to “clear [his] research articles with the desk” before publishing them. He reported that conduct to his direct supervisor, Michael Schumacher, in December 2011 and again in January 2012, asserting that it was “unethical” and “illegal.”