November 23, 2020

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November 20, 2020

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House Financial Services Committee Passes Bill to Expand Dodd-Frank Whistleblower Protection to Internal Whistleblowers

On May 8, 2019, the House Committee on Financial Services passed H.R. 2515, the Whistleblower Protection Reform Act of 2019, which would amend Section 922 of Dodd-Frank to extend the statute’s anti-retaliation protections to employees who report alleged misconduct internally.

Digital Realty Trust v. Somers

H.R. 2515 was proposed in direct response to the U.S. Supreme Court’s holding last year in Digital Realty Trust, Inc. v. Somers, 138 S. Ct. 767 (2018).  As detailed in our blog, in Digital Realty, the Court unanimously held that Dodd-Frank’s anti-retaliation provision only applied to individuals who provide information regarding a violation of securities law to the SEC.  The Court declined to defer to the SEC’s prior Rule 21F-2, which had permitted an individual to gain anti-retaliation protection without providing information to the SEC.  As we reported, following the Digital Realty decision, the SEC voted in favor of amending Rule 21F-2 so that it comported with the Court’s holding.

H.R. 2515’s Expanded Protections

The language passed by the Financial Services Committee on May 8th extends Dodd-Frank’s anti-retaliation protections to any individual who provides information regarding any conduct that the individual “reasonably believes constitutes a violation of any law, rule, or regulation” subject to the SEC’s jurisdiction to:  “(a) a person with supervisory authority over the … [individual] at the … [individual’s] employer; and/or (b) any person working for the employer who has the authority to “investigate, discover, or terminate misconduct.”

H.R. 2515 was originally introduced by Representative Al Green, D-Texas, on May 3, 2019.  It now moves on to the full House of Representatives.

Implications for Employers

If enacted, H.R. 2515 would significantly expand the scope of protections under the Dodd-Frank Act, and could lead to an increase in claims.  We will monitor this legislation and keep our readers posted on developments.

© 2020 Proskauer Rose LLP. National Law Review, Volume IX, Number 150



About this Author

Steven J Pearlman, Labor Employment Law Firm, Proskauer Law firm

Steven Pearlman is a partner in the Labor & Employment Law Department and co-head of the firm's Whistleblowing & Retaliation Group, resident in the Chicago office. Steven’s practice focuses on defending complex employment litigation involving claims of discrimination and harassment, wage-and-hour laws and breaches of restrictive covenants (e.g., non-competition agreements). He has successfully tried cases to verdict before judges and juries in Illinois, Florida and California, and defended what is reported to be the largest Illinois-only class action in the history of the U.S....

Phillipe Lebel labor & Employment Attorney Los Angeles Proskauer Law Firm

Philippe (Phil) A. Lebel represents employers in all aspects of employment litigation, including wage and hour, wrongful termination, discrimination, harassment, retaliation, whistleblower, trade secrets, and breach of contract litigation, in both the single-plaintiff and class-action context, at both the trial and appellate level, and before administrative agencies. Phil also represents employers in connection with labor law matters, such as labor arbitrations and proceedings before the National Labor Relations Board. Additionally, Phil counsels clients to ensure compliance with federal...

Pinny Goldberg Labor and Employment Lawyer Proskauer Rose Law Firm

Pinny Goldberg is an associate in the Labor & Employment Law Department. Pinny represents employers in a broad array of matters before federal and state courts, FINRA and other arbitration panels, and administrative agencies, including the EEOC and its state equivalents, and in pre-litigation negotiations. Matters he works on include discrimination and harassment, wage and hour, wrongful discharge, whistleblowing and retaliation, covenants not to compete, breaches of fiduciary duty, unjust enrichment, and tort and contract claims.