Murray v. UBS Securities, LLC, et al., No. 20-4202 (2nd Cir. Aug. 5, 2022)

The plaintiff in this case was hired as a strategist by an investment bank to prepare reports about the bank’s commercial mortgage-backed securities business (“CMBS”). As a CMBS strategist, the plaintiff was required by the U.S. Securities and Exchange Commission to certify that his reports were independently formulated and reflected his opinions. 

The bank asked the plaintiff to work with other departments so his reports maintained consistency with those departments. The plaintiff brought concerns to his supervisor that he was nothing more than a shill, which would be illegal, and shortly after this conversation, the plaintiff was terminated. 


The plaintiff felt his termination was retaliation for refusing to participate in illegal activities and sued the bank under the whistleblower protection provision of the Sarbanes-Oxley Act (“SOX”). At the time the matter was submitted to the jury, the trial judge instructed the jury that retaliation can be a “contributing factor” in firing a whistleblower. The plaintiff prevailed at trial and the bank appealed.


SOX prohibits publicly traded companies from taking adverse employment actions to “discriminate against an employee … because of” any lawful whistleblowing act. On appeal, the Second Circuit held that this language in SOX requires a whistleblower “to prove by a preponderance of the evidence that the employer took the adverse employment action against the whistleblower-employee with retaliatory intent—i.e., an intent to ‘discriminate against an employee … because of’ lawful whistleblowing activity.” By instructing on a “contributing factor” without the retaliatory intent element, the trial court failed to meet the statute’s requirement that the conduct be discriminatory—that is to say, that the adverse action was done with retaliatory intent to discriminate against the employee because of lawful whistleblower activity. 


The Takeaway

By requiring retaliatory intent, the court linked the adverse action to the whistleblower activity, which is the purpose of the statute. Other circuit courts have held that retaliatory intent is not an element of a SOX whistleblower claim.



EEOC v. Wal-Mart Stores East LP, No. 21-1690 (7th Cir. Aug. 16, 2022)

Recently, the Seventh Circuit Court of Appeals upheld a decision finding that pregnant workers do not have the same benefits as workers injured on the job. The U.S. Equal Employment Opportunity Commission (“EEOC”), which sued on behalf of female employees of a multinational retail company, attempted to argue that the U.S. Supreme Court decision in Young v. UPS meant the retailer should have to show why it barred pregnant workers from light duty. 

According to the EEOC, the Young decision, along with the Pregnancy Discrimination Act, require employers to do more than simply say why they have provided a benefit for a particular group of nonpregnant workers. Instead, the EEOC argued, the retailer should have to meet a higher burden and explain why it excluded pregnant workers from that benefit.


The Seventh Circuit disagreed, however, noting that “from [the retailer’s] standpoint, it had chosen for sound reasons to offer a benefit to a certain category of workers, those injured on the job, without intending to discriminate against anyone else with physical limitations, whether caused by off-the-job injuries, illness, pregnancy or anything else, to whom its reasons did not apply.” According to the court, the EEOC failed to show that any comparable workers besides those injured on the job benefited from the retail giant's light-duty policy. The court further noted that “offering temporary light duty to workers injured on the job pursuant to a state worker's compensation law is a 'legitimate, nondiscriminatory' justification for denying accommodations under [the retailer’s] policy to everyone else, such as individuals not injured on the job, including pregnant women.”