The U.S. Supreme Court has ruled in Lawson v. FMR, LLC, that contractors and subcontractors of publicly traded companies are fully protected under the Sarbanes-Oxley Act for corporate whistleblowers.
The Supreme Court explicitly held that investment advisors and other “independent contractors” employed in the mutual fund industry are fully protected under the Sarbanes-Oxley Act’s whistleblower provisions.
The Supreme Court’s ruling reversed a lower court holding excluding the mutual fund industry from protection under Sarbanes-Oxley.
“The Supreme Court closed a potentially devastating loophole in corporate whistleblower protection,” said Stephen M. Kohn, Executive Director of the National Whistleblower Center. “By ruling that contractors and subcontractors of publicly traded companies are fully protected under the corporate whistleblower provisions, the Court has put an end to the popular shell game which large companies use try to silence whistleblowers.”
The National Whistleblower Center filed a friend of the court brief before the Supreme Court in this case and has been instrumental in defending the Sarbanes-Oxley Act from corporate attempts to undermine its effectiveness.