Litigation

U.S. Supreme Court: Murray v. UBS Securities, LLC, 144 S. Ct. 445 (2024)

The U.S. Supreme Court recently held that proving an employer’s retaliatory intent is not required for whistleblowers seeking protection under the Sarbanes-Oxley Act. In Murray v. UBS Securities, LLC, 144 S. Ct. 445 (2024), the justices unanimously held that a potential whistleblower must “prove that his protected activity ‘was a contributing factor in the unfavorable personnel action alleged in the complaint,’ 49 U. S. C. § 42121(b)(2)(B)(i), but he is not required to make some further showing that his employer acted with ‘retaliatory intent.’”

This case arose from Trevor Murray’s employment as a research strategist at UBS, where he was responsible for reporting on the firm’s commercial mortgage-backed securities markets to current and future customers. While SEC regulations required Murray to certify that his reports were produced independently, Murray alleged that the firm pressured him to skew his reports in their favor. After complaining to his superiors, Murray was terminated by UBS in 2012.

Murray then filed a complaint with the Department of Labor alleging UBS violated the Sarbanes-Oxley Act, and later filed an action in the U.S. District Court for the Southern District of New York. The jury entered a verdict for Murray, which the U.S. Court of Appeals for the Second Circuit vacated and remanded for a new trial.

The Second Circuit considered 18 U.S.C. § 1514A(a), the Sarbanes-Oxley Act’s whistleblower-protection provision, which states that “no covered employer may ‘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.” UBS argued, and the Second Circuit agreed, that the word “discriminate” in § 1514A(a) imposes a “retaliatory intent” requirement on whistleblower plaintiffs.

On appeal, the U.S. Supreme Court reversed and remanded, holding the “only intent that § 1514A requires is the intent to take some adverse employment action against the whistleblowing employee ‘because of’ his protected whistleblowing activity.”

Justice Sotomayor authored the unanimous majority opinion. Justice Alito filed a separate concurring opinion, joined by Justice Barrett.