Ruling Limits Whistleblowers To Nuclear Option

A Supreme Court decision earlier this year has overturned understanding of the test for employees to gain whistleblower status. Per Digital Realty Trust, Inc. v Somers, whistleblower protections against retaliation under Dodd-Frank legislation will take effect only in cases where a report is made directly to the SEC; an employee reporting internally, within a company, will not gain whistleblower status. Employees are thus presented with a difficult decision: Take the more cautious approach of raising concerns internally but risk not being protected from retaliation, or take “the nuclear option” and go straight to the SEC.