Digital Realty Trust, Inc. v. Somers
Issues
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, do the anti-retaliation protections for whistleblowers apply to an individual who reports a securities law violation internally but who has not reported it to the Securities and Exchange Commission?
This case asks the Supreme Court to clarify whether the anti-retaliation provision of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank Act”) provides protection for individuals who report fraud or corporate misconduct internally and not to the Securities and Exchange Commission (“SEC”). Although the statutory definition of “whistleblower,” as well as previous SEC interpretation of the statute, indicate that an individual must report misconduct to the SEC to reap the benefits of the anti-retaliation provision, the SEC has recently changed its interpretation. Under its new interpretation, the SEC has found that even those who only report to internal senior management have a right to these protections. Digital Realty Trust, Inc. (“DRT”) argues that the SEC’s interpretation is at odds with the clear meaning of the Dodd-Frank Act’s provisions and was not issued in a procedurally valid manner. Paul Somers, a former employee of DRT, counters that the term “whistleblower” in the Dodd-Frank Act is ambiguous and that the SEC’s interpretation is reasonable and valid. With this decision, the Supreme Court will determine the statutory rights of securities violation whistleblowers and what procedures whistleblowers must use when reporting in order to invoke the anti-retaliation protections prescribed by the Dodd-Frank Act.
Questions as Framed for the Court by the Parties
Whether the anti-retaliation provision for “whistle-blowers” in the Dodd-Frank Wall Street Reform and Consumer Protection Act extends to individuals who have not reported a violation of the securities laws to the Securities and Exchange Commission and thus fall out-side the Act’s definition of a “whistleblower.”
Petitioner Digital Realty Trust, Inc. (“DRT”) is a corporation that employed Respondent Paul Somers (“Somers”) as Vice President of Portfolio Management from 2010 until they fired him in April 2014. See Brief for Petitioner, Digital Realty Trust, Inc., at 9.
Written by
Edited by
Additional Resources
- Vedder Price, The Bumpy Road to Protection for Internal Whistleblowers, Vedder Thinking Articles (Mar. 27, 2017).
- Victoria M. Vitarelli, Is Internal Reporting Sufficient for Retaliation Protection Under Dodd-Frank?—Ambiguity Requires Deference Be Given to the SEC, Which Says Yes, Law School Student Scholarship. Paper 892 (2017).