Dive Brief:

• The U.S. Court of Appeals for the Second Circuit created a federal appellate split this week when it revived a Dodd-Frank Act retaliation claim by an ex-finance director, who was responsible for the company’s financial reporting and compliance with accounting standards, according to a blog post from Littler, the employment law firm.
• The court held that he was protected even though he only raised claims of accounting fraud internally with his employer, but did not report them to the Securities and Exchange Commission before he was terminated.  
• The decision in Berman v. Neo @ Ogilvy LLC conflicts with the Fifth Circuit ruling in Asadi v. G.E. Energy (USA), L.L.C., that says only individuals who report directly to the SEC may bring retaliation claims under Dodd-Frank.

Dive Insight:

According to the Littler post, from attorneys Chip Jones III and Philip Storm, this circuit split increases the likelihood that the U.S. Supreme Court will enter the arena and make a decision on what many have called ambiguous language in the statute.

For employers, Jones and Storm write, the message is to stay the course, as the best insurance is still to have a well-designed internal investigation program to promptly receive and expertly resolve claims of misconduct – especially claims of retaliation as well as sound and well-documented reasons prior to terminating any employee.

Whether the Supreme Court or Congress will promptly address the conflict remains an open question, the two report.  Perhaps more importantly, though, all employers—public and private companies alike—should take the conflicting rulings as a reminder that government regulators and employees will aggressively pursue allegations of retaliation for making internal complaints, especially those related to reports of fraud and financial misconduct.