In Weist v. Tyco Electronics Corp., 812 F.3d 310 (3d Cir. 2016), the Third Circuit affirmed the dismissal of a Sarbanes-Oxley (SOX) whistleblower retaliation claim that has been the subject of numerous court decisions. The plaintiff, a manager in Tyco’s accounts payable department, allegedly raised concerns regarding certain expenses and invoices submitted in connection with extravagant Tyco events. The case had been to the Third Circuit a few years earlier. In Weist v. Lynch, 710 F.3d 121 (3d Cir. 2013), the Third Circuit joined the growing number of courts giving deference to the U.S. Department of Labor Administrative Review Board’s new requirements for pleading “protected activity” under § 806 of SOX, and rejecting prior case law holding that violations of misconduct under SOX must “definitively and specifically” relate to one of the enumerated categories of violation in § 806 of SOX. After remand, the district court ultimately granted summary judgment in Tyco’s favor, concluding that the plaintiff had not shown that his complaints were a “contributing factor” to his discharge. On appeal, the Sixth Circuit defined a “contributing factor” as “any factor, which alone or in combination with other factors, tends to affect in any way the outcome of the decision.” Despite this liberal standard, the court, nevertheless, found that the plaintiff had failed to show that his complaints were a contributing factor in his termination.
The Weist decision highlights the importance of a credible investigation in defeating a whistleblower retaliation claim. The court noted the temporal proximity between the plaintiff’s complaints and the adverse employment action, which came approximately 10 months later after an internal investigation regarding sexual harassment allegations. The court further noted the plaintiff had received praise and commendation during and after his complaints. The court applauded the integrity of the company’s investigation that resulted in the termination, noting, among other things, that the human resource department members investigating sexual harassment claims against the plaintiff were not aware of his protected activity.