How Do You Qualify As a Whistleblower Under the Dodd-Frank Act? Blowing the Whistle on a Circuit Split

Abstract

Recently, a circuit split has arisen in respect of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The circuit split concerns the question of what it takes for an individual to qualify as a “whistleblower” for the purposes of the statute. This circuit split is surprising as the Dodd-Frank Act purports to answer this question itself by providing a definition of this term, a definition which the Fifth Circuit has treated as being conclusive. Nonetheless, the Second and the Ninth Circuits have held that in respect of some, but not all, of the Dodd-Frank Act this statutory “whistleblower” definition does not apply. Shortly the Supreme Court will have the opportunity to resolve the matter when it hears an appeal of the Ninth Circuit’s decision in Somers v. Digital Realty Trust Inc. This article provides three broad reasons for why the Supreme Court should reject the Second and Ninth Circuits’ interpretation. First, the interpretation endorsed by the Second and Ninth Circuits is the result of a flawed exercise in statutory interpretation that incorrectly applies principles recently set down by the Supreme Court in King v. Burwell and Utility Air Regulatory Group v. EPA. Secondly, while the Second and Ninth Circuits rejected the Fifth Circuits’ interpretation on the basis that it withholds the protection of the Dodd-Frank Act from auditors and attorneys, the Second and Ninth Circuits’ preferred interpretation also fails to protect auditors and attorneys. Finally, in any event the policy reasons in favor of extending the Dodd-Frank Act’s whistleblower protections to auditors and attorneys are insufficiently strong to warrant departing from the natural meaning of the statutory language at issue.