Article by Erika A. Kelton and Stephen S. Hasegawa published in The Wall Street Journal, 4/14/15.
“For more than 25 years we have seen companies make overblown claims of trade secrets and business confidentiality to conceal fraud and abuse and to intimidate individuals from reporting corporate wrongdoing to federal regulators. Eugene Scalia (“Blowing the Whistle on the SEC’s Latest Power Move,” op-ed, April 6) takes this one step further by claiming that companies’ constitutional rights are being violated by the Securities and Exchange Commission’s efforts to ensure that employees aren’t discouraged from reporting fraudulent conduct to federal regulators.
Mr. Scalia takes issue with the recent SEC enforcement action against KBR Inc. over the company’s confidentiality agreements. As part of the SEC order, KBR revised its confidentiality agreements to clearly state that employees aren’t prohibited from reporting possible legal and regulatory violations to the government. This change correctly balances the public’s interest in fraud enforcement and KBR’s interest in protecting proprietary information.”