Anti-Corruption Report includes comments from Phillips & Cohen partner Erika Kelton in its analysis of the Ninth Circuit Court of Appeals ruling in a case involving Bio‑Rad Laboratories Inc. and a whistleblower alleging violations of the Foreign Corrupt Practices Act.
“As the court points out, even though the FCPA is not itself a ‘rule or regulation’ promulgated by the SEC, the SEC has in fact adopted relevant rules to implement the FCPA – most notably the ‘books and records’ rules found at Rule 13b2-1, 13b2-2,” Erika Kelton, a partner at Phillips & Cohen who specializes in representing whistleblowers, explained to the Anti-Corruption Report. “Thus, the 9th Circuit did not appear to rule out entirely a [Sarbanes-Oxley Act] Section 806 claim based on FCPA violations, as long as the [Sarbanes-Oxley Act] claim is grounded in the SEC’s rules rather than the FCPA statute,” she said. As such, this technical reading “may not be as drastic as one might think on first reading.
“I think that the ruling will have relatively limited impact outside of requiring litigants to take special care when presenting their evidence and preparing jury instructions,” Kelton explained. Thus, she does not believe whistleblowers will be dissuaded by the ruling, “nor should they be.” Indeed, Kelton reports that she has seen an uptick in contacts from individuals with evidence of FCPA violations since the decision came down.
Read the entire article, “Ninth Circuit Limits Protections for Whistleblowers Reporting FCPA Violations,” on Anti-Corruption Report’s website (subscription required).