FEDERAL DISTRICT COURT JURISDICTION; RESPONDENT NOT NAMED IN THE ADMINISTRATIVE COMPLAINT
In Hanna v. WCI Communities, Inc., No. 04-80596-CIV. (S.D. Fla. Nov. 18, 2004), the district court dismissed the action against an individual who had been mentioned but not listed as a named Respondent. in the original administrative complaint filed with DOL, thereby depriving DOL of the opportunity to issue a final decision within 180 days of the filing of the administrative complaint. The court rejected the Plaintiff's assertion that his claim should not be dismissed against this individual because he had been identified in the original DOL complaint as having a role in the Plaintiff's termination. The court wrote:
Mr. Hanna's argument misunderstands the purpose of filing an administrative complaint under the Sarbanes-Oxley Act's procedural framework. ...[T]he Act requires an aggrieved employee to file an administrative complaint to "afford OSHA the opportunity to resolve the allegations administratively." Willis v. VIE Financial Group, Inc., No. 04-435, 2004 U.S. Dist. LEXIS 15753 (E.D. PA. Aug. 6, 2004) (citing 18 U.S.C. § 1514A(b)(1)(A); 29 C.F.R. § 1980.103(e)). Mr. Hanna's failure to name Mr. Eure in his administrative complaint failed to afford OSHA the opportunity to resolve Mr. Hanna's allegations through the administrative process. Even if the court assumed that Mr. Eure was placed on notice that he had allegedly violated the law, that notice has no consequence as to whether OSHA was placed on notice that it was required to investigate Mr. Eure's actions in this case.
JUDICIAL NOTICE; FEDERAL COURT CAN TAKE JUDICIAL NOTICE OF DOL ADMINISTRATIVE RECORD
A federal district court can take judicial notice of the DOL administrative record in a SOX whistleblower proceeding. McClendon v. Hewlett-Packard Co., 2004 WL 1421395 (D.Idaho June 9, 2005) (case below ALJ No. 2005-SOX-3).
In Schmidt v. Levi Strauss & Co., No. 5:05-cv-01026 (N.D.Cal. Mar. 28, 2008), the court granted the Defendant's motion to strike the Plaintiff's jury demand in a SOX whistleblower case. The court struck the demand without prejudice to renew if later legal authority supports such a demand. However, the court reviewed the sparse caselaw from other district courts on jury demands in SOX cases, reviewed the applicable legislative history, and analyzed the matter under the Seventh Amendment, and concluded that such a right did not exist.
JURY TRIAL; WHETHER A RIGHT TO A TRIAL BY JURY IS FOUND IN THE SOX WHISTLEBLOWER PROVISION
In McClendon v. Hewlett-Packard Co., 2004 WL 1421395 (D.Idaho June 9, 2005) (case below ALJ No. 2005-SOX-3), the Defendant moved to strike the Plaintiff's demand for a jury trial in regard to an ERISA employee protection claim. The Plaintiff had also filed a SOX employee protection claim, and the Defendant's motion was based on the assumption that the court had granted a motion to dismiss or summarily adjudicate the SOX claim. The court, however, had denied summary adjudication of the SOX claim, and therefore denied the motion to strike the demand for jury trial.
[Editor's note: implicit in this ruling is the assumption that a jury trial is available in a SOX claim; however, the court did not specifically address this question].
JURY TRIAL; WHETHER A RIGHT TO A TRIAL BY JURY IS FOUND IN THE SOX WHISTLEBLOWER PROVISION
In Murray v. TXU Corp., 2005-WL-1356444 (N.D.Tex. June 7, 2005), the district court struck the Plaintiff's motion for a jury trial on his SOX employee protection claim. The Defendant moved to strike the demand for a jury trial on the ground that the SOX only provides for equitable relief. The court rejected the Plaintiff's contention that the SOX's reference to an "action at law" implied a right to a jury trial. The court also rejected the Plaintiff's contention that he was entitled to a jury trial because he seeks legal claims of exemplary damages and reputational injury, the court finding that neither of those types of relief are available under the SOX whistleblower provision. Finally, the court also rejected the Plaintiff's contention that the legislative history supported a right to a jury trial. The court, however, stated that it would consider use of an advisory jury if requested by the parties.
JURY TRIAL; SCANT AUTHORITY ON WHETHER JURY TRIAL MAY BE DEMANDED ON A SOX WHISTLEBLOWER CLAIM
In Fraser v. Fiduciary Trust Co., 417 F.Supp.2d 310 (S.D.N.Y. 2006), the court denied the Defendant's motion to strike a jury trial demand for a SOX whistleblower claim without prejudice to bring the motion again prior to trial. The court observed that SOX was silent as to whether a litigant could demand a jury trial, and that it had only found one published decision which considered that issue, Murray v. TXU Corp., 03 Civ. 0888 (N.D.Tex. June 7, 2005). In Murray the court struck the jury demand. The Fraser court deferred a dispositive ruling on the issue based on the possibility that other courts will have considered the issue if at a later junction the motion was again filed.
PLEADING REQUIREMENTS; DISORGANIZED AND INDEFINITE COMPLAINT; COURT WILL NOT WASTE ITS TIME SEARCHING FOR THE LEGAL THEORY OF THE COMPLAINANT
In Stone v. Duke Energy Corp., No. 3:03-CV-256 (W.D.N.C. Feb. 11, 2004), the court dismissed the Plaintiff's Sarbanes-Oxley Act whistleblower complaint for failure to contain "a short and plain statement of the claim" as required by FRCP 8 and failure to present claims in separate counts for clear presentation of the matters set forth as required by FRCP 10. The court wrote that it would "not waste its time searching through Plaintiff's disorganized and indefinite Complaint for a prima facie case. See, e.g., Cass v. Richard Joshua Tobacco Co., Inc., 1998-WL-834856, *2 (M.D.N.C. 1998) (‘The Complaint . . . is a rambling fount of senseless writing . . . . [which] lacks sufficient factual allegations for the court to wade through the ramblings in search of a possible legal theory.')."
ADEQUACY OF COMPLAINT UNDER FRCP 8(a); INCOMPREHENSIBLE AND VERBOSE COMPLAINT
In Powers v. NWA, Inc., No. 05-2468 (W.D.Tenn. Feb. 23, 2006), the district court required the Plaintiff to file an amended complaint where the original complaint failed to comply with FRCP 8(a)(1) (short and plain statement of grounds for jurisdiction) and FRCP 8(a)(2) (short and plain statement of the claim showing that the pleader is entitled to relief). Although it was apparent that the complaint was being brought under the whistleblower provision of the SOX, the complaint failed to identify which of 45 named parties were the Plaintiff’s employer or company representative who allegedly retaliated against the Plaintiff for whistleblowing activities, the complaint asserted many other counts apparently not arising under the SOX, it was unclear whether any of the other counts provided a basis for federal subject matter jurisdiction, and it was unclear which administrative proceedings discussed in the complaint were at issue before the district court. The court characterized the complaint as incomprehensible, and found the pleading to be so verbose that it could not clearly identify the claims of the pleader nor adjudicate the claims understandingly on the merits. The court provided specific instructions on what, as a minimum, would be required in the amended complaint.
In Blagrave v. Nutrition Management Services Co., No. 05-6790 (E.D.Pa. July 8, 2008) (case below 2005-SOX-75), the court granted partial summary judgment in favor of the Defendant in regard to alleged protected activity under SOX that was not supported by any evidence of record other than the Plaintiff's own declaration filed in opposition to the motion for summary judgement. The court found the declaration incompetent under the "sham affidavit doctrine." The court found that the declaration was offered solely to defeat the summary judgment motion, and that the Plaintiff had failed to offer any explanation as to why the information set forth in his declaration was not disclosed in his answers to detailed questions asked of him at two depositions or in response to interrogatories. The court also granted summary judgment in regard to alleged protected activity on which the Plaintiff had failed to cite any evidence that he complained to his superior about those matters. The court, however, denied summary judgment in regard to matters in which a genuine issue of material fact existed as whether the Plaintiff could make out a prima facie case.
SUMMARY JUDGMENT; SHAM AFFIDAVIT RULE AS PREVENTING CREATION OF GENUINE ISSUE OF MATERIAL FACT
In Van Asdale v. International Game, Technology, No. 3:04-CV-00703-RAM (D.Nev. June 13, 2007), the Plaintiffs, who were in-house intellectual property attorneys for the Respondent, alleged that they met with the Defendant's General Counsel to express their views on the invalidity of a patent held by a company which the Defendant was considering acquiring by merger, and to express concern that fraud had occurred. The Magistrate Judge granted summary judgment against the Plaintiffs on this alleged act of protected activity because the deposition testimony of one of the Plaintiffs indicated that the potential for "fraud" related to fraud against the patent office rather than fraud against shareholders. Citing the "sham" affidavit rule, the Magistrate refused to permit the Plaintiffs to create a genuine issue of material fact by submitting a declaration stating that the Plaintiff whose deposition testimony had been cited had referenced a need to investigate for fraud on the shareholders. See alsoVan Asdale v. International Game, Technology, No. 3:04-CV-00703-RAM (D.Nev. Aug. 10, 2007) (Order [denying reconsideration]).
Back to top
