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US Supreme Court reinstates jury verdict won by fired UBS whistleblower

On Behalf of | Feb 15, 2024 | Regulatory Investigations

The US Supreme Court has sided with a former UBS Group bond strategist in a landmark case involving corporate whistleblowers, according to AdvisorHub.

In a unanimous ruling against UBS, the high court reinstated a jury’s verdict in favor of Trevor Murray.  Murray, who worked for UBS’s commercial mortgage-backed securities business, was awarded over $900,000 by a jury in 2017 over his claim that he was fired illegally as retaliation by the firm after he refused to embellish his reports for clients and complained about being pressured to do so.

Murray asserted that UBS had violated the protections for whistleblowers that are set forth in the 2002 Sarbanes-Oxley Act. But the New York-based 2nd U.S. Circuit Court of Appeals overturned the jury verdict, saying it was not valid because the trial judge did not inform jurors that a whistleblower must prove that their employer intentionally retaliated against them.

UBS had argued that Murray was not fired as retaliation, but instead was terminated as part of company-wide layoffs amid a period of financial losses for the firm.

The Supreme Court granted Murray’s bid to review the appeals court decision and last week issued the ruling in his favor.  The court found that the Sarbanes-Oxley Act does not require whistleblowers to prove that they were the victims of intentional retaliation, but just requires them to show they were treated differently than other employees for reporting illegal conduct.

Writing for the court, Justice Sonia Sotomayor said, “It does not matter whether the employer was motivated by retaliatory animus or was motivated, for example, by the belief that the employee might be happier in (another) position.” Sotomayor wrote.  She said the burden of the plaintiff on intent is only to show that the protected activity was a “contributing factor in the unfavorable personnel action.”

UBS did not immediately respond to a request for comment.  A lawyer for Murray, Robert Herbst, said the decision was “a huge victory for whistleblowers all across the country.”

Advocates for whistleblowers said a decision to uphold the appeals court ruling would have discouraged individuals from coming forward to report wrongdoing at publicly traded companies.  The Sarbanes-Oxley Act prohibits publicly traded companies from retaliating against employees who report what they reasonably believe to be instances of criminal fraud or securities law violations.

Lewitas Hyman routinely represents financial advisors and other registered representatives who were wrongfully terminated by their firm. Our attorneys take a thoughtful approach to clients’ cases by first trying to work with the terminating firm concerning the Form U5 disclosure. When necessary, our attorneys are prepared to file wrongful termination and defamation claims. Contact Lewitas Hyman at (888) 655-6002 or through our online contact form for a free consultation.