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Seventh Circuit Permits Whistleblower’s RICO Claims Based on SOX Violation to Go Forward

In an opinion that provides new ammunition for whistleblowers, the U.S. Court of Appeals for the Seventh Circuit permitted Michael DeGuelle’s claim for retaliation under the Racketeer Influenced and Corrupt Organizations Act (RICO) to continue.  According to his Complaint, Mr. DeGuelle had previously blown the whistle internally on tax law violations by his employer S.C. Johnson & Son, Inc., before he filed a claim under the Sarbanes-Oxley Act (SOX) with the Department of Labor.  Subsequent to this filing, Mr. DeGuelle was terminated in apparent retaliation for his SOX filing and whistleblowing activities.  Mr. DeGuelle filed a lawsuit alleging various state and federal claims.  Two of Mr. DeGuelle’s claims alleged that his former employer violated the federal RICO statutes based upon a pattern of racketeering activity, which includes violation of § 1513 of SOX.  Under this section of SOX, it is a crime to “knowlingly, with intent to retaliate, take[] any action harmful to any person, including interference with the lawful employment or livelihood of any person, for providing to a law enforcement officer any truthful information relating to the commission or possible commission of any Federal offense[.]” 18 U.S.C. 1513(e).   The Seventh Circuit stated that “[t]he language of § 1513(e) and logic imply that retaliatory actions always occur after a whistleblower reports others' wrongdoing,” and consequently the retaliation for such whistleblowing could be considered  part of a scheme to prevent disclosure, and thus a proper basis for a RICO claim.  This ruling permits whistleblowers who file a complaint under SOX and are retaliated against to take advantage of the increased damages provisions and attorney fees provisions of the federal RICO statutes.  Current or former employees who have blown the whistle against their employers, or who are contemplating blowing the whistle, should contact Ogborn Mihm LLP immediately to discuss their options.

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2416 Hits

Sexual Harassment in the News Again

The recent news surrounding multiple allegations against Presidential candidate Herman Cain has brought the issue of workplace sexual harassment into the spotlight again.  The allegations against Mr. Cain, whether true or not, reflect the serious nature of sexual harassment in today’s workplace.  Too often employees are forced to endure unwanted sexual advances, inappropriate sexual statements and generally offensive sexual conduct and comments that make the workplace a “hostile work environment.”  While isolated jokes, teasing or comments may not provide a sufficient basis for a sexual harassment claim based on a hostile work environment, the true test involves careful consideration of the subjective and objective factors involved in the particular circumstances.  In Christian v. AHS Tulsa Reg’l Med. Ctr., LLC, the Tenth Circuit Court of Appeals recently described these considerations as a two-part test, requiring the victim to first “establish that a reasonable person would find the work environment hostile or abusive,” and then to show “that she [or he] subjectively perceived the work environment to be hostile or abusive.”  In other words, to succeed on a sexual harassment claim based upon a hostile work environment, the victim must not only show that he or she perceived the circumstances to constitute a sexually hostile or abusive environment, but also that a reasonable person in the same situation would also perceive the circumstances to be sexually hostile or abusive.  Ariane De Vogue has posted a good article about sexual harassment and Mr. Cain on the ABC News Legal Blog at abcnews.go.com/blogs/politics/2011/11/sexual-harassment-where-is-line-drawn/.  Victims of sexual harassment in the workplace, amounting to a hostile work environment, should contact Ogborn Mihm immediately to discuss their potential claims.

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2071 Hits

Wal-Mart Gender Discrimination Class Action Isn’t Finished

Just four months after the U.S. Supreme Court dismissed their nationwide class action lawsuit for gender discrimination, Betty Dukes and other current and former Wal-Mart employees are back.  Although the Supreme Court’s decision in June held that the original plaintiff class did not meet the commonality requirements for class certification, it did not rule on the substance of the class Complaint, i.e. whether Betty Dukes and other female Wal-Mart employees had in fact been victims of sexual discrimination.  The Supreme Court did however lay out specific guidelines for class certification, including a more stringent commonality requirement.  As Justice Scalia wrote for the five justice majority, the class certification failed in part because the case involved “literally millions of employment decisions,” and the plaintiffs could not point to “some glue holding the alleged reasons for all those decisions together.”  Consequently, on October 26, 2011, a fourth amended complaint was filed in the Dukes v. Wal-Mart Stores, Inc. case in the U.S. District Court for the Northern District of California.  This complaint specifically limits the potential class to female Wal-Mart employees in California and some surrounding areas.  The complaint also attempts to correct other issues of commonality noted by the Supreme Court, by focusing on the common facts of the class claims and the narrowed focus of the class representation.  The complaint describes the California region of Wal-Mart stores as implementing a “good old boy philosophy” where job opportunities were passed along by word-of-mouth, rather than being posted, and usually given to men.  Employees and former employees who believe that they are or have been the victim of gender discrimination in the workplace should contact the employment discrimination attorneys at Ogborn Mihm LLP of Denver, Colorado, as soon as possible to discuss their potential claim. 

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2107 Hits

Former Associate of International Law Firm Sued for Legal Malpractice

The international law firm Crowell & Moring is being sued for legal malpractice by a client who alleges that one of its former associates “improperly diverted” millions of dollars in escrow funds that were supposed to be held in the law firm’s account.  The former associate, Douglas R. Arntsen, was recently arrested in Hong Kong for charges related to the alleged wrongdoing.  The plaintiff alleges that Crowell & Moring engaged in professional negligence and breached ethical and contractual duties when it failed to monitor the funds which it held in escrow and failed to prevent its employees from improperly diverting such funds.  A total award in excess of $6 million is sought by the plaintiff, which includes over $5.5 million in funds that were supposed to be held in escrow, as well as attorney fees and costs.  This legal malpractice lawsuit against a powerhouse international law firm is just another example of the recent increase in cases involving “rogue” professionals who have used their positions of power and trust to steal funds from their clients and employers.  Individuals who have been victims of such legal malpractice or corporate wrongdoing should contact Starrs Mihm LLP immediately to protect their rights and interests.

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3007 Hits

EEOC Files Discrimination Suit Against Bass Pro Shops

The Equal Employment Opportunity Commission (EEOC) filed a lawsuit on Wednesday September 21, 2011, against Missouri based outdoor supplies retailer Bass Pro Shops in the United States District Court for the Southern District of Texas, Houston Division.  The lawsuit alleges that the retailer has engaged in a pattern of illegal ethnic background and racial discrimination against black and Hispanic workers and job applicants, retaliated against employees who raised questions, and destroyed records.  As the Chair of the EEOC, Jacqueline A. Berrien, stated, “Excluding qualified individuals from employment because of their race or ethnicity or in retaliation for exercising protected rights are fundamental violations of the laws we enforce.”  Title VII of the Civil Rights Act of 1964 prohibits discrimination based on race and national origin, and prohibits employers from retaliating against employees who complain about employment discrimination.  Individuals who believe they may be victims of employment discrimination because of their ethnic background or race should contact Ogborn Mihm LLP regarding their potential claims.

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2279 Hits

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