Sarbanes-Oxley Act (SOX)
Whistleblower Digest
FILING OF COMPLAINT
[Last Updated Jan. 28, 2015]

Table of Contents

Timeliness: Generally

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FEDERAL COURT DECISIONS

SOX RETALIATORY DISCHARGE SUIT IN FEDERAL COURT IS GOVERNED BY FOUR YEAR STATUTE OF LIMITATIONS UNDER 28 U.S.C. § 1658(a), AND NOT THE TWO YEAR STATUTE OF LIMITATIONS UNDER 28 U.S.C. § 1658(b)(1)

In Jones v. Southpeak Interactive Corp. of Delaware , No. 13-2399 (4th Cir. Jan. 26, 2015) (2015 WL 309626; 2015 U.S. App. LEXIS 1114), after more than 180 days passed without a final order from OSHA on her SOX complaint, the Appellee notified OSHA that she was electing to file a federal lawsuit. The Appellee waited nearly two years to file the federal suit, which was a little less than three years after her termination from employment. The district court held that the SOX claim was timely because it was commenced within the four-year statute of limitations under 28 U.S.C. § 1658(a). On appeal, the Appellants argued that the two-year limitations period set forth in § 1658(b)(1) applied. The Fourth Circuit rejected the Appellants' argument, finding that the SOX complaint alleged, not fraud as covered by § 1658(b), but retaliatory discharge. In a SOX retaliatory discharge case, the whistleblower is not required to prove that the employer's conduct was, in fact, a legally actionable fraud. The court recognized that the Appellee's complaint approximated the basic elements of a section 10(b) securities fraud claim, but noted that the retaliation complainant is not under an obligation to establish scienter. The court therefore held that Section 1658(a) controls, and that because the Appellee brought her suit within that Section 1658(a)'s four-year window, her claim was timely.

TIMELINESS AND PROTECTED ACTIVITY IN SOX COMPLAINTS; PLAINTIFFS ARE AFFORDED A FULL SPAN OF NINETY DAYS AFTER THE VIOLATION TO FILE A SOX ACTION, AND IF THE NINETIETH CALENDAR DAY IS SATURDAY, SUNDAY OR HOLIDAY, THE PERIOD DOES NOT EXPIRE UNTIL THE END OF THE NEXT BUSINESS DAY

In Gladitsch v. Neo@Ogilvy , No. 11 Civ. 919 DAB, 2012 WL 1003513 (S.D.N.Y. Mar. 21, 2012), the plaintiff, an Associate Media Director, served on the company's IT Planning Team, and noticed in a proposal sent by one of the company's media service vendors that the vendor intended to substantial overcharge a client. The plaintiff immediately notified the Director of Media Management, and after she met with the vendor to discuss the proposed charges, it was revealed that the company had used the proposed pricing scheme for years. As a result, it appeared to the plaintiff that the company had overcharged the client by several million dollars. The plaintiff complained to her direct supervisors on the IT Planning Team, and when billing practices remained unchanged, she arranged a meeting to discuss the billing scheme with the company's Managing Director and other upper-level management. However, rather than correct the problem, the plaintiff alleged that her supervisors retaliated against her by threatening her and removing her from the client's account. Despite a history of consistently positive performance reviews, her next performance review criticized her performance, and specifically mentioned that she had been distracted by the company's billing practices. She also did not receive a promotion that she had been promised prior to discovering and complaining about the billing practices, and was instead demoted to a position she had held three years earlier. She filed a claim with OSHA under SOX, and after 180 days without a decision, filed in federal court.

First, the district court found that Section 929A of the Dodd-Frank Act - which amended Section 1514A to clarify that its protections cover subsidiaries of publicly-traded companies - applies retroactively, because it is a "clarifying" amendment that does not "effect a substantive change in the law," but rather "correct[s] a misinterpretation." Gladitsch at *4. Consequently, the defendant in the instant case is covered under SOX as a subsidiary of a publicly-traded company. The court also found that Neo and Ogilvy - which "share common ownership, premises, directors and/or officers, and financial control" - were a single or joint employer of the plaintiff. Id. at *5.

The defendants' argued that the plaintiff's complaint that her negative performance review was retaliatory was not timely filed because it occurred exactly 91 days prior to her filing with OSHA. However, the district court explained that plaintiffs are allotted "a full span of ninety days in which to file [their] action, and accordingly, when the ninetieth calendar day is a Saturday, Sunday, or holiday, the period does not expire until the end of the next day." Id. (citing Kane v. Douglas, Elliman, Hollyday & Ives , 635 F.2d 141, 142 (2d Cir.1980)). In this case, "ninetieth calendar day following Plaintiff's performance review was a Sunday, and Plaintiff's complaint with OSHA was filed the next business day," and therefore "falls within the limitations period." Id.

TIMELINESS OF COMPLAINT FILED AFTER EFFECTIVE DATE OF DODD-FRANK AMENDMENTS TO SOX

In Ashmore v. CGI Group Inc. , No. 11 Civ. 8611, 2012 WL 2148899 (S.D.N.Y. June 12, 2012), the court found that the plaintiff's SOX complaint to OSHA was timely under the post-Dodd-Frank Act 180-day filing timeframe, because he the plaintiff "filed both his whistleblower complaint with the Secretary and his civil complaint with this Court after the 2010 amendments went into effect - [and] the 180-day statute of limitations thus applies without raising any retroactivity concerns." Ashmore at *5.

ADMINISTRATIVE REVIEW BOARD DECISIONS

TIMELINESS OF FILING OF SOX WHISTLEBLOWER COMPLAINT; COMPLAINT IS FILED WHEN MAILED RATHER THAN WHEN RECEIVED; ALJ'S OBTAINING OF ENVELOPE FROM OSHA TO DETERMINE POSTMARK WAS NOT PREJUDICIAL; ENVELOPE WAS A MATTER OF PUBLIC RECORD

In Barrett v. e-Smart Technologies, Inc. , ARB Nos. 11-088, 12-013, ALJ No. 2010-SOX-31 (ARB Apr. 25, 2013), the ARB found that substantial evidence supported the ALJ's finding that the Complainant's SOX complaint was filed timely. The ALJ determined the date on which the Complainant was constructively discharged, and then obtained the envelope from OSHA that the Complainant had used to mail his complaint. Based on the postmark on that envelope, the ALJ determined that the complaint was timely. See 29 C.F.R. § 1980.103(d). On appeal, the Respondent argued that date OSHA received the complaint was the date of filing and not the date of postmark. The ARB held that "as a matter of law the ALJ was correct in relying upon the ... mailing postmark date as the date upon which Barrett filed his OSHA complaint." USDOL/OALJ Reporter at 6.

The Respondent also claimed it was error for the ALJ to ask OSHA for the postmarked envelope and that the Complainant himself should have entered this into evidence. The ARB found that nothing prevented the Respondent from cross-examining the Complainant regarding when he mailed the letter, and that introducing the envelope into evidence did not prejudice the Respondent. The ARB also found that the postmarked envelope was a matter of public record of which the ALJ could have taken official notice. 29 C.F.R. § 18.201.

TIMELINESS OF COMPLAINT; DODD-FRANK AMENDMENT TO SOX SECTION 806 LENGTHENING LIMITATIONS PERIOD DOES NOT LENGTHEN LIMITATIONS PERIOD ON CLAIM ARISING PRIOR TO THAT AMENDMENT

In Lewis v. Walt Disney World , ARB No. 10-106, ALJ No. 2010-SOX-27 (ARB Jan. 27, 2012), the ARB noted that Section 806 of the Corporate and Criminal Fraud Accountability Act of 2002, Title VIII of the Sarbanes-Oxley Act of 2002, 18 U.S.C.A § 1514A, and its implementing regulations at 29 C.F.R. Part 1980 had been amended since the Complainant filed his complaints to expand the limitations period from 90 to 180 days. See Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. 111-203, 124 Stat. 1376 (July 21, 2010); 76 Fed. Reg. 68084-97 (Nov. 3, 2011). The ARB held that the Complainant's complaints were time-barred under the SOX when filed in 2008, and that the amended SOX limitations period did not revive the complaints. See Berman v. Blount Parrish & Co., Inc., 525 F.3d 1057 (11th Cir. 2008)(amended limitations period does not revive SOX securities claims on which the previous statute of limitations had run).

TIMELINESS OF COMPLAINT; COMPLAINT BROUGHT THREE YEARS AFTER END OF LIMITATIONS PERIOD FOUND NOT TO JUSTIFY PAYMENT OF $1000 BY PRO SE COMPLAINANT

In Greene v. Omni Visions, Inc. , ARB No. 09-109, ALJ No. 2009-SOX-44 (ARB Mar. 9, 2011), the Complainant was terminated from her employment, and 213 days later she filed a False Claims Act complaint in federal district court. 517 days after she voluntarily dismissed the False Claims Act complaint, and 1024 days after her termination from employment, she filed a SOX whistleblower complaint with OSHA. Both OSHA and the ALJ found that the complaint was not timely filed. The ALJ rejected the Complainant's arguments why equitable tolling should apply. On appeal, the ARB affirmed the denial. The Complainant first argued that she had been misled by her attorney because he had told her that filing a SOX complaint was not an option while the False Claims Act complaint was pending. The ARB found that the Complainant freely chose her attorney and must bear the consequences of any acts or omissions by that attorney. The Complainant argued that tolling should apply because the Respondent had not disclosed to her that it was an "employee stock ownership plan corporation." The ARB found that the Complainant did not explain why the fact that she did not know about the Respondent's corporate structure precluded the timely filing of her SOX complaint, or why the Respondent had an obligation to inform her of the corporate structure. The ARB found no support for the contention that the False Claims Act was a filing of the precise claim in the wrong forum, and that even if it was an extraordinary event that prevented a timely filing, she still waited 517 days after that complaint was dismissed to file her SOX complaint. The ARB also rejected the arguments that the SOX complaint should not be dismissed because of the serious nature of her concerns with the Respondent's business practice and because of a lack of prejudice to the Respondent. The ARB stated that neither of those factors are a basis for equitable tolling.

The Respondent moved for an award of $1,000 in attorney fees pursuant to 29 C.F.R. § 1980.110(e), on the ground that the Complainant filed the SOX three years after the limitations period had expired, with no recognized basis for doing so. The ARB found some merit to the request, but because of the Complainant's pro se status declined to find that the complaint was totally baseless or brought in bad faith. Thus, the ARB denied the motion.

TIMELINESS; RESPONDENT DOES NOT HAVE THE RESPONSIBILITY TO INFORM THE COMPLAINANT OF THE SOX WHISTLEBLOWER PROVISIONS' FILING DEADLINES

In McCloskey v. Ameriquest Mortgage Co. , ARB No. 08-123, ALJ No. 2005-SOX-93 (ARB Aug. 31, 2010), the Complainant argued that his SOX whistleblower complaint should be equitably construed as timely because the Respondent had a burden to inform him of the existence of the SOX, and failed to do so. The Complainant contended that the Respondent bore this burden based on the requirement to certify financial reports under Section 302 of the SOX. The ARB found that the Respondent did not have a burden to inform the Complainant of the whistleblower provision of the SOX and its filing deadlines, and that Section 302 was inapposite to the Complainant's case.

MOTION FOR SUMMARY DECISION CONCERNING TIMELINESS OF COMPLAINT; RESPONSE BY COMPLAINANT THAT CONTRADICTED EARLIER ADMISSIONS FOUND INSUFFICIENT TO RAISE GENUINE ISSUE OF MATERIAL FACT

In Salian v. Reedhycalog UK , ARB No. 07-080, ALJ No. 2007-SOX-20 (ARB Dec. 31, 2008), the Complainant failed to met his burden of raising a genuine issue of material fact sufficient to defeat the Respondent's motion for summary decision asserting that the complaint was not timely filed, where - although the Complainant denied receiving "unequivocal" notice of his termination - he had admitted that he had received a letter indicating that his position within the company had "become redundant" and that he was being given thirty days, and had admitted that he was escorted from the premises. The Board wrote: "In contradicting his own admissions, Salian's Response could be construed as a false or fraudulent affidavit, and as such, it would be insufficient to defeat ReedHycalog UK's motion for summary decision." USDOL/OALJ Reporter at 6 (footnote omitted).

TIMELINESS OF COMPLAINT

In Shelton v. Time Warner Cable , ARB No. 06-153, ALJ No. 2006-SOX-76 (ARB July 31, 2008), the ALJ properly dismissed the SOX complaint because it was filed more than 90 days after the adverse employment action. Earlier complaints to the Secretary of Labor and the Acting Assistant Secretary for OSHA presented claims pursuant to ERISA and Section 11(c) of the Occupational Safety and Health Act, but did not contain any allegation that the Respondent committed an act that constituted a violation of the SOX.

TIMELINESS OF COMPLAINT; FOCUS IS NOT ON WHEN THE COMPLAINT CONSTITUTING THE ALLEGED PROTECTED ACTIVITY OCCURRED, BUT WHEN THE COMPLAINT ABOUT THE RETALIATION OCCURRED

In Levi v. Anheuser Busch Companies, Inc. , ARB Nos. 06-102, 07-020, 08-006, ALJ Nos., 2006-SOX-27 and 108, 2007-SOX-55 (ARB Apr. 30, 2008), the Complainant had written a series of letters to government agencies making various complaints about the Respondent's behavior. After learning about SOX whistleblower protection, the Complainant wrote to the Secretary of Labor asking whether his previous letters had been considered to be SOX complaints. The ARB found that this letter, having been filed more than 90 days after the claim accrued, was not a timely SOX complaint.

Turning to the prior letters, the ARB found that complaints filed with government agencies about the Respondent's behavior, even assuming that they were SOX-related protected activity, do not present a cognizable SOX complaint where they occurred prior to the alleged retaliation taking place. In other words, to be cognizable, the Complainant must have filed a timely complaint after his discharge grounded in the allegation that his protected activity was a contributing factor in the adverse action taken by the Respondent.

TIMELINESS OF COMPLAINT; FILING BY E-MAIL; SUMMARY JUDGMENT STANDARD

The ALJ erred in granting summary judgment to the Respondent based on a finding that the complaint was not timely where OSHA did not receive the complaint until after the limitations period, but a handwritten note on the front of the complaint indicated that the complaint was "originally submitted via email" within the limitations period. Because SOX complaints may be filed by e-mail, 29 CFR § 1980.103(d), and viewing the evidence in the light most favorable to the non-moving party when deciding a motion for summary judgment, summary judgment should not have been granted. Reddy v. Medquist, Inc. , ARB No. 04-123, ALJ No. 2004-SOX-35 (ARB Sept. 30, 2005).

ADMINISTRATIVE LAW JUDGE DECISIONS

TIMELINESS OF COMPLAINT; PRESENCE OF NEGATIVE WRITE-UP IN PERSONNEL FILE

In Pittman v. Siemens AG , 2007-SOX-15 (ALJ July 26, 2007), the Complainant argued that a negative write-up that had been placed in his personnel file prevents his being rehired, and that every day that it remains in the file triggers a new statute of limitations. The ALJ, assuming for purposes of argument that the write-up was an adverse employment action, found that the Complainant's almost two year later SOX filing was untimely, noting that the Complainant had not provided any evidence of any specific acts of blacklisting or refusal to rehire based on the alleged write-up.

TIMELINESS OF COMPLAINT; LETTERS TO DOL OFFICIALS MUST RAISE ISSUE OF VIOLATION OF SOX; AFTER THE FACT CHARACTERIZATION OF ISSUES RAISED FOUND NOT TO BE PERSUASIVE

In Shelton v. Time Warner Cable , 2006-SOX-76 (ALJ Aug. 31, 2006), the Complainant had sent a series of letter to the Secretary of Labor and other DOL officials. Almost a year after his termination, he wrote to the Secretary asking about the status of his SOX whistleblower complaint. This letter was referred to OSHA, which treated it as a SOX complaint. OSHA dismissed, finding that the complaint was untimely. Before the ALJ, the Complainant argued that his earlier letters were timely SOX complaints. The ALJ analyzed each of the letters, and found that only the status letter referred to SOX or SOX-related activity. The ALJ found that the earlier letters alleged a breach of fiduciary duties under ERISA and violations of the FLSA. Although the Complainant argued that he had raised these issues because he reasonably believed that such practices were used to mask the Respondent's operating costs, artificially inflate its revenues, shore up its bottom line and intentionally misstate or misrepresent its financial condition to defraud shareholders and investors, the ALJ found, upon reviewing the record, that she was not persuaded that the complaints registered by the Complainant "were made because of a belief that Respondent was trying to defraud its shareholders and investors." Slip op. at 6. Citing caselaw under the ERA and CAA, the ALJ found that a SOX complaint "must contain a full statement of the acts and omissions, with pertinent dates, which are believed to constitute the violations." Slip op. at 6. Since none of the earlier letters provided information necessary to establish a SOX complaint, and the final letter was untimely, the ALJ granted the Respondent's motion to dismiss.

TIMELINESS OF COMPLAINT; SWORN AFFIDAVIT INSUFFICIENT, STANDING ALONE, TO ESTABLISH TIMELY FILING

In Barker v. Perma-Fix of Dayton, Inc. , 2006-SOX-1 (ALJ Jan. 11, 2006), the ALJ found that the complaint was untimely under the SOX whistleblower statute of limitations where the Complainant's only proof of date of mailing was her own affidavit. The only verifiable evidence of date of mailing was a postmark on an envelope received by OSHA, which was nine days beyond the limitations period. The ALJ noted that the SOX regulations expressly state that "the date of the postmark ... will be considered to be the date of filing." 29 C.F.R. § 1980.103(d). The Complainant argued that she should not be held accountable for the alleged mishandling of her letter by the regional OSHA office or the U.S. Postal Service. The ALJ rejected this argument, finding that it was her responsibility to make a timely submission, or provide proof that she attempted to make such a timely submission. The ALJ found that the affidavit was not sufficient proof of timely filing.

EVIDENCE; ADMISSIBILITY OF LETTER FROM SETTLEMENT NEGOTIATION WHEN USED IN ATTEMPT TO ESTABLISH TIMELY FILING OF COMPLAINT RATHER THAN TO PROVE LIABILITY OR DAMAGES

In Dolan v. EMC Corp. , 2004-SOX-1 (ALJ Mar. 24, 2004), the Complainant proffered a letter from the Respondent's counsel in which Respondent refused to remove a negative performance evaluation in an attempt to show that an act of retaliation had occurred within the limitations period for filing a SOX whistleblower complaint. The letter was in response to a letter from Complainant's counsel asserting that the performance evaluation was false and defamatory and suggesting that the Respondent should settle the matter, inter alia . The Respondent argued that its letter was inadmissible under FRE 408 because it was made as part of settlement negotiations. The ALJ, however, found that the policy favoring exclusion of settlement documents was to prevent chilling of nonlitigious solutions to dispute, and that exclusion of such documents is not required where the evidence is offered for a purpose other than to prove liability or damages. Since in the instant case the letter was proffered to establish the final retaliatory act against the Complainant, it was admissible. The ALJ also found that was not, in fact, an offer of settlement or compromise.

Trigger Date; Final, Definitive and Unequivocal Notice

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FEDERAL COURT DECISIONS

FACT THAT PLAINTIFF VOLUNTARILY RESIGNED AND DEFENDANTS NEVER COMMUNICATED TO HER A DISCRIMINATORY DECISION DOES NOT PREVENT LIMITATIONS PERIOD FOR SOX COMPLAINT FROM COMMENCING

In Connolly v. Remkes , No.: 5:14-cv-01344-LHK (N.D. Cal. Oct. 28, 2014), the court adopted the majority view that the Dodd-Frank whistleblower provision at 15 U.S.C. § 78u-6 protects internal whistleblowing, and deferred to the SEC interpretation in a case where the plaintiff internally raised violation of the FINRA rule.

The court rejected the plaintiff's argument that the SOX whistleblower provision at 18 USC § 1514A does not require exhaustion with OSHA. The plaintiff had argued that because the alleged wrong included a SOX component, she need not comply with the requirements of exhaustion of administrative remedies by filing a complaint with the Secretary of Labor before bringing an action under the Dodd-Frank At. The court found that this argument failed because there was no authority cited by the plaintiff to show that exhaustion of remedies is optional.

The court also rejected the plaintiff's argument that under Coppinger-Martin , 627 F.3d at 749, a SOX violation occurs "when the discriminatory decision has been both made and communicated to the complainant" and that because the Defendant had not communicated any such decision to the plaintiff (she having voluntarily resigned) the limitations period would never run. The court noted that Coppinger-Martin did not address a voluntary resignation, and that the 9th Circuit has held that in a constructive discharge case, the date of resignation triggers the limitations period. The court stated: "Connolly resigned, so she cannot claim ignorance about the timing of her constructive discharge. Moreover, if no discriminatory decision has occurred, it is unclear how Connolly has a ripe claim at all. Her bare assertion that the limitations period 'will never run when one resigns' is therefore baseless." Slip op. at 12. The court found that the SOX complaint was not timely filed, but granted the plaintiff leave to amend her SOX cause of action to allege facts to establish equitable tolling, if applicable.

The court also found that the plaintiff had not plead sufficient facts to claim that the defendants constructively discharged her. Specifically, she had not pleaded facts sufficient to show that she was "compelled to resign" and had not identified "extraordinary" or "egregious" working conditions during the relevant period. The court, however, granted the plaintiff leave to amend her complaint to allege additional facts to support her constructive discharge theory. The court stated that the plaintiff "must must allege additional facts to support an inference that 'the resignation was coerced,' ... and that she gave Defendants a 'reasonable chance' to resolve the dispute before resigning." Slip op. at 17 (citations omitted).

TIMELINESS OF SOX COMPLAINT; DETERMINING DATE OF VIOLATION UNDER SOX IS AN OBJECTIVE INQUIRY FOCUSING ON WHEN THE EMPLOYEE REASONABLY SHOULD HAVE KNOWN THAT THE ADVERSE ACTION WAS TAKEN

In Mart v. Forest River, Inc. , 854 F.Supp.2d 577 (N.D.Ind. Feb. 22, 2012), the plaintiff, the general manager (and heir-apparent to the CEO position) of a financial services company, discovered that the current CEO had used the defendant and two other "shadow companies" to engage in unlawful transactions. The plaintiff reported these discoveries to the CEO of the defendant's parent company, and subsequently confronted the current CEO about the transactions. The CEO threatened the plaintiff, subjected him to a hostile work environment, and ultimately terminated his employment, prompting the plaintiff to file a complaint with OSHA under SOX's whistleblower provision.

The defendant filed a motion to dismiss pursuant to FRCP 12(b)(1), arguing that the plaintiff failed to file a complaint with OSHA within 90 days of the date that the violation occurred, and therefore the court first set out to determine the date that the plaintiff was terminated. The defendant argued that the plaintiff was notified of the decision to terminate his employment either when he met with a human resources representative to discuss his termination, or the following day, when the human resources representative emailed him to confirm that he need not report to work because the defendant had made the decision to terminate him. Both of those dates occurred more than 90-days before complainant filed his retaliation complaint with OSHA. However, two weeks later, the human resources representative mailed an official letter memorializing the decision, and almost two months later, the plaintiff received a final letter from the defendant that "formally acknowledge[d]" that he had been terminated as of that week. The plaintiff asserted that either of these two later communications signified the date that the violation occurred, as both occurred within 90 days prior to the date the plaintiff filed a complaint with OSHA.

The district court, citing Flannery v. Recording Indus. Ass'n of Am. , 354 F.3d 632, 640 (7th Cir.2004), explained that determining the date that notice has been communicated is an objective inquiry that focuses on "when the employee knew, or reasonably should have known, that the adverse employment decision had been made." Mart at 601. In a discriminatory discharge case, the court looks for "a final, ultimate, non-tentative decision to terminate the employee," and "the employer must give the employee 'unequivocal' notice of its final termination decision." Id. at 601-602. In this case, the human resources representatives follow-up email did not use the term "terminate," but the language of the email "clearly indicated that a decision to terminate plaintiff had been made." Id. at 602. Additionally, the court found the language "sufficient to unequivocally notify plaintiff of the decision to terminate his employment," and therefore the court determined that the date of the human resources representative's email was the date that the violation occurred. Consequently, the plaintiff failed to file within 90 days of receiving notice of his termination, and the district court lacked subject-matter termination to hear the claim. In closing, the court clarified that "any subjective belief [of the plaintiff] that the layoff decision was not final is simply not relevant." Id. at 604 (citations omitted).

ADMINISTRATIVE REVIEW BOARD DECISIONS

TIMELINESS OF COMPLAINT; LETTER PLACING COMPLAINANT ON LEAVE OF ABSENCE BECAUSE OF LACK OF SUFFICIENT WORK DID NOT TRIGGER THE SOX LIMITATIONS PERIOD WHERE THE LETTER INDICATED AN ANTICIPATED DATE FOR RETURN TO WORK, EVEN THOUGH IT ALSO STATED THAT REINSTATEMENT COULD NOT BE GUARANTEED

In Poli v. Jacobs Engineering Group, Inc. , ARB No. 11-051, ALJ No. 2011-SOX-27 (ARB Aug. 31, 2012), the ALJ found that the Complainant's SOX whistleblower complaint had not been filed within the applicable limitations period following the Respondent's letter to the Complainant informing him that he had been placed on "Company Convenience Leave (CCL)." The ARB found that the ALJ's finding was incorrect as a matter of law.

CCL was a company procedure to allow a leave of absence for eligible employees temporarily without billable hours. The company policy (which was stated in the letter to the Complainant) was that reasonable efforts would be made to return the employee to the same position if it is available or to a similar available position. The ALJ, analyzing the case under English v. Whitfield , 858 F.2d 957 (4th Cir. 1998), and Rollins v. American Airlines , ARB No. 04-140, ALJ No 2004-AIR-9 (ARB Apr. 3, 2007), concluded that the CCL letter was final and unequivocal notice that if no position was identified within the CCL period, the Complainant would be terminated.

The ARB cited caselaw that acknowledges that employment terminations present widely varying circumstances and the application of general principles for determining the trigger date of a limitations period must necessarily be made on a case-by-case basis. The ARB found that the English and Rollins cases were factually distinguishable. The ARB stated that "[u]nlike in English and Rollins , [the Complainant] received a letter that was described in the company policy as being based on the lack of billable work, and was not due to disciplinary action." USDOL/OALJ Reporter at 6. The ARB noted that the original letter and a revised letter both indicated an anticipated return-to-work date. Moreover, the original letter explained the continued receipt of benefits, allowed for a request for advanced paid time-off, and stated that every reasonable effort would be made to return the Complainant to the same position he held before the leave of absence. The ARB acknowledged that the letter stated that the company could not guarantee reinstatement in all cases, but found that "this does not imbue the letter with the same degree of finality evidenced in English and Rollins ." USDOL/OALJ Reporter at 6-7. The ARB concluded that the CCL letter was insufficient to begin the statute of limitations period, and found instead that the limitations period began on the date that the Complainant received unequivocal notice of his termination from employment. Because the complaint was filed within the limitations period of the termination notice, the ARB found that the complaint was timely, and remanded for further proceedings before the ALJ.

TIMELINESS OF COMPLAINT; TRIGGER DATE FOR LIMITATIONS PERIOD; DETERMINATION OF WHETHER NOTICE OF TERMINATION WAS FINAL, DEFINITIVE AND UNEQUIVOCAL SHOULD INCLUDE CONSISDERATION OF THE PRE- AND POST-NOTICE CONTEXT AND WHETHER THAT CONTEXT SUGGESTED A POSSIBILITY THAT THE TERMINATION MAY NOT OCCUR

In Avlon v. American Express Co. , ARB No. 09-089, ALJ No. 2008-SOX-51 (ARB May 31, 2011), the Complainant was on paid administrative leave during an investigation of complaints she had made against her supervisor. The ARB held that an email from the Respondent's HR representative to the Complainant stipulating conditions for the Complainant's return to work -- (1) scheduling and attending a meeting with HR personnel no later than the following week and (2) returning to the same position and office but reporting to a different supervisor -- and stating that if the Complainant did not meet these conditions, she would be terminated -- was not final, definitive and unequivocal notice of her termination triggering the limitations period for filing a SOX complaint. The ARB made this determination based on the context in which the email was sent. The previous day the Complainant had sent an email explaining that she would just be returning from a vacation and would have only two days to meet, and that she did not want to meet until she had secured legal counsel. Ultimately, the Complainant did not meet with the HR personnel, but was not terminated. Instead, she secured legal counsel who engaged in discussions with the Respondent's counsel over some period of time. The ARB found, therefore, that because there had been discussions after the date of the email regarding the Complainant's employment status, the purported termination notice had not been final and definitive. Moreover, the Respondent continued discussions directly with the Complainant after her legal counsel stopped representing her in the matter. The ARB found that these discussions "undoubtedly extended the possibility that she would not be terminated, and that her employment [with the Respondent] would continue in some fashion."

In contrast, the ARB held that a later email from the Respondent's counsel to the Complainant in which the Complainant was finally, definitively and unequivocally told that she needed either to return to work at her old office or enter into an separation agreement, triggered the limitations period. The complaint was timely when the limitations period was calculated based on this later email.

TRIGGER DATE FOR LIMITATIONS PERIOD; FINAL, DEFINITE AND UNEQUIVOCAL NOTICE; DISTINCTION BETWEEN "COLLATERAL" PROCEDURE SUCH AS ARBITRATION OR GRIEVANCE PROCEDURE, AND LESS FORMAL LETTER FROM EMPLOYER HOLDING OUT OPPORTUNITY FOR REVIEW OF DECISION

In Snyder v. Wyeth Pharmaceuticals , ARB No. 09-008, ALJ No. 2008-SOX-55 (ARB Apr. 30, 2009), the Complainant had been suspended with pay pending an investigation into whether he had improperly accessed a confidential system. While suspended, the Complainant sent an e-mail to the Respondent alleging that company officials had committed Code of Conduct violations. The Director of HR responded in an October 2007 letter informing the Complainant that prior to receiving the e-mail, the company had decided to terminate the Complainant's employment, but also informing the Complainant that the HR Director would entertain evidence addressing the behavior which the company found objectionable or information as to why the Complainant thought the termination was not justified. The Complainant responded. Several months later, in February 2008, the Complainant was informed that an investigation had not substantiated his claims, and that the decision to terminate would stand. The Complainant's suspension was converted to a discharge. The Complainant then filed SOX whistleblower complaint. The complaint was timely if the limitations period began in February 2008, but not if it began on the date of the October 2007 letter. The ALJ found that the willingness of the company to review the discharge decision was similar to an arbitration or grievance procedure, which under Delaware State Coll. v. Ricks , 449 U.S. 250 (1980), did not stay the limitations period. The ARB disagreed.

The ARB found that Ricks was premised on "collateral" review of an employment decision, and that the HR Director's letter "carried none of the indicia of a formal collateral procedure to remedy a final decision. Instead, it injected an element of ambiguity into the transaction and an opportunity for further action, discussion, or change. Thus, the letter did not constitute final, definitive, and unequivocal notice of the termination of Snyder's employment sufficient to commence the running of the limitations period." USDOL/OALJ Reporter at 8. The ARB found this interpretation of Ricks was consistent with the Fourth Circuit's decision in English v. Whitfield , 858 F.2d 957 (1998), and distinguishable from or consistent with several of the ARB's own decisions.

TIMELINESS OF COMPLAINT; LIMITATIONS PERIOD BEGINS WHEN EMPLOYEE RECEIVED FINAL, DEFINITIVE AND UNEQUIVOCAL NOTICE OF DISCHARGE OR OTHER DISCRIMINATORY ACT

The limitations period for filing a SOX whistleblower complaint under § 1514A(b)(2)(D) runs from the date an employee receives "final, definitive, and unequivocal notice" of a discharge or other discriminatory act. " The date that an employer communicates to the employee its intent to implement the discharge or other discriminatory act marks the occurrence of a violation, rather than the date the employee experiences the consequences." Corbett v. Energy East Corp. , ARB No. 07-044, ALJ No. 2006-SOX-65, USDOL/OALJ Reporter at 4 (ARB Dec. 31, 2008) (citations omitted).

TIMELINESS OF COMPLAINT; NOTICE OF ADVERSE ACTION IS BASED ON OBJECTIVE, NOT SUBJECTIVE STANDARD; SUPREME COURT DECISIONS DO NOT REQUIRE THAT A DATE CERTAIN BE GIVEN IN THE NOTICE

In Sneed v. Radio One, Inc. , ARB No. 07-072, ALJ No. 2007-SOX-18 (ARB Aug. 28, 2008), in opposing a motion for summary decision grounded in lack of timeliness of the SOX whistleblower complaint, it was not sufficient for the Complainant to merely show that there was a genuine issue of material fact as to whether she had a subjective belief that the notice she had received constituted a "final, definitive, and unequivocal notice" that the termination of her employment would be effective the following day. Rather, the ARB indicated that the ALJ correctly looked to whether such a belief was objectively reasonable. The ARB found that the notice she had been given in an e-mail that "tomorrow will be your last day," and that the separation would be announced to the company, was sufficient for a reasonably prudent person with regard for her rights to know that it was her employer's intent to take adverse action against her the following day. Moreover, even if the adverse action was not certain to occur the following day, the Complainant knew or should have known that her termination "was not in question and was imminent." The complaint had been filed on the 91st day following the e-mail that the ALJ and ARB found constituted notice of the adverse action.

The Complainant argued that under Chardon and Ricks , the employer is required not only to unequivocally notify the employee of the termination, but also to give a date certain for that termination to activate the limitations clock. The ARB held that these decisions did not stand for the proposition that such a definite date is a prerequisite to starting the limitations period, and that any such proposition would conflict with decisions of the 11th Circuit, in which circuit the case arose, the of the Board itself.

TIMELINESS OF COMPLAINT; DATE COMPLAINANT WAS PRESENTED WITH "CAREER DECISION DATE" CHOICES RATHER THAN LATER DATE OF TERMINATION IS DATE THAT LIMITATIONS PERIOD BEGINS

In Rollins v. American Airlines, Inc. , ARB No. 04-140, ALJ No. 2004-AIR-9 (ARB Apr. 3, 2007), a whistleblower complaint arising under both AIR21 and SOX, the Respondent issued to the Complainant a "Career Decision Day Advisory Letter" providing three choices: (1) commit to comply with the Respondent's rules and regulations (including satisfactory work performance and personal conduct) and accept reassignment, (2) voluntarily resign with transitional benefits and agree not to file a grievance, or (3) accept termination with grievance options. Five days later the Complainant informed the Respondent that he would not agree to any of the options, and on that same day the Complainant was provided a letter of termination. The whistleblower complaint would be timely if measured from the date of the termination letter, but untimely if measured from the date of the advisory letter. The ARB found that advisory letter provided final and unequivocal notice to the Complainant that the Respondent had decided to terminate his employment. The ARB observed that under English v. Whitfield , 858 F.2d 957, 962 (4th Cir. 1988), rev'd on other grounds , 496 U.S. 72 (1990) and Wagerle v. The Hosp. of the Univ. of Pa. , 1993-ERA-1, slip op. at 3-6 (Sec'y Mar. 17, 1995), the possibility that the Complainant could have avoided the effects of the advisory letter by resigning voluntarily or accepting employment in another division did not negate the effect of the advisory letter's notification of intent to terminate the Complainant's employment. Thus, the complaint was untimely.

TIMELINESS OF COMPLAINT; TRIGGER DATE OF LIMITATIONS PERIOD; EQUITABLE TOLLING; EQUITABLE ESTOPPEL

The ARB affirmed the ALJ's finding that the Complainant knew on the date of his suspension that he was going to be fired. The record, however, also contained an e-mail dated several weeks later to the Complainant from the General Counsel for the Respondent's parent company which suggested that a final decision had not been made on the Complainant's employment status. The ARB, therefore, found that the date that limitations period began to run was the date on which the Complainant was later informed verbally and in writing that he had been fired. Nonetheless, even using that later date the complaint was still untimely.

The Complainant alleged that he was entitled to equitable tolling because, among other reasons, he was unaware of the Respondent's unlawful motivation for his termination until within the limitations period. The Board rejected this argument, writing:

Neither the statute nor its implementing regulations indicate that a complainant must acquire evidence of retaliatory motive before proceeding with a complaint. Halpern's failure to acquire evidence of XL's motivation for his suspension and firing did not affect his rights or responsibilities for initiating a complaint pursuant to the SOX. See Wastak v. Lehigh Valley Health Network , 333 F.3d 120, 126 (3d Cir. 2003), citing Oshiver v. Levin, Fishbein, Sedran & Berman , 38 F.3d 1380, 1386 (3d Cir. 1994) ("a claim accrues in a federal cause of action upon awareness of actual injury, not upon awareness that this injury constitutes a legal wrong."). We therefore conclude that Halpern's failure to acquire such evidence does not constitute an extraordinary circumstance warranting tolling of the limitations period.

The Board also rejected the Complainant's argument that he was entitled to equitable estoppel based on the assertion that the Respondent misled him into believing that he would not be fired. The Board found no evidence that the Respondent misled the Complainant regarding his termination. Halpern v. XL Capital, Ltd. , ARB No. 04-120, ALJ No. 2004-SOX-54 (ARB Aug. 31, 2005).

ADMINISTRATIVE LAW JUDGE DECISIONS

TIMELINESS OF COMPLAINT; UNEQUIVOCAL VERBAL NOTICE OF TERMINATION

In Salian v. Reedhycalog UK , 2007-SOX-20 (ALJ May 11, 2007), the ALJ granted summary decision against the Complainant where the Respondent asserted that the Complainant was informed of the decision to terminate him more than 90 days before the SOX complaint was filed, and the Complainant's only response was to contend that the limitations period did not start to run until the date that his termination became effective. The Complainant argued that the notice of termination had not been given to him in writing. The ALJ, however, found that the law does not require that a notice of termination be given in writing, and that since the Respondent had given the Complainant an unequivocal verbal notice of termination, the Complainant had adequate notice to trigger the running of the statute of limitations.

TIMELINESS OF COMPLAINT; UNEQUIVOCAL NOTICE OF TERMINATION; OBJECTIVE ASSESSMENT OF COMMUNICATION RATHER THAN COMPLAINANT'S SUBJECTIVE ASSESSMENT GOVERNS

In Sneed v. Radio One, Inc. , 2007-SOX-18 (ALJ Apr. 16, 2007), the Respondent filed a motion for summary decision based on the complaint being not timely filed. The Respondent asserted that the adverse action triggering the limitations period was June 29, 2006, while the Complainant asserted that she did not receive unequivocal notice that she would be fired until June 30, 2006. If the notice was received on the earlier date, the complaint was untimely. The ALJ acknowledged that the Complainant may have been able to establish a genuine issue of fact as to whether she subjectively comprehended that the communications between her and the Respondent constituted a final, definitive and unequivocal notice of termination. However, the record contained e-mails dated June 29, 2006 that the ALJ found led to no reasonable objective conclusion other than the Complainant would be terminated on June 30, 2006. Although there may have been subjective confusion on the Complainant's part because of the negotiation of the terms of a severance package and the timing of public announcements, those negotiations did not relate to whether the Complainant would continue to be employed by the Respondent after June 30, 2006. The ALJ rejected the Complainant's argument that the clock should not have started because the termination notice did not state a date certain for termination, because "such a certain date is not required, as long as notice of an unequivocal decision to terminate was communicated." Slip op. at 5.

TIMELINESS OF COMPLAINT; LIMITATIONS PERIOD BEGINS UPON NOTICE OF ADVERSE ACTION, NOT UPON LEARNING OF THE MOTIVATION FOR THE ADVERSE ACTION

In Coppinger-Martin v. Nordstrom, Inc. , 2007-SOX-19 (ALJ Apr. 4, 2007), the Complainant alleged that she believed that her position was being eliminated for budgetary reasons, and did not suspect that the Respondent's stated reasons for eliminating her position were untrue until she later learned from another employee that many of her job functions had been transferred to other employees. The Complainant argued that she did not have a basis for filing a SOX complaint until obtaining this information, and therefore the limitations period should run from that date rather than the date that she learned that she would be terminated or the date that she was actually terminated. The ALJ held that the ARB holding in Halpern v. XL Capital Ltd. , 2004-SOX-54 (ARB Aug. 31, 2005), precluded application of equitable tolling or equitable estoppel in this case. The ALJ observed that in Halpern , the ARB held that "'[n]either [SOX] nor its implementing regulations indicate that a complainant must acquire evidence of retaliatory motive before proceeding with a complaint.'" The complainant's failure to acquire evidence of the employer's motivation for terminating him 'did not affect his rights or responsibilities for initiating a complaint pursuant to the SOX.'" Slip op. at 5, quoting Halpern (citations omitted). The ALJ held that "Complainant was required to file her claim within 90 days of receiving "final, definitive, and unequivocal notice" of her termination, regardless of whether she suspected that Respondent's stated reasons were pretextual, had evidence of Respondent's notice, or was aware that her termination constituted a legal wrong." Id .

TIMELINESS OF COMPLAINT; FINAL, DEFINITE AND UNEQUIVOCAL NOTICE; OFFER OF SEVERANCE

In Rzepiennik v. Archstone Smith, Inc. , 2004-SOX-26 (ALJ Feb. 23, 2007), the ALJ found that a gag provision in a proposed severance agreement was not adverse employment action; however, assuming arguendo that it was, the complaint's timeliness was dependent on whether the limitations period commenced when the offer was made or when it expired. The Complainant argued that the offer itself did not create a tangible job consequence, whereas its expiration did. The ALJ observed that the Complainant had cited no authority that actually made this distinction, and rejected the argument. The Complainant argued that he was not given sufficient notice of an adverse action based on the contention that the severance agreement contained "legalese" and was subject to interpretation, and therefore was not final, definite and unequivocal. The ALJ rejected this contention, observing that it was not clear why the Complainant would not realize that an adverse action had occurred upon the offer with legalese, but be able to recognize such upon the offer's expiration. The ALJ also found that the offer was definite and unequivocal, that there was no allegation that the status of the offer was in doubt, nor had there been continuing negotiations over the offer. Finally, the Complainant argued that the Respondent's offer conflicted with the ADEA on the theory that it would contravene the purpose of the ADEA to count the required 21 day period for considering whether to waive an ADEA complaint against the limitations period in other federal administrative statutes, citing authority Title VII and ADA authority in which the court had invalidated severance agreements which would require an employee to file a discrimination suite before exhausting administrative remedies before the EEOC. The ALJ rejected this argument because the issue before her was not whether the severance agreement was valid, but whether the SOX limitations period had expired.

TIMELINESS OF FILING OF COMPLAINT; LIMITATIONS PERIOD BEGINS TO RUN WHEN THE COMPLAINT IS MADE AWARE OF DECISION TO TERMINATE HIS EMPLOYMENT RATHER THAN WHEN DISCUSSIONS ABOUT SEVERENCE COMPENSATION ARE CONCLUDED

In Carter v. Champion Bus, Inc. , 2005-SOX-23 (ALJ Mar. 17, 2004), the ALJ held that the limitations period for filing a SOX complaint began to run when the Complainant was made aware of the decision to terminate him and not when talks about severance compensation ended or when the consequences of the adverse employment action became most painful. Because the complaint was filed untimely and there were no mitigating circumstances, the ALJ dismissed the complaint.

TIMELINESS OF COMPLAINT; DATE EMPLOYEE MADE AWARE OF DECISION TO TERMINATE IS TRIGGER DATE EVEN IF POSSIBLE THAT TERMINATION COULD BE AVOIDED

In Lawrence v. AT&T Labs , 2004-SOX-65 (ALJ Sept. 9, 2004), the ALJ found that the Complainant's SOX complaint was not timely filed. The Complainant had received a letter informing her that she had been selected for involuntary termination unless she was placed in another position with the Respondent by a date certain. Although additional correspondence subsequently followed between the Complainant or her attorney and the Respondent, the ALJ found that nothing happened after the original letter that would have been a reasonable basis for the Complainant to believe that the Respondent had withdrawn or altered its determination to discharge her. The ALJ wrote:

The fact that Complainant could have avoided termination if she found another job with Respondent does not prevent the statute of limitations from running. The statute of limitations begins to run when the employee is made aware of the employer's decision to terminate him or her even when there is a possibility that the termination could be avoided. English v. Whitfield , 858 F.2d 957 (4th Cir. 1988); Electrical Workers v. Robbins & Myers, Inc. , 429 U.S. 229 (1976) (cited by Ricks , 449 U.S. at 261).

TIME LIMITATION FOR FILING OF COMPLAINT; COMMENCES WHEN EMPLOYEE MADE AWARE OF DECISION TO TERMINATE, EVEN IF POSSIBILITY REMAINS THAT TERMINATION COULD BE AVOIDED

"The statute of limitations begins to run when the employee is made aware of the employer's decision to terminate him or her even when there is a possibility that the termination could be avoided. English v. Whitfield , 858 F.2d 957 (4th Cir. 1988); Electrical Workers v. Robbins & Myers, Inc. , 429 U.S. 229 (1976) (cited by Ricks , 449 U.S. at 261)." Lawrence v. AT&T Labs , 2004-SOX-65 (ALJ Sept. 9, 2004).

TIMELINESS OF COMPLAINT; DATE OF NOTICE OF DISCRIMINATORY DECISION COMMENCES TIME PERIOD FOR FILING COMPLAINT

In Flood v. Cedant Corp. , 2004-SOX-16 (ALJ Feb. 23, 2004), the Complainant was notified by e-mail on June 12, 2003 that unless he found alternative employment with Respondent's business by June 23, 2003, his employment would be terminated on June 26, 2003. The Complainant replied to the e-mail. The notification was also sent to the Complainant by overnight delivery service. Before the ALJ, the Complainant contended that the time period for filing a SOX complaint commenced on June 26, 2003,the date of his termination; the Respondent contended that the time period commenced on June 12, 2003. The ALJ, applying 29 C.F.R. § 1980.103(d), found that the period commenced when the Complainant received notice. The ALJ cited Watson v. Eastman Kodak Co ., 235 F.3d 851 (3d Cir. 2000).

TIMELINESS OF COMPLAINT; EVENT TENDING TO SHOW LINK BETWEEN PROTECTED ACTIVITY AND TERMINATION DID NOT EXTEND FILING PERIOD WHERE IT WAS NOT CREDIBLE TO BELIEVE THAT THE COMPLAINANT DID NOT ALREADY KNOW THAT THERE WAS A LINK

In Roulett v. American Capital Access , 2004-SOX-78 (ALJ Dec. 22, 2004), the Complainant argued that the time period for filing his SOX whistleblower complaint did not commence until the date that the Respondent filed for registration with the SEC, contending that it was not until that event that he realized that he had been terminated as part of a "housecleaning" effort so that the Respondent's IPO would not be jeopardized by employees with familiarity with alleged improper acts. The ALJ found that the registration may support the Complainant's belief that he was terminated for protected activity. The Complainant nonetheless had repeatedly advised the Respondent of his belief that certain of its practices were improper, if not illegal, and had not been given a reason for his termination. In view of that, the ALJ found it unreasonable to accept that it was the registration that triggered the Complainant's knowledge of the association between the protected activity and his termination.

Private Tolling Agreement

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ADMINISTRATIVE LAW JUDGE DECISIONS

TIMELINESS OF COMPLAINT; ALJ DECLINES TO HONOR PARTIES' PRIVATE TOLLING AGREEMENT

In Szymonik v. Tymetrix, Inc. , 2006-SOX-50 (ALJ Mar. 8, 2006), the Complainant and the Respondent had entered into an agreement during settlement negotiations in which the Respondent agreed that it would not assert any statute of limitations defenses based on the Complainant's failure to assert a timely claim, to the extent that any delay resulted from the settlement negotiations. The Complainant later filed a SOX whistleblower complaint. OSHA found that it was untimely. The presiding ALJ ordered briefing on the threshold issue of timeliness. The Complainant argued that he was entitled to equitable tolling and equitable estoppel based on the tolling agreement. The Respondent did not take a position on timeliness, but argued that it was not a covered employer under SOX. The ALJ, noting that equitable tolling extends a statute of limitations until a complainant can gather information needed to articulate a claim, found that none of the usual bases for tolling applied. Noting that equitable estoppel focuses on actions taken by a respondent that prevent a complainant from filing a claim, the ALJ found that in the present case there was no indication that the Respondent attempted to lull the Complainant into inaction. The ALJ also noted public policy concerns. The ALJ wrote:

When the United States Congress passed the Sarbanes Oxley Act, its explicit intent was for a 90-day statute of limitations for whistleblower claims. 18 U.S.C. § 1514A(b)(2)(D); 29 C.F.R. § 1980.103(d). There is no suggestion in the language of the Act that Congress intended for private parties to enter into private, legally binding agreements to toll the statute of limitations. The purpose of the Act is "to protect investors by improving the accuracy and reliability of corporate disclosures made pursuant to the securities laws, and for other purposes." Sarbanes-Oxley Act of 2002, Pub. L. No. 107-204, 116 Stat 745. To allow private parties to contract at will out of the 90-day limitation would effectively thwart the explicit legislative intent of Congress regarding the applicable statute of limitations.

Slip op. at 5.

Post-termination Events

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FEDERAL COURT DECISIONS

TIMELINESS OF COMPLAINT; ALTHOUGH THE PLAINTIFF'S COMPLAINT WAS UNTIMELY IN REGARD TO NOTICE OF HIS REMOVAL, THE COMPLAINT WAS TIMELY AS TO ADDITIONAL ACTIONS ALLEGEDLY CONSTITUTING ADVERSE EMPLOYMENT ACTION THAT OCCURRED ON OR AFTER THE DATE OF REMOVAL

In McClendon v. Hewlett-Packard Co. , 2004 WL 1421395 (D.Idaho June 9, 2005) (case below ALJ No. 2005-SOX-3), the district court granted the Defendant's motion for summary judgment in regard to the lack of timeliness of the Plaintiff's administrative complaint under the SOX whistleblower provision insofar as the Plaintiff had not filed a complaint within 90 days of the date that he was informed that he would be removed as a project manager. The district court, however, found that under the 9th Circuit's expansive definition of what constitutes an adverse employment action, summary judgment could not be granted as to the timeliness of potentially separate and discrete adverse actions that occurred on or after the date the Complainant was actually removed as project manager: not being immediately reassigned another job; being left to sit in a conference room without an assignment; not being placed in a different job until several months later; and ultimate assignment to a job with a reduced pay range. The court made it clear that it was only ruling that the complaint was timely filed, and not associated issues such as whether these claims were actually included in the administrative complaint, whether they actually constituted adverse employment action, and whether the Plaintiff exhausted his administrative remedies.

ADMINISTRATIVE LAW JUDGE DECISIONS

TIMELINESS OF COMPLAINT; WHERE COMPLAINANT FAILED TO TIMELY FILE SOX COMPLAINT MEASURED FROM DATE OF NOTICE OF TERMINATION, PHONE CALL FROM H.R. DEPARTMENT TO INQUIRE WHETHER COMPLAINANT WOULD BE SIGNING A RELEASE/SEVERANCE FORM IS NOT A NEW ADVERSE ACTION

In Richardson v. JPMorgan Chase & Co. , 2006-SOX-82 (ALJ July 7, 2006), the Complainant failed to file her SOX complaint within 90 days of notice of her termination. The only act by the Respondent within the 90 day limits period was a telephone call from a HR liaison inquiring into whether or not the Complainant would be signing a "Release Severance" form. The ALJ found that this phone call did not rise to the level of an adverse employment action; the Complainant was already fully aware that her termination was inevitable or, indeed, had already occurred.

Hostile Work Environment

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ADMINISTRATIVE LAW JUDGE DECISIONS

TIMELINESS OF COMPLAINT; HOSTILE WORK ENVIRONMENT; AT LEAST ONE ACT MUST HAVE OCCURRED WITHIN 90-DAY LIMITATIONS PERIOD

In Grove v. EMC Corp. , 2006-SOX-99 (ALJ July 2, 20007), the Complainant argued in a pre-trial conference that retaliatory conduct that occurred more than 90 days before the filing of his SOX complaint with OSHA were part of a "hostile work environment" and therefore would be actionable. The ALJ permitted the Complainant to amend his complaint accordingly, citing authority to the effect that an ALJ has some responsibility to assist a pro se litigant in clarifying pleadings. The ALJ found that allegations, such as non-payment of a commission and reassignment of accounts, were discrete adverse actions that were not actionable because they occurred outside the 90-day limitations period. He found that some other actions were not the type of discrete actions that would have been individually actionable and therefore subject to the 90-day limitations period; however, the only act that occurred within the 90-day limitations period was the Complainant's termination - which was a separate and discrete adverse employment action, and therefore not part of the same unlawful employment practice as the other actions that allegedly created a hostile work environment. The ALJ, therefore, found the hostile work environment claim was time-barred.

Amendment of Complaint

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ADMINISTRATIVE REVIEW BOARD JUDGE DECISIONS

UNTIMELY AMENDMENT OF COMPLAINT; RELATION BACK CRITERIA FOR AMENDMENT OF COMPLAINT IS NOT MET WHERE § 11(c) COMPLAINT BEFORE OSHA FOCUSED EXCLUSIVELY ON WORK SAFETY ISSUES AND NOT MISCONDUCT COVERED UNDER SOX, 18 U.S.C.A. § 1514A

In Brown v. Teamstaff Government Solution , ARB No. 13-008, ALJ No. 2012-SOX-31 (ARB June 27, 2014), the Complainant filed an OSHA § 11(c) complaint on December 1, 2011, the subject of which was complaints to management about exposure to prescription drugs at a Consolidated Mail Outpatient Pharmacy. On June 11, 2012, the Complainant sent a letter to OSHA informing that she was "amending" her OSH Act complaint to add a SOX claim alleging that the Respondent repeatedly under-reported or completely failed to report workplace injuries and illnesses in order to contain worker's compensation premiums and healthcare costs. OSHA dismissed the OSH Act complaint on the merits and the SOX complaint on the ground that it was not timely. The Complainant requested an ALJ hearing. The ALJ issued an order to show cause why the SOX complaint should not be dismissed as untimely. The Complainant raised "relation back" and "equitable modification" arguments. The ALJ rejected those arguments and dismissed the SOX complaint as untimely. The ALJ noted the relationship between ALJ Rule 18.5(e) (amendments and supplement pleadings) and FRCP 15 (relation back of amendments), and concluded that the amended complaint did not satisfy the relation back criteria. The ARB affirmed because "the SOX claim alleged in [the Complainant's] June 11, 2012 amended complaint did not reasonably fall within the scope of the facts asserted in the original complaint she filed with OSHA on December 1, 2011." The ARB wrote

    Before filing a complaint with OALJ, the SOX regulations require a complainant to file a complaint with OSHA and wait for OSHA to investigate the complaint if it meets the regulatory requirements to justify an investigation. The facts asserted in the December 1, 2011 complaint did not alert OSHA of a SOX complaint because the first complaint focused exclusively on work safety issues, not on any misconduct connected to mail fraud; wire, radio, or TV fraud; bank fraud; fraud upon shareholders; or a violation of a securities law. Brown did not present a timely SOX complaint to OSHA to investigate and neither 29 C.F.R. § 18.5 nor Fed. R. Civ. P. 15 permits her to file such a complaint with the OALJ in this case. We also agree with the ALJ that Brown failed to raise sufficient grounds to equitably toll the running of the 180-day statute of limitations.

USDOL/OALJ Reporter at 6 (footnotes omitted).

ADMINISTRATIVE LAW JUDGE DECISIONS

TIMELINESS OF COMPLAINT; ALJ DECLINES TO AMEND COMPLAINT TO INCLUDE NEW ALLEGATIONS OF DRASTICALLY DIFFERENT TYPE FROM THAT ALLEGED IN THE ORIGINAL, UNTIMELY FILED, COMPLAINT

In Kingoff v. Maxim Group LLC , 2004-SOX-57 (ALJ July 21, 2004), the ALJ found that the Complainant's constructive discharge complaint was clearly untimely under the SOX whistleblower provision. In an effort to render the action timely, the Complainant made allegations subsequent to his original complaint that the Respondent committed other acts against him that adversely affected his employment (forcing him to execute a promissory note, filing a NASD claim against him for arbitration, sending allegedly threatening or harassing correspondence, and other unspecified acts). The ALJ, however, concluded that the later allegations were of a drastically different type from those contained in the complaint before him, and could not -- consistent with due process -- be considered in the matter before the ALJ, citing Sasse v. Office of the U.S. Attorney, USDOJ , ARB No. 02-077, ALJ No. 1998-CAA-7 (ARB Jan. 30, 2004). The ALJ, however, forwarded to OSHA copies of the Complainant's letters containing his additional allegations of violations by the Respondent with a suggestion that OSHA should process those letters as SOX complaints.

ALJ's Authority to Raise Issue in Order to Show Cause

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ADMINISTRATIVE REVIEW BOARD DECISIONS

TIMELINESS OF COMPLAINT; ALJ HAS THE DISCRETION TO USE AN ORDER TO SHOW CAUSE TO RESOLVE THE ISSUE

An ALJ has the discretion to use an Order to Show Cause procedure to resolve the issue of whether the Complainant had filed a timely complaint. See Harvey v. Home Depot U.S.A., Inc. , ARB Nos. 04-114 and 115, ALJ Nos. 2004-SOX-20 and 36 (ARB June 2, 2006).

Equitable Tolling

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FEDERAL COURT DECISIONS

COURT OF APPEALS FINDS THAT ARB PROPERLY DISMISSED COMPLAINT UNDER SOX AS UNTIMELY; EQUITABLE TOLLING AND EQUITABLE ESTOPPEL DID NOT APPLY; SUFFICIENT INFORMATION TO MAKE A PRIMA FACIE CASE; FRAUDULENT CONCEALMENT MUST INVOLVE CONDUCT ABOVE AND BEYOND WRONG UPON WHICH CLAIM IS FILED

In Coppinger-Martin v. Solis, Sec. of U.S. Dep't of Labor , No. 09-73725 (9th Cir. Nov. 30, 2010)(case below ARB No. 07-067, ALJ No. 2007-SOX-19), the plaintiff sued her former employer for allegedly violating the whistleblower-protection provisions under SOX. The plaintiff alleged that her former employer terminated her employment in retaliation for her reporting to supervisors conduct she believed violated the rules and regulations of the SEC. The employer asserted that she was terminated because her job duties were eliminated and there were no other opportunities for her in the company. The ALJ dismissed the plaintiff's complaint as untimely filed and the ARB affirmed. The Court of Appeals concluded that the ARB properly dismissed the plaintiff's complaint as untimely and denied the petition for review.

The Court of Appeals found that the plaintiff's claim accrued, and the statute of limitations began to run, when she learned of the actual injury, i.e. that her employer had decided to terminate her employment. The plaintiff filed her complaint more than 90 days after her final day of work, therefore, unless the date of accrual was tolled, her complaint was untimely filed. The plaintiff argued that equitable tolling should extend the filing period because she was not aware of her employer's retaliatory motives until three months after her termination date, when she learned that other employees were performing many of her former job duties.

Equitable tolling may be applied if, despite all due diligence, a plaintiff is unable to obtain vital information bearing on the existence of his claim. If a reasonable plaintiff would not have knowing of the existence of a possible claim within the limitations period, then equitable tolling will serve to extend the statute of limitations for filing suit until the plaintiff can gather what information he needs.

Coppinger-Martin at 3. The Court of Appeals found that the plaintiff's equitable tolling argument failed for two reasons. First, she retained counsel a month after she was terminated at which time she was "charged with constructive knowledge of the law's requirements." Id . Second, under the burden-shifting framework of the SOX whistleblower-protection provision, the plaintiff had sufficient information to make a prima facie case on the date the decision to terminate her employment had unquestionably been made and communicated to her.

The plaintiff asserted that equitable estoppel should have prevented her former employer from asserting a statute of limitation defense because the company fraudulently concealed its motive in terminating her employment. The Court of Appeals rejected this argument, stating that "the plaintiff must point to some fraudulent concealment, some active conduct by the defendant ' above and beyond the wrong upon which the plaintiff's claim is filed, to prevent the plaintiff from suing on time.'" Coppinger-Martin at 4. The court found that the plaintiff's attempt to invoke equitable estoppel merged the substantive wrong with the tolling doctrine.

ADMINISTRATIVE REVIEW BOARD DECISIONS

TIMELINESS OF COMPLAINT; NO EQUITABLE TOLLING UNDER THE FACTS OF THE CASE BASED ON ALLEGED MISHANDLING OF CASE BY FORMER ATTORNEY OR ALLEGED MANIPULATION BY RESPONDENT'S COUNSEL DURING SETTLEMENT NEGOTIATIONS

In DeFazio v. Sheraton Steamboat Resorts & Villas , ARB No. 11-063, ALJ No. 2011-SOX-35 (ARB Oct. 23, 2012), the ARB affirmed the ALJ's dismissal of the Complainant's SOX complaint as untimely and as not entitled to equitable relief from the limitations period. The Complainant argued that his former attorney mishandled the case, and that the attorney representing the Respondent manipulated the Complainant's rights by proposing to provide a response to the Complainant's counsel's demand letter by the same date that the SOX limitations period would end. The ARB found that the record supported the ALJ's finding, however, that there had been no active misleading of the Complainant by the Respondent or its counsel during settlement negotiations with regard to the filing of the SOX complaint.

EQUITABLE TOLLING FOUND NOT TO BE WARRANTED WHERE THE COMPLAINANT'S FAILURE TO FILE HIS SOX COMPLAINT TIMELY WAS ATTRIBUTABLE TO HIS MISUNDERSTANDING OF WHEN THE CLAIM ACCRUED RATHER THAN HIS MEDICAL CONDITION

In Reid v. The Boeing Co. , ARB No. 10-110, ALJ No. 2009-SOX-27 (ARB Mar. 30, 2012), the ARB affirmed the ALJ's findings that the Complainant's SOX complaint was not timely and that sufficient grounds for equitable tolling was not established. The Complainant presented his treating psychologist's opinion that his medical condition prevented the timely filing of the SOX complaint. The ARB found that the ALJ ultimately concluded that it was the mistaken understanding of the law rather than the medical condition that caused the untimely filing. Specifically, both the Complainant and his wife testified that they believed that the Complainant did not have a SOX whistleblower claim unless and until the Respondent fired him. The ARB noted that ignorance of the law is generally not a factor warranting equitable modification.

TIMELINESS; EQUITABLE TOLLING BASED ON FILING OF PRECISE CLAIM IN WRONG FORUM; WRONG FORUM FILING NEED NOT ESTABLISH PRIMA FACIE CASE FOR PURPOSES OF DETERMINING WHETHER TIMELY COMPLAINT WAS FILED

TIMELINESS; EQUITABLE TOLLING BASED ON FILING OF PRECISE CLAIM IN WRONG FORUM; RESPONDENT MAY PRESENT EVIDENCE TO SUPPORT AN ARGUMENT THAT EQUITABLE TOLLING SHOULD NOT APPLY BECAUSE COMPLAINANT DID NOT FOLLOW OSHA'S ADVICE ABOUT HOW TO FILE A COMPLAINT

In Butler v. Anadarko Petroleum Corp. , ARB No. 09-047, ALJ No. 2009-SOX-1 (ARB Feb. 17, 2011), the Complainant contacted OSHA for guidance shortly after her termination by the Respondent. OSHA instructed her to go to its website to fill out a form. The Complainant found a form relating to physical injury on the job rather than circumstances associated with her dismissal, and thus did not file the form with OSHA. Later she presented a typed testimony of the events of her case to the FBI. Thereafter, she filed a complaint in federal district court alleging in part a violation of the SOX whistleblower provision. Later, after the SOX filing deadline, the Complainant presented to OSHA her filings with the FBI and district court. OSHA found that equitable tolling applied, but denied the complaint on the merits. A hearing was requested. The ALJ found that the complaint was not timely and that equitable tolling did not apply because the FBI filings and district court complaint did not contain valid SOX complaints.

The ARB agreed with the ALJ that the FBI filings did not present a precise SOX complaint sufficient to invoke equitable tolling under the wrong forum ground for equitable modification of a limitations period. Rather it was merely a timeline of the events surrounding the Complainant's grievance. The ARB, however, disagreed that the district court complaint was not the precise claim in the wrong forum. The ARB explained:

Essentially, the ALJ's ruling focused on whether Butler's federal court complaint sufficiently stated a prima facie SOX claim rather than whether it alleged enough to meet the time limitations bar in the SOX statute. The SOX regulations contemplate that OSHA may interview a complainant to supplement the complaint and then determine whether a prima facie claim exists. See 29 C.F.R. § 1980.104(b). Logically, then, a SOX complainant may satisfy the time limitation bar by filing an initial, written complaint that may fall short of a prima facie case but clearly identifies that it is a SOX claim. Therefore to the extent the ALJ's R. D. & O. may be interpreted as defining "precise" to require that the complaint filed in the wrong forum must establish a "prima face case," we reject it as being overly narrow and inconsistent with equitable tolling principles. When the claim is filed in the wrong forum, it should be measured against the same standards under which an OSHA complaint is measured for timeliness. Additionally, the wrongly filed claim must be the same claim as the OSHA complaint ultimately filed. If the ALJ was addressing the sufficiency of the allegations, the ALJ should have considered the facts contained in the record OSHA forwarded, given that OSHA supplements the facts in the original complaint and forwards the complaint and the Secretary's findings to the Office of Administrative Law Judges. 29 C.F.R. § 1980.104(b), 105(b). The only issue the ALJ addressed in this case was the time limitations issue.

USDOL/OALJ Reporter at 4-5. The ARB reviewed the district court complaint and found that it comported with the requirements of 29 C.F.R. § 1980.103(b) for purposes of tolling the statute's filing requirement. The Respondent, however, argued that equitable tolling should not apply because OSHA had directed the Complainant to the proper forum, but she declined that guidance. Based on the facts alleged, the ARB did not believe that equitable tolling was barred, but since the facts surrounding the original communication with OSHA were not presented or litigated before the ALJ, the ARB found only that the district court complaint was a valid SOX complaint for purposes of tolling, and stated that on remand the parties could further adjudicate equity issues based on newly discovered evidence not addressed in the ARB's order.

TIMELINESS OF COMPLAINT; EQUITABLE TOLLING; EEOC COMPLAINT; FAILURE OF ATTORNEY TO FILE SOX COMPLAINT; EEOC DOES NOT HAVE THE OBLIGATION TO INFORM COMPLAINANTS ABOUT SOX

In Jones v. First Horizon National Corp. , ARB No. 09-005, ALJ No. 2008-SOX-60 (ARB Sept. 30, 2010), the Complainant filed an EEOC complaint alleging sex and race discrimination and retaliation for filing Title VII suits. She filed a SOX complaint with OSHA over a year and a half after the Respondent terminated her employment, but argued that she was entitled to equitable tolling because she mentioned fraud in an exhibit appended to an EEOC complaint, and because she had been reasonably diligent in asking her former attorney to file a whistleblower complaint on several occasions and her new attorney filed within three months after joining her case. The ARB, however, agreed with the ALJ that the letter appended to the EEOC complaint had not alleged that the termination was related to any protected whistleblower activity, and that referencing concerns of potential corporate fraud in a letter appended to a complaint alleging sex and race discrimination did not constitute a precise statement of a SOX claim in another forum. The ARB also agreed with the ALJ that ignorance of the law was not a grounds for equitable modification in this case. The Complainant also argued that the EEOC had failed to instruct her how to file a SOX complaint, but the ARB found that in the absence of evidence that the EEOC or the Respondent "actively misled" her, equitable modification was inapplicable. The ARB stated that neither the EEOC nor the Respondent were obligated to inform the Complainant of Section 806 and its filing requirements.

TIMELINESS; EQUITABLE TOLLING UNDER WRONG FORUM FILING; TOLLING ONLY FOR THE PERIOD THE COMPLAINANT WAS UNAWARE THAT THE FILING WAS IN THE WRONG FORUM

In McCloskey v. Ameriquest Mortgage Co. , ARB No. 08-123, ALJ No. 2005-SOX-93 (ARB Aug. 31, 2010), the Complainant argued that his SOX whistleblower complaint should be equitably found timely on the ground that he timely filed a precise statutory claim in the wrong forum when he sent an e-mail to the SEC and a letter to a state banking authority. The ARB agreed with the ALJ, however, that these communications were not the precise statutory claim in issue filed in the wrong forum and thus do not justify equitable tolling of the SOX 90-day filing deadline. Moreover, the ARB held that even if equitable tolling applied, the SEC's reply had informed the Complainant of the short filing deadlines for SOX whistleblower complaints, but the Complainant had still not acted promptly to file with OSHA. The ARB cited Hillis v. Knochel Bros. Inc. , ARB Nos. 03-136, 04-081, -148, ALJ No. 2002-STA-50, slip op. at 8-9 (ARB Mar. 31, 2006) (noting that the tolling of the statute's deadline was only tolled while the complainants were unaware that they had filed in the wrong forum).

TIMELINESS OF COMPLAINT; A RESPONDENT IS NOT OBLIGATED TO INFORM THE COMPLAINANT OF THE EXISTENCE OF, OR DEADLINES FOR, POTENTIAL CAUSES OF ACTION

In Daryanani v. Royal & Sun Alliance , ARB No. 08-106, ALJ No. 2007-SOX-79 (ARB May 27, 2010), the Complainant did not file his SOX complaint within 90 days of the date the Respondent notified him of his termination. The Complainant argued that the Respondent should be estopped from raising a timeliness defense because it did not list SOX in the release of the severance agreement and because it failed to counter-sign the severance agreement until after the 90-day statute of limitations had expired. The ARB, however, held that the Respondent was not obligated to inform the Complainant of potential cause of action, the potential deadlines under those statutes, or to take specified actions within the deadlines of known or unknown statutes. The ARB also found that the ALJ had not abused his discretion in denying discovery on the ground that the issue of timeliness could resolved without it. The ARB acknowledged that the issue of equitable modification of a deadline might require discovery to resolve in a particular case, but found that this was not one of those cases.

TIMELINESS OF COMPLAINT; "ACTIVELY MISLED" GROUND FOR EQUITABLE TOLLING DOES NOT APPLY IF COMPLAINANT KNOWS FACTS CONSTITUTING DISCRIMINATORY TREATMENT BUT LACKS DIRECT KNOWLEDGE OF DISCRIMINATORY PURPOSE; NO TOLLING UNTIL COMPLAINANT OBTAINS EVIDENCE OF PURPOSE

In Smale v. Torchmark Corp. , ARB No. 09-012, ALJ No. 2008-SOX-57 (ARB Nov. 20, 2009), the Complainant, a senior auditor, was discharged after submitting three risk observations to the Respondent. Initially, the Complainant was informed that he was discharged on the basis of only one of the reported risk observations. Later, during arbitration proceedings, the Respondent indicated that the Complainant had been discharged because all three risk observations had been improperly submitted. The Complainant did not file a SOX whistleblower complaint until more than a year after his discharge, and relied on the equitable ground of being actively misled respecting the cause of action in regard to the timeliness of the complaint.

The ARB indicated that a litigant seeking to use the "actively misled" grounds for equitable tolling must show "1) the respondents wrongfully concealed their actions, 2) the complainant failed to discover the operative facts that are the basis of the cause of action within the limitations period; and 3) the complainant acted diligently until discovery of the facts." USDOL/OALJ Reporter at 8 (footnote omitted).

In the instant case, the ARB found that there was no concealment - the Complainant knew that he had been terminated and that he had submitted risk observations on the previous day that concerned the SOX. The ARB wrote:

   As explained by the Fifth Circuit, "a showing of deception as to motive supports equitable estoppel only if it conceals the very fact of discrimination; equitable estoppel is not warranted where an employee is aware of all of the facts constituting discriminatory treatment but lacks direct knowledge of the employer's subjective discriminatory purpose." This precept is applicable here - Smale knew that he had engaged in protected activity with respect to the SOX and that he had been adversely affected in the terms of his employment when he was terminated; the only thing he did not know was whether there was discriminatory purpose. Therefore, application of equitable estoppel is not warranted.

USDOL/OALJ Reporter at 8 (footnote omitted). The Complainant also argued that he would be risking a determination that his suit was frivolous if he brought his claim before he knew that the Respondent terminated his employment in part due to his SOX-related risk observation. The ARB, however, agreed with the ALJ that a complainant's failure to acquire evidence of the motivation for the adverse employment action does not affect the complainant's rights or responsibilities for initiating a SOX whistleblower complaint. The ARB wrote that "[t]o toll a limitations period until a complainant acquired evidence of motive �would abort the policy of the law of repose in statutes of limitations of diligence in the equitable principles permitting suspension of them.'" USDOL/OALJ Reporter at 9 (internal quotation is to two 6th Circuit decisions).

TIMELINESS OF COMPLAINT; EQUITABLE TOLLING; CONCEALMENT OF REASON FOR ADVERSE ACTION

In Coppinger-Martin v. Nordstrom, Inc. , ARB No. 07-067, ALJ No. 2007-SOX-19 (ARB Sept. 25, 2009), the Complainant asserted that the limitations period for filing her SOX whistleblower complaint did not begin to run until she learned that her job duties had not been eliminated, because prior to that time she had no reason to know that her termination had been in retatliation for engaging in SOX activity. In affirming the ALJ's finding that equitable tolling or estoppel did not apply, the ARB cited its decision in Halpern v. XL Capital, Ltd. , ARB No. 04-120, ALJ No. 2004-SOX-54 (ARB Aug. 31, 2005), where it held:

Neither the statute [SOX] nor its implementing regulations indicate that a complainant must acquire evidence of retaliatory motive before proceeding with a complaint. Halpern's failure to acquire evidence of [his employer's] motivation for his suspension and firing did not affect his rights or responsibilities for initiating a complaint pursuant to the SOX.

The ARB wrote in regard to the instant case:

   Concealing the reason for an adverse employment action does not toll the statute of limitations governing a whistleblower claim, nor does it estop the employer from asserting timeliness as a defense.29 Moreover, if equitable tolling and equitable estoppel applied whenever an employer gave a non-discriminatory reason for its adverse employment decisions, it would be "'tantamount to asserting that an employer is equitably estopped whenever it does not disclose a violation of [a discrimination] statute.' ... If this were the case, the [time limit] for filing a charge would have little meaning."

USDOL/OALJ Reporter at 6 (footnote omitted).

TIMELINESS OF COMPLAINT; EQUITABLE TOLLING BASED ON FEAR OF RETALIATION; COMPLAINANT MUST ESTABLISH THAT ALLEGED FEAR WAS REASONABLE

In Farnham v. International Manufacturing Solutions , ARB No. 07-095, ALJ No. 2006-SOX-111 (ARB Feb. 6, 2009), the Complainant contended that he had not timely filed his SOX complaint because he feared retaliation from the Respondents if he filed a SOX complaint. The ARB, assuming arguendo that fear of retaliation would constitute an extraordinary event precluding timely filing for which equitable tolling should apply, agreed with the ALJ the Complainant failed to carry his burden of establishing that his alleged fear was reasonable.

The ARB stated that "[t]o establish duress sufficient to toll the running of the limitations period, Farnham must do more than simply allege a subjective fear that the Respondents might retaliate against him. Instead, he must show some act or threat by the Respondents that precluded him from exercising his free will and judgment and prevented him from exercising his legal rights." USDOL/OALJ Reporter at 11 (footnotes omitted). The ARB noted that the Complainant had not alleged that the Respondents made any specific threats against him either before or after he was constructively discharged. Moreover, the Respondent that the Complainant allegedly feared because of drug cartel associations and a criminal background, had not physically threatened the Complainant when he concluded that the Complainant had interfered with the Respondents' loan transactions and slandered that Respondent, but had simply filed a lawsuit to seek redress through the courts. The ARB also agreed with the ALJ that the Complainant's actions following the termination of his employment demonstrated that the Respondents did not deprive him of his free will and judgment or prevent him from seeking his legal rights. The Complainant had instigated an FBI investigation of the Respondents' business activities, discussed his plans to pursue the Respondents with former co-workers, filed a counter suit in response to the Respondents' lawsuit, and complained to a Congressman about the Respondents' business dealings.

TIMELINESS OF COMPLAINT; EQUITABLE TOLLING; FILING OF COMPLAINT WITH THE NLRB

In Corbett v. Energy East Corp. , ARB No. 07-044, ALJ No. 2006-SOX-65 (ARB Dec. 31, 2008), the Complainant argued that his filing of a claim with the National Labor Relations Board (NLRB) on April 29, 2005 tolled SOX's limitations period. The ARB, however, agreed with the ALJ's finding that the Complainant was not entitled to equitable tolling because his filing with the NLRB "was not the precise statutory claim filed in the wrong forum because it was not a request for SOX relief based on accounting irregularities, but instead a request specifically directed to the NLRB based on negotiation and execution of a labor agreement, and requesting a remedy from the NLRB." USDOL/OALJ Reporter at 6.

TIMELINESS OF COMPLAINT; SERIOUSNESS OF COMPLAINT IS NOT GROUNDS FOR EQUITABLE TOLLING

In Ubinger v. CAE International , ARB No. 07-083, ALJ No. 2007-SOX-36 (ARB Aug. 27, 2008), the Complainant acknowledged that his complaint was not timely filed, but asked for a waiver of the time limits based the assertion that his complaints were serious, and based on lack of knowledge of "SOX 806." The ARB rejected the contention that a party should not be constrained by time limits if his or her complaints are serious, observing that such a rule would render limitations periods with no legal force. The ARB also stated that ignorance of the law will not generally support a finding of entitlement to equitable modification of a limitations period. The ARB rejected the contention that an FAA inspector who investigated one of the Complainant's allegations had an obligation to inform him that he could file a SOX complaint. The ARB was not persuaded to invoke equitable tolling based on the Complainant's allegation that he was detained by the Respondent on the final day of the limitations period while being pressured to sign a release. The ARB found that at best this would only merit tolling for the one day he was detained, but the Complainant had not filed his complaint until six months later.

FILING OF COMPLAINT; EQUITABLE TOLLING; FAILURE OF CONGRESSMAN TO DIRECT COMPLAINANT TO SOX

In Levi v. Anheuser Busch Companies, Inc. , ARB Nos. 06-102, 07-020, 08-006, ALJ Nos., 2006-SOX-27 and 108, 2007-SOX-55 (ARB Apr. 30, 2008), the ARB rejected the Complainant's contention that he was entitled to equitable tolling under SOX because he had written to Congressman Richard Gephardt, who had a duty to direct him to SOX. The ARB found that the failure of a Congressman to direct a complainant to SOX was not grounds for equitable tolling.

FILING OF COMPLAINT; EQUITABLE TOLLING; WRONG FORUM; FAILURE TO SPECIFY A SOX VIOLATION OR ALLEGE RETALIATION

In Levi v. Anheuser Busch Companies, Inc. , ARB Nos. 06-102, 07-020, 08-006, ALJ Nos., 2006-SOX-27 and 108, 2007-SOX-55 (ARB Apr. 30, 2008), the Complainant argued that he was entitled to equitable tolling based the raising of the precise statutory claim in the wrong forum because he had written to the SEC about the Respondent's bad behavior and "arrogance" and stated that "[t]his is not accounting fraud, it is much worse." The Complainant's allegations, however, did not relate to mail fraud, bank fraud or securities fraud, or to violations of applicable SEC rules and regulations. Moreover, the letter was written prior to the date that the Complainant received notice of his termination. Thus, even if the letter was read to provide notice to the SEC of fraud or securities violations, it could not be read to state a claim for relief for an act of retaliation. The ARB therefore agreed with the ALJ that equitable tolling was not warranted.

EQUITABLE TOLLING; PRECISE CLAIM IN WRONG FORUM

In Harvey v. Home Depot U.S.A., Inc. , ARB Nos. 04-114 and 115, ALJ Nos. 2004-SOX-20 and 36 (ARB June 2, 2006), the Complainant did not timely file a SOX complaint with the Department of Labor, so the ARB considered whether the Complainant was entitled to equitable tolling based on letters he wrote to the Deputy Attorney General and to the SEC. For equitable tolling to apply, the Complainant must have shown that he filed the precise statutory claim in issue (a SOX whistleblower claim) but merely did so in the wrong forum. The letter to the Deputy Attorney General at the Justice Department alleged corporate malfeasance and bad and negligent corporate governance -- specifically violations of the Complainant's constitutional, civil, first amendment and Title VII rights allegedly condoned by the Board of Directors. The ARB found that such allegations were not SOX-protected activity because they did not relate, for example, to instances of misrepresentation of the Respondent's financial condition or fraud against its shareholders. The letters to the SEC were similar in content. The ARB wrote that although the Complainant made general, conclusive accusations of "corporate malfeasance" and "bad and negligent corporate governance," the specific context he provided for his accusations related only to unprotected allegations, and thus he did not state a cause of action under the SOX. Accordingly, the Complainant had not filed the precise statutory claim in the wrong forum and was not entitled to equitable tolling.

TIMELINESS OF COMPLAINT; EQUITABLE TOLLING; PRECISE COMPLAINT IN WRONG FORUM GROUND MUST BE SUPPORTED WITH AN EXPRESSION OF A REASONABLE BELIEF THAT THE RESPONDENT WAS DEFRAUDING SHAREHOLDERS OR VIOLATING SECURITY REGULATIONS

In Carter v. Champion Bus, Inc. , ARB No. 05-076, ALJ No. 2005-SOX-23 (ARB Sept. 29, 2006), the Complainant alleged that his EEOC complaint and a filing with the Michigan Department of Civil Rights entitled him to equitable tolling for the filing of his SOX whistleblower complaint. The ARB held that "[t]o be considered the 'precise complaint in the wrong forum,' the EEOC complaint must demonstrate that Carter engaged in SOX-protected activity prior to his discharge. His complaints to Champion management must have provided information regarding Champion's conduct that Carter reasonably believed constituted mail, wire, radio, TV, bank, or securities fraud, or violated any rule or regulation of the SEC, or any provision of Federal law relating to fraud against shareholders." Reviewing the EEOC complaint, the ARB found that it did not contain an allegation of retaliation under SOX. The Michigan complaint contained a notation from the Complainant that he had been advised that the complaint would be more appropriate "under whistle blower protection laws." The ARB found, however, that the reference to whistleblower laws did not remedy the absence in the filing of an expression of a reasonable belief that the Respondent was defrauding shareholders or violating security regulations.

TIMELINESS OF COMPLAINT; EQUITABLE TOLLING; FILING WITH AGENCIES NOT RESPONSIBLE FOR ADMINISTRATION OF SOX WHISTLEBLOWER PROVISION

In Carter v. Champion Bus, Inc. , ARB No. 05-076, ALJ No. 2005-SOX-23 (ARB Sept. 29, 2006), the Complainant argued on appeal that equitable tolling for the filing of his SOX complaint should be granted based on Doyle v. Alabama Power Co. , 1987-ERA-43 (Sec'y Sept. 29, 1989), which he quoted as stating that when "there is a complicated administrative procedure, and an unrepresented, unsophisticated complainant receives information from a responsible government agency, a time limit may be tolled'." The Respondent pointed out that the Complainant had misquoted the Secretary's decision by omitting the critical word "misleading," i.e., "when . . . [a] complainant receives misleading information from a responsible government agency." The Complainant then argued that the limitations period should be tolled because the EEOC and a state agency had allegedly provided him with misleading information concerning the filing of his SOX complaint. The ARB noted that it would decline to consider an issue raised for the first time on appeal, but that even the argument was properly before it, it would reject it because neither the EEOC or the state agency was the responsible government agency, because given the generic allegations made in the EEOC complaint it was hardly surprising that EEOC did not recognize a SOX complaint, and because a similar argument had been rejected in School Dist. of Allentown v. Marshall , 657 F.2d 16 (3d Cir. 1981). Ultimately, ignorance of the law is not sufficient to invoke equitable tolling.

TIMELINESS OF COMPLAINT; EQUITABLE MODIFICATION OF LIMITATIONS PERIOD; SILENCE OF RESPONDENT FOUND NOT TO HAVE ACTIVELY MISLED COMPLAINANT; IGNORANCE OF ATTORNEY AND COMPLAINANT ABOUT EXISTENCE OF SOX NOT GROUNDS FOR EQUITABLE MODIFICATION

In Moldauer v. Canadaigua Wine Co. , ARB No. 04-022, ALJ No. 2003-SOX-26 (ARB Dec. 30, 2005), the ARB granted summary judgment to the Respondent on the ground that the SOX complaint was not timely filed. The Complainant had been terminated by the Respondent. A severance agreement included the Complainant's release of any discrimination claims he might have against the Respondent under state and federal law. The Complainant's subsequent complaint filed with OSHA was untimely as a SOX complaint. The Complainant asserted that equitable modification of the limitations period should be applied because the Respondent actively misled him when it remained silent about its position that the release excluded SOX claims. The ARB, however, found that the Respondent's mere silence about SOX did not mislead the Complainant, especially since he was represented by counsel when he entered into the severance agreement.

The Complainant next claimed that his counsel's knowledge or lack of knowledge of SOX raised a genuine issue of material fact; the ARB, however, held that clients ultimately bear the consequences of the acts or omissions of a freely chosen attorney. Similarly, the ARB was not persuaded that the Complainant's own lack of awareness of SOX presented grounds for equitable modification of the limitations period.

ADMINISTRATIVE LAW JUDGE DECISIONS

TIMELINESS OF COMPLAINT; EQUITABLE ESTOPPEL; COMPLAINANT'S ALLEGED FEAR OF RESPONDENT'S ALLEGED CRIMINAL CONNECTIONS

In Farnham v. International Manufacturing Solutions , 2006-SOX-111 (ALJ June 18, 2007), the ALJ declined to apply equitable principles to permit the Complainant to proceed with his untimely filed SOX complaint, where the Complainant's actions undermined the credibility of his assertion that he was too afraid to file the SOX complaint because of fears that the Respondent was associated with a drug cartel. The ALJ noted that during the time that the Complainant delayed sending a letter to his congressman seeking protection as a corporate whistleblower (the letter being forwarded to OSHA, which treated it as a whistleblower complaint), the Complainant continued to work for the Respondent for a period of time, he contacted the FBI with more information than would have been needed to file a complaint with OSHA, he filed a counter-suit in a civil suit brought by the Respondents, and contacted current and former employees of the Respondent to discuss the Respondent's alleged fraudulent behavior. The ALJ found that the Respondent's actions did not cause the Complainant not to file his SOX complaint in a timely fashion.

TIMELINESS OF COMPLAINT; EQUITABLE TOLLING; MERE EVIDENCE OF PHYSICAL INJURY, WITHOUT EVIDENCE OF INABILITY TO COMMUNICATE, DOES NOT SUPPORT TOLLING

In Goode v. Marriott International, Inc. , 2006-SOX-115 (ALJ Oct. 13, 2006), the ALJ rejected the contention that the Complainant was entitled to equitable tolling of the time period for filing a SOX whistleblower complaint based on the extraordinary circumstance of a severe leg and foot injury requiring extended recuperation and physical therapy. The ALJ found no evidence that the Complainant's mental abilities had been impaired or that he was unable to communicate. Rather, to the contrary, the Respondent presented 18 e-mails demonstrating that the Complainant was fully able to communicate during this time period.

TIMELINESS OF COMPLAINT; EQUITABLE TOLLING; RESPONDENT'S ACTIVELY MISLEADING CONDUCT

In Bulls v. Chevron/Texaco, Inc. , 2006-SOX-117 (ALJ Oct. 13, 2006), the Complainant did not file his SOX complaint within 90 days of his termination, but argued in response to the Respondent's motion for summary decision that his post-termination participation in the Respondent's internal dispute resolution process ("STEPS") supported equitable tolling of the limitations period. First, the Complainant pointed to language in the STEPS documentation which read: "Employees do not give up any rights to seek other legal remedies if they are unable to resolve disputes using the STEPS process. The company, however, requires that employees do use STEPS before proceeding to litigation." In describing wrongful discharge and related claims and arbitration, the documentation stated: "If not satisfied with the arbitrator's decision, the employee is free at that time to pursue the matter through other legal opinions, including litigation." The Complainant argued that this language misled the Complainant into believing that he needed complete the STEPS program before taking legal action. The ALJ, however, found that this language was not a contractual waiver by the Respondents of their right to assert the issue of timeliness. The ALJ found that, in analyzing whether the Respondents "actively misled" the Complainant, the Respondents must have acted or communicated in such a way as to be objectively misleading, and the Complainant must have subjectively held a reasonable belief, based on the Respondent's misleading conduct, and acted on that belief.

The ALJ found that the STEPS documentation also indicated that use of STEPS was in consideration for continued employment, meaning that it was not binding on a former employee. The ALJ found that, although the Respondents offered incentives to use STEPS, it had no power to prevent the Complainant from timely filing a law suit. The ALJ found that the Complainant's counsel's belief that the Complainant was bound to complete STEPS before proceeding to litigation was not relevant, and that the Respondents were under no obligation to correct counsel's error, if they were aware of it. Although the Complainant alleged that his former counsel had assured him that the attorneys had agreed to toll the statute of limitations, and the ALJ acknowledged that parties are free to contract to toll the statute of limitations for federal causes of action, the Complainant had failed to provide an affidavit or sworn declaration by persons with personal knowledge of the actual communications. The ALJ found that the Complainant's affidavit, which only supported personal knowledge of a later account of the events in question, was not sufficient to raise a question of material fact.

TIMELINESS OF COMPLAINT; EQUITABLE ESTOPPEL AND EQUITABLE TOLLING

In Guy v. SBC Global Services , 2005-SOX-113 (ALJ Dec. 14, 2005), the complaint was untimely, and the Complainant sought to invoke equitable estoppel and equitable tolling to enable her to proceed.

The Complainant supported her equitable estoppel argument on the grounds that a promise had been made to her that she would not be retaliated against as a result of her cooperation with an internal investigation, the fact that she had a positive experience with the Respondent in regard to an earlier unrelated discrimination matter making her expect similar treatment with regard to her current complaint, and an alleged statement by the Respondent's attorney during a settlement negotiation that "HR is the proper place to start" The ALJ found that equitable estoppel did not apply because "there is simply nothing in Respondent's actions or statements that provide any reasonable basis upon which Complainant could have relied for not filing" a timely complaint.

In regard to equitable tolling, the ALJ found no evidence that the Respondent misled the Complainant regarding her cause of action, that there were any extraordinary circumstances that may have prevented her from timely asserting her rights under the Act, and that her merely speaking to an EEOC investigator within the 90 day limitations period without filing any kind of formal complaint could not constitute filing in the wrong forum.

TIMELINESS OF COMPLAINT; EQUITABLE TOLLING; IGNORANCE OF THE LAW

A party seeking to invoke equitable tolling for the filing of a SOX whistleblower complaint based on the professed ignorance of the applicability of the SOX to his or her situation must show that his or her ignorance of the limitations period was caused by circumstances beyond the party's control such as mental incapacity. See Guy v. SBC Global Services , 2005-SOX-113 (ALJ Dec. 14, 2005).

TIMELINESS OF COMPLAINT; EQUITABLE TOLLING; FAILURE TO SECURE COUNSEL

Failure to secure counsel in order to pursue a claim under the SOX whistleblower provision is an insufficient reason, in and of itself, to justify equitable tolling of the limitations period for filing a complaint. Barker v. Perma-Fix of Dayton, Inc. , 2006-SOX-1 (ALJ Jan. 11, 2006).

TIMELINESS OF COMPLAINT; EQUITABLE ESTOPPEL

In Piles v. Lee Hecht Harrison, LLC , ALJ Nos. 2005-SOX-55 and 56 (ALJ Nov. 8, 2005), the Complainants filed their SOX whistleblower complaints approximately five months beyond the 180 day limitations period, but presented an argument that the complaints should be construed as timely because the Respondent purportedly used two ploys to lull them into a "wait and see" posture. The ALJ found that this was an "equitable estoppel" theory. Construing all of the Complainants' factual allegations as true for purposes of considering the Respondent's motion for summary decision, the ALJ found that, as a matter of law, equitable estoppel did not apply.

The Complainants had been told that their positions were being eliminated, although they would be eligible to work at other offices if work arose. The Complainants believed that their jobs were terminated for making too many inquiries about billing issues concerning a certain account. Following their termination one of the Complainants continued to communicate his concerns to the Respondent's management. He was told that his concerns would be investigated and that he would be contacted. Over the next several months, he had several contacts with officials and lawyers for the Respondent about the concerns. In addition, during the time the company investigated the complaints, the Complainants were under the impression that they remained "project eligible." The Complainant's passwords to the Respondent's intranet communications systems, for example, remained active so that they could monitor possible future assignments.

Reviewing relevant caselaw, the ALJ found that the Complainants could not "use their hope that Respondent's investigation would be timely completed in a manner favorable to their complaints as grounds for equitable relief from the Act's complaint filing deadline." Slip op. at 9. There was simply no evidence that the Respondent had pursued the investigation in bad faith as a stall tactic or had even suggested that the Complainants wait for the results of the investigation before voicing their complaints in another arena. The ALJ also found that there was no evidence that the "project eligible" status and continuing intranet access were designed as a tactic to delay the Complainants from filing a SOX whistleblower complaint. There was no evidence of affirmative misrepresentations by the Respondent or a deliberate plan to mislead the Complainants.

UNTIMELY FILING OF COMPLAINT; EQUITABLE ESTOPPEL; SEVERANCE AGREEMENT; MUST SHOW THAT COMPLAINANT WAS LULLED INTO INACTION

In Moldauer v. Canandaigua Wine Co. , 2003-SOX-26 (ALJ Nov. 14, 2003), Complainant alleged that he was entitled to equitable estoppel to excuse an untimely filing of a SOX whistleblower complaint based on his signature of a severance agreement in which he agreed to release any discrimination claims he might have under federal and state law against Respondent in exchange for his severance package. The ALJ found the issue to be whether Respondent entered the severance agreement in order to prevent Complainant from asserting his rights under the Act. The ALJ found that equitable estoppel did not apply, writing:

Most importantly, the doctrine of equitable estoppel requires that the complainant reasonably rely on the respondent's conduct. Santa Monica , 202 F.3d at 1177. Despite the severance agreement, Mr. Moldauer filed a complaint with [the California Department of Fair Employment and Housing], met with the FBI to discuss Respondent's alleged accounting improprieties, and complained to the SEC about Respondent's accounting practices within one month of signing the severance agreement. Collectively, these actions indicate that Mr. Moldauer was not lulled into inaction by the severance agreement.

UNTIMELY COMPLAINT; EQUITABLE TOLLING; DEPARTURE FROM COUNTRY; WRONG FORUM; IGNORANCE OF THE LAW

In Moldauer v. Canandaigua Wine Co. , 2003-SOX-26 (ALJ Nov. 14, 2003), Complainant alleged that he was entitled to equitable tolling to excuse an untimely filing of a SOX whistleblower complaint based on three grounds: (1) he was unable to conduct his affairs after he was terminated because he had to leave the United States, (2) he raised this claim with incorrect agencies within the statutory period, and (3) neither Complainant nor the attorney he retained in conjunction with the severance agreement were aware of the Act's whistleblower protection provisions. The ALJ observed that "[e]quitable tolling may be appropriate when the complainant demonstrates that extraordinary circumstances prevented him from 'managing his affairs and thus from understanding his legal rights and acting upon them.' Hall v. EG&G Defense Materials, Inc. , ARB Case No. 98-076 (ARB Sept. 30, 1998)." The ALJ observed that Complainant had an experienced attorney, that he registered complaints with a state agency, the FBI and the SEC prior to leaving the country, and that his departure was apparently voluntary - and therefore found that he was not entitled to equitable tolling on this ground. Equitable tolling for filing in the wrong forum was not warranted because the complaint Complainant filed with the state agency - although referencing "whistleblowing" - did not implicate activities covered by the Sarbanes-Oxley Act whistleblower provision, and because Complainant failed to produce a copy of the complaint he filed with the SEC. Moreover, because he was represented by an attorney Complainant is deemed to have had constructive notice of the SOX whistleblower complaint procedure and the agency with which such a complaint should have been filed. Finally, the ALJ found that lack of awareness that SOX contained a whistleblower provision did not warrant equitable tolling because a Complainant who has retained counsel is deemed to have had constructive notice of appropriate legal remedies and, even for unrepresented claimants there is no authority for tolling a statute of limitations based on ignorance of the law.

Filing Directly With the Secretary

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ADMINISTRATIVE REVIEW BOARD DECISIONS

FILING OF SOX COMPLAINT; FILING DIRECTLY WITH SECRETARY RATHER THAN OSHA

Even though the regulations specify that SOX whistleblower complaints should be filed with the OSHA Area Director responsible for enforcement activitities in the geographical area where the complainant employee resides or was employed, or with any OSHA officer or employee, 29 C.F.R. § 1980.103(c), a complaint filed directly with the Secretary of Labor satisfies the filing requirements under the SOX. Harvey v. Home Depot U.S.A., Inc. , ARB Nos. 04-114 and 115, ALJ Nos. 2004-SOX-20 and 36 (ARB June 2, 2006).

Protected Activity Prior to Effective Date of SOX, But Adverse Action After Effective Date

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ADMINISTRATIVE REVIEW BOARD DECISIONS

EFFECTIVE DATE OF SOX; COVERAGE MAY BE ESTABLISHED EVEN THOUGH PROTECTED ACTIVITY OCCURRED BEFORE SOX WAS EFFECTIVE IF ADVERSE ACTION OCCURRED AFTER EFFECTIVE DATE

In Harvey v. Home Depot U.S.A., Inc. , ARB Nos. 04-114 and 115, ALJ Nos. 2004-SOX-20 and 36 (ARB June 2, 2006), the Complainant's protected activity occurred prior to the effective date of the SOX whistleblower provision. The ARB noted, however, that it had implicitly recognized in prior cases that SOX whistleblower protection may apply so long as the complainant proves that the protected activity was a contributing factor and the adverse action occurred after the effective date of the SOX.

Whether the Respondent Must File an Answer to the Complaint

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ADMINISTRATIVE REVIEW BOARD DECISIONS

WHETHER THE RESPONDENT IS REQUIRED TO ANSWER THE COMPLAINT FILED WITH OSHA AND A COMPLAINANT'S OBJECTIONS TO THE OSHA FINDINGS/REQUEST FOR HEARING

In Brady v. Direct Mail Management, Inc. , ARB No. 06-044, ALJ No. 2006-SOX-16 (ARB Mar. 26, 2008), it was undisputed that the complaint was not timely filed. Moreover, no grounds existed for equitable relief. The Complainant argued that the Respondent had waived its right to defend against the complaint because it had not answered the complaint filed with OSHA and had not responded to the Complainant's objections to the OSHA findings/request for hearing. The ARB affirmed the ALJ's grant of summary judgment against the Complainant, but clarified the analysis in regard to the waiver issue. The ARB held that the regulations make the filing of response to the complaint filed with OSHA, and to the objections/request for hearing, discretionary, not mandatory. See 29 C.F.R. §§ 1980.104(a), (c), 1980.106(a), (b). (The ALJ had held that OALJ's general rules of practice and the SOX procedural rules were inconsistent, and had not referenced the SOX rule about the filing of an answer to a complaint.) Finally, the ARB observed that OSHA had dismissed the complaint only eight days after it was filed on the ground of lack of timeliness, and held that "[w]here OSHA dismissed the complaint before the running of the time (20 days after notice) in which [the Respondent] would have had to respond to the complaint, [the Respondent] did not waive its right to defend against it." USDOL/OALJ Reporter at 7.

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