Genberg v. Porter - 882 F.3d 1249 (10th Cir. 2018)

Rule:

Congress passed the Sarbanes-Oxley Act to protect investors by improving the accuracy and reliability of corporate disclosures. Sarbanes- Oxley Act of 2002, Pub. L. No. 107-204, 116 Stat. 745, 745. To further this goal, the Act protects whistleblowing employees of publicly traded companies who tell superiors about a violation of federal securities law. 18 U.S.C.S. § 1514A. The Act supplies this protection by allowing suit against a publicly traded company or its officers for retaliation. 18 U.S.C.S. § 1514A. For a prima facie case of retaliation, a plaintiff must show that (1) he or she engaged in protected activity,(2) the employer knew of the protected activity,(3) the plaintiff suffered an unfavorable employment action, and (4) the protected activity was a factor that contributed to the unfavorable employment action. If a prima facie case is shown, the defendant can assert a statutory defense known as the "same-action defense." This defense requires proof by clear and convincing evidence that the same action would have been taken even without the protected activity.

Facts:

This appeal grew out of the firing of Mr. Carl Genberg, an executive for Ceragenix Corporation. Mr. Genberg allegedly suspected misconduct by Ceragenix's Board of Directors. When he acted on these alleged suspicions, he was fired. Genberg then sued Ceragenix's Chief Executive Officer, Mr. Steven Porter, for retaliation under the Sarbanes-Oxley Act of 2002 and defamation under Nevada law. The district court granted summary judgment to Porter on both claims. 

Issue:

Did the district court err in granting summary judgment to Porter for Genberg’s claim of retaliation under the Sarbanes-Oxley Act of 2002 against Porter?

Answer:

Yes.

Conclusion:

The court reversed the grant of summary judgment to Porter on the retaliation claim under the Sarbanes-Oxley Act of 2002 because the district court's "definitive and specific" standard was no longer applicable, applying the correct standard, a fact finder could reasonably conclude that writing the March 2 email had entailed a protected activity, and a genuine factual dispute existed on whether the emails had contributed to the firing. Porter was entitled to summary judgment on the defamation claim where Genberg did not present evidence that Porter thought his statements were false or disregarded their falsity.