On January 5, 2016, Beranbaum Menken LLP filed a lawsuit in federal court against Viacom International Media Networks for its retaliatory firing of Nataki Williams, Vice President for Financial Planning and Analysis, after she spoke out against Viacom’s scheme to avoid paying US corporate taxes by transferring the licensing right of Teenage Mutant Ninja Turtles to a nominal entity in the Netherlands.  Ms. Williams, who won two Viacom “Presidential Awards” and two promotions in her seven years at Viacom, was terminated while on maternity leave after the birth of her first child.  Prior to going on leave, she had repeatedly voiced her objections to what she believed was an illegal tax scheme—a belief further solidified when her superiors joked about “not looking good in orange” and instructed Ms. Williams not to discuss the plan over email.  She is suing under the The Securities Whistleblower Incentives and Protection section of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the anti-retaliation provisions of Sarbanes-Oxley.  The case is Williams v. Viacom International Media Networks, Inc., U.S. District Court, Southern District of New York, No. 16-00029. Links to Press Coverage:





Read the Complaint here

Southern District of New York holds that a complaint to the SEC is not necessary for a whistleblower to be protected from retaliation

The Dodd-Frank Act (DFA) potentially makes it very lucrative for an employee to blow the whistle on their employer’s violations of the securities laws, if the Securities and Exchange Commission (SEC) recovers money on behalf of defrauded investors because of the whistleblower’s information. But the DFA’s protections against whistleblower retaliation are equally important - few whistleblowers would come forward if their jobs were not protected. Unfortunately, the DFA is ambiguous on this point. The law defines a “whistleblower” as any individual who provides information relating to a violation of the securities laws to the SEC. 15 U.S.C. §78u-6(a)(6). However, a separate part of the DFA forbids an employer from retaliating against an employee for providing information to the SEC, for participating in an SEC action, or for “making disclosures that are required or protected under the Sarbanes-Oxley Act....” 15 U.S.C. § 78u-6(h)(1)(A). Sarbanes-Oxley, unlike the DFA, explicitly protects employees who provide information about securities law violations not just to the SEC, but to any Federal regulatory or law enforcement agency, or to a supervisor at the employer’s workplace. 18 U.S.C. § 1514A.

So, Dodd-Frank on the one hand limits its definition of “whistleblower” to those providing information to the SEC, and on the other hand protects from retaliation whistleblowers who report wrongdoing under the broader Sarbanes Oxley requirements. The SEC, in a regulation, adopted the broader view, and held that whistleblowers are protected under the DFA even if they report the wrongdoing to another agency, or internally with their employer. The Fifth Circuit Court of Appeals went against the SEC and held that the DFA’s definition of whistleblower controls, and so only whistleblowers who report wrongdoing to the SEC are protected by the DFA. Asadi v. G.E. Energy, 720 F.3d 620 (5th Cir. 2013).

Enter Judge Scheindlin. The plaintiff in Rosenblum v. Thomson Reuters, 13 Civ. 2219, complained about potential securities law violations to the FBI and to his supervisor, and was fired about a month later. Thomson Reuters moved to dismiss his lawsuit, pointing to the Asadi decision and arguing that he was not a whistleblower under Dodd Frank. Judge Scheindlin denied the motion and held that Rosenblum’s FBI and internal complaints protected him from retaliation under Dodd-Frank. Essentially, Judge Schindlin held that SEC was right and the Fifth Circuit was wrong.

Eventually, the Second Circuit will be asked to resolve this question, so stay tuned.

Blowing the Whistle on Medicare/Medicaid Fraud in the Dermatology Industry

The False Claims Act allows certain kinds of whistleblowers to receive awards for helping collect government money that was companies obtained by fraud. One of the more common types of False Claims Act cases involve Medicare and Medicaid fraud in the health care industry, where health care providers “upcode,” i.e. they indicate that they used a more expensive procedure on a patient than they actually did. Essentially, such doctors are billing the government for expensive procedures that weren’t actually performed. Beranbaum Menken is currently investigating whether a certain well known dermatologist with many offices throughout the metropolitan NYC area has been upcoding to obtain higher payments from Medicare and/or Medicaid for minor procedures on patients with acne or warts.  The firm has information that this dermatologist is upcoding to fraudulently obtain payment for excisions and minor procedures he and his colleagues did not actually perform.  Confidentially call Bruce Menken at (212) 509-1616 if you know of any dermatologist, or any other kind of doctor, that upcodes to line their own pockets and defraud the government.

NYLJ Article about BMBB's Case, Anderson v. NYS

Today's New York Law Journal published on its first page the following article about one of BMBB's cases, Anderson v. New York State et al:

New York state, in a motion for summary judgment filed last week, portrayed an attorney who sought $10 million damages for her firing by the First Department's Departmental Disciplinary Committee as violating the direct orders of her superiors. The lawyer, Christine C. Anderson, filed the lawsuit in 2007 claiming she was fired after six years as a staff attorney because she complained the committee's chief counsel and his top deputy were "whitewashing" complaints against "certain select attorneys" (NYLJ, Oct. 30, 2007). A brief filed for the defendants -- the state and three committee officials -- stated that instead of following her direct supervisor's orders, Ms. Anderson engaged in "an eight month campaign to circumvent and berate" the supervisor, Sherry K. Cohen. The brief, which was written by Assistant Attorneys General Lee Alan Adlerstein and Wesley E. Bauman, also contended that the "highest officers" in the First Department were aware of Ms. Anderson's "ascerbic and posturing conduct." Ms. Anderson's attorney, John A. Beranbaum, reported that the defendant's brief is using an "employers' time-honored technique of trying to trivialize a valid whistleblowing claim" by labeling "a disgruntled employee's personal grievance." Mr. Beranbaum, of Beranbaum Menken Ben-Asher & Bierman, added, "at the end of the day, this tactic will prove unsuccessful."