SOX's Whistleblower: the Whistle Not Heard Around the World

In early 2006, the First Circuit held that the whistleblower provision of 18 U.S.C.S. § 1514A does not protect foreign employees of American controlled companies.  See Carnero v. Boston Sci. Corp., 433 F.3d 1 (1st Cir. Jan. 5, 2006).  Carnero involved an Argentinian citizen who worked for a Argentinian company owned by a Delaware corporation.  The employee informed his superiors in the Delaware corporation that his employer was overcharging customers in Latin America.  He was fired shortly thereafter. The employee then sued the Delaware corporation under 18 U.S.C.S. § 1514A – or the “Whistleblower” protection provision of Sarbanes-Oxley.  The district court found that § 1514A did not have extraterritorial effect for two chief reasons: (1) a presumption against extraterritorial effectuation and (2) there was insufficient evidence proving the plaintiff's assertion that Congress did intend for § 1514A to apply extraterritorially. 

Appellee's Brief