COURT RULES BOEING LEGALLY FIRED WHISTLEBLOWING AUDITORS

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By TESTCustomwebLP TESTCustomwebLP May 4, 2011 08:43

COURT RULES BOEING LEGALLY FIRED WHISTLEBLOWING AUDITORS

Two auditors that were fired by Boeing for leaking information about Boeing’s compliance with Sarbanes-Oxley (Sox) to the press have failed in their bid to claim whistleblowing protection as an appeals panel yesterday ruled that Boeing could legally fire them for leaking information to the Seattle Post-Intelligencer.

Matthew Neumann and Nicholas Tides claimed that managers pressured auditors to rate Boeing’s internal controls as “effective,” fostered a hostile work environment and ignored their concerns about this pressure and potential violations of Soc, according to Tuesday’s ruling. These potential violations related to Boeing giving PricewaterhouseCoopers contractors managerial authority over Boeing employees, the involvement of the contractors in the design and audit of Boeing’s internal controls and the integrity of data the software system Boeing used to record relevant audit results.

The two men are claimed to have series of emails to a Seattle Post-Intelligencer reporter in June 2007 from his Boeing computer documenting the concerns raised, along with several internal Boeing documents, including copies of the company’s policies governing contract labour. The Seattle Post-Intelligencer published a report about these issues on July 17, 2007. When an investigation by Boeing discovered that Neumann and Tides had given information to the paper, the company suspended and then fired the auditors.

Neumann and Tides subsequently filed federal complaints, arguing for protection under the whistleblower provision of Sox but this was dismissed on February 9, 2010 by US District Court Judge John Coughenour. On appeal the pair claimed that speaking to the press counted under Sox as a means for communicating misdeeds to stop misconduct. The Act states that any employee who provides information to a federal regulatory or law enforcement agency, a Congress member or committee, or a company supervisor or employee with authority to investigate, find or stop misconduct will be protected. Because the media is not mentioned specifically, their appeal was rejected. The 9th Circuit Court of Appeals Judge Barry Silverman wrote for the three-judge panel in Tuesday’s ruling. “We decline to adopt such a boundless interpretation of the statute.

“If Congress wanted to protect reports to the media under (the whistleblower provision) it could have listed the media as one of the entities to which protected reports may be made,” Silverman added. “Or, it could have protected ‘any disclosure’ of specified information, as it did with the Whistleblower Protection Act.”

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By TESTCustomwebLP TESTCustomwebLP May 4, 2011 08:43
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