When is a Sarbanes-Oxley Retaliation Claim Timely?

In Rzepiennik v. Archstone-Smith, Inc., the Tenth Circuit Court of Appeals, the federal circuit having jurisdiction over Utah, considered the question of when a retaliation claim under the Sarbanes-Oxley Act (SOX) is considered timely. The employee in the case contended that his employer had retaliated against him when he reported financial irregularities internally by terminating his employment. After his termination and during an investigation of the claims, he alleged that his employer offered him an incentive bonus of $255,589 for his work only if he agreed “1) not to disclose to any person or regulatory agency the facts about the alleged fraud or [the employer’s] investigation, and 2) to return to [the employer] all documents and copies he possessed relating to his allegations.” This offer was made on August 20, 2003, and it gave him 21 days to accept the terms. On September 12, 2003, he attempted to negotiate the terms but the employer refused to change the terms.

On December 15, 2003, he filed a complaint with the Occupational Safety and Health Administration (OSHA), the agency responsible for SOX compliance. The Court ruled that the filing was late because it had been more than 90 days—the statute of limitations time period—since the illegal offer was made. The employee, among other things, contended the proper trigger date was September 12, 2003, the date the offer expired and the date of his negotiations with the employer. The Tenth Circuit rejected that argument, ruling that the discriminatory act was the employer’s illegal offer and it was made on August 20, 2003. The Court also considered and rejected the argument that the Lilly Ledbetter Fair Pay Act applied to SOX violations.