## Facts

- Daniel Berman worked as a finance director at Neo@Ogilvy LLC, an advertising and marketing company affiliated with WPP Group USA, Inc.
- Berman alleged he discovered conduct he believed violated federal securities laws and reported his concerns internally.
- Berman alleged Neo@Ogilvy terminated his employment in retaliation for his internal reporting.
- Berman did not report the alleged violations to the Securities and Exchange Commission (SEC) before his termination.
- Berman sued under Dodd–Frank’s whistleblower anti-retaliation provision, Exchange Act § 21F(h)(1)(A), 15 U.S.C. § 78u-6(h)(1)(A).
- The district court dismissed for failure to state a claim, ruling Dodd–Frank anti-retaliation protection requires reporting to the SEC.
- The SEC appeared as amicus curiae on appeal, supporting an interpretation that protects certain internal reporters.

## Issues

1. Whether the statutory definition of “whistleblower” in Exchange Act § 21F(a)(6) unambiguously limits Dodd–Frank anti-retaliation protection to individuals who report securities-law violations to the SEC.
2. If the statute is ambiguous, whether Chevron deference applies to the SEC’s rule interpreting § 21F(h)(1)(A) to protect individuals who make disclosures described in § 21F(h)(1)(A)(iii), including certain internal reports, even without a prior SEC report.

## Decision

- The Second Circuit reversed the dismissal and remanded.
- The court held that tension between § 21F(a)(6)’s definition (requiring reports “to the Commission”) and § 21F(h)(1)(A)(iii)’s incorporation of disclosures protected by Sarbanes–Oxley (which may be purely internal) creates statutory ambiguity.
- Applying Chevron, the court deferred to the SEC’s Rule 21F-2(b)(1), which treats individuals as covered for anti-retaliation purposes when they engage in conduct described in § 21F(h)(1)(A), including internal reporting under subsection (iii).
- Under the SEC’s interpretation, Berman’s alleged internal reporting could qualify for Dodd–Frank anti-retaliation protection despite no pre-termination SEC report.
- A dissent would have affirmed, reading the statutory definition as unambiguous and controlling.

## Legal Principles

- When statutory provisions create an internal conflict about coverage, the statute may be ambiguous even if one provision appears clear in isolation.
- Dodd–Frank § 21F(h)(1)(A)(iii)’s reference to disclosures “required or protected” by Sarbanes–Oxley and related laws supports coverage for certain internal reports.
- Under Chevron, courts may defer to an agency’s reasonable interpretation that reconciles conflicting statutory text within the agency’s jurisdiction.
- For Dodd–Frank anti-retaliation claims in the Second Circuit, an employee may fall within § 21F(h)(1)(A)’s protection based on qualifying internal disclosures, even if the employee had not reported to the SEC before the alleged retaliation.

## Conclusion

The Second Circuit held that Dodd–Frank’s whistleblower anti-retaliation provision is ambiguous when read alongside the statute’s definitional section, and it deferred to the SEC’s rule extending protection to employees who make certain internal disclosures incorporated by § 21F(h)(1)(A)(iii), reversing the dismissal of Berman’s claim and remanding for further proceedings.


Berman v. Neo@Ogilvy LLC, 801 F.3d 145 (2d Cir. 2015)