Murray v. UBS Securities
43 F.4th 254
2d Cir.2022Background
- Trevor Murray was a CMBS strategist at UBS required by SEC rules to certify independent research; he alleged trading-desk leaders pressured him to skew reports.
- Murray reported the pressure and alleged fraud to his supervisor, Michael Schumacher, in Dec. 2011 and Jan. 2012; Schumacher later recommended removing Murray from headcount and discussed termination.
- UBS eliminated Murray’s position and terminated him in Feb. 2012 amid firm-wide layoffs; Murray sued under Sarbanes-Oxley §1514A claiming retaliatory discharge.
- At trial the district court instructed the jury on SOX elements but did not require a finding of employer retaliatory intent; the jury found for Murray and returned advisory damages.
- On appeal UBS argued the court should have required proof of retaliatory intent; the Second Circuit held retaliatory intent is an element of a §1514A claim, found the omitted instruction non-harmless, vacated the verdict, and remanded for a new trial.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §1514A requires proof of employer retaliatory intent | Murray: retaliatory intent is not an element; contributing-factor standard suffices | UBS: statute’s "discriminate … because of" language requires intent to discriminate/retaliate | Court: Yes. Employer retaliatory intent is an element; plaintiff must prove by preponderance that the adverse action was motivated by whistleblowing |
| Whether failure to instruct jury on intent was harmless error | Murray: erroneous instruction did not affect verdict (jury found contributing factor) | UBS: error prejudiced outcome given evidence of non-retaliatory layoffs and competing explanations | Court: Not harmless. Instructional error could have influenced jury; judgment vacated and case remanded for new trial |
Key Cases Cited
- Tompkins v. Metro-N. Commuter R.R. Co., 983 F.3d 74 (2d Cir. 2020) (interpreting nearly identical FRSA language and requiring some evidence of retaliatory intent)
- Bechtel v. Admin. Rev. Bd., 710 F.3d 443 (2d Cir. 2013) (articulating elements of a SOX §1514A claim including contributing-factor formulation)
- Marx v. Gen. Revenue Corp., 568 U.S. 371 (U.S. 2013) (statutory interpretation principle: start with ordinary meaning of text)
- Vega v. Hempstead Union Free Sch. Dist., 801 F.3d 72 (2d Cir. 2015) (explaining "because of" as motivating/substantial factor in discrimination context)
- Armstrong v. BNSF Ry. Co., 880 F.3d 377 (7th Cir. 2018) (FRSA requires adverse action motivated by discriminatory animus)
- Halliburton, Inc. v. Admin. Rev. Bd., 771 F.3d 254 (5th Cir. 2014) (contrary view: holding retaliatory intent is not an element of §1514A)