Academic journal article Suffolk University Law Review

Beware the Federal Government Bearing Gifts: How the American Recovery and Reinvestment Act of 2009 Could Become a Whistleblowing Trojan Horse

Academic journal article Suffolk University Law Review

Beware the Federal Government Bearing Gifts: How the American Recovery and Reinvestment Act of 2009 Could Become a Whistleblowing Trojan Horse

Article excerpt

According to legend, it was Odysseus of Ithaca who devised the plan to end the ten-year trojan War by presenting to the trojans a gift in the form of a giant wooden horse. the Greeks left the horse at the gates of troy and apparently sailed away in an act of surrender. the trojans accepted the gift and brought the horse through the gates and into the city. Unbeknownst to the Trojans, a Greek strike force was hidden in the horse. Late that evening, as the Trojans slept, the concealed Greeks slipped out of the horse and opened the gates to the returning Greek army, who torched Troy and ended the devastating war. The lesson, of course, is to be wary of seemingly generous gifts left at your doorstep because, like the Trojan Horse, those gifts may contain the seeds of the recipient's destruction.

The lesson of the Trojan Horse is nowhere more apparent than in the American Recovery and Reinvestment Act of 2009 (the ARRA or the Act), the federal government's $789 billion economic stimulus plan; (1) an apparent "gift" that could have Trojan Horse-like ramifications for its recipients. The reason for this is the ARRA's whistle-blower protection provision. The provision is designed to prevent state and local governments, as well as their contractors (collectively referred to as "covered employers"), from retaliating against employees who disclose gross mismanagement related to stimulus funds; (2) misuse of stimulus funds; (3) substantial and specific dangers to the public related to the implementation of stimulus funds; (4) abuse of authority related to the implementation of stimulus funds; (5) or use of stimulus funds to violate a law, rule or regulation. (6) The ARRA's whistle-blower protection places a very low burden of proof on the employee-plaintiff, (7) a high burden of rebuttal on the employer-defendant, (8) and does not impose a statute of limitations on the claims of employees. Perhaps most critically, the provision does not require that an employee internally report any perceived wrongdoing. (9) Simply put, given the already alarming trends concerning retaliation claims, (10) the ARRA threatens state and local governments with a flood of bad press and potential litigation relating to the use of ARRA funds. ARRA litigation also creates a paradox because state and local governments will be forced to use already scarce resources to defend litigation engendered by an act designed to assist those governments in the height of financial distress.

At first glance, the ARRA offers a windfall for plaintiffs and their attorneys. Because the underlying cause of any lawsuit under the ARRA--disclosure of prohibited conduct--is so broad, nearly anything a goverment employee discloses could be categorized as prohibited conduct. "Gross mismanagement" could presumably encompass any number of ordinarily innocuous actions, especially considering that an employee need only have a reasonable belief that gross mismanagement has occurred. (11) What constitutes a "substantial and specific danger to public health or safety" is unclear. Furthermore, it is left to speculation whether an employee must have an objective reasonable belief or a subjective reasonable belief that an employer has engaged in wrongdoing.

Such issues are just a few of those employers will face as they try to deal with potential ARRA disclosures, whether those disclosures are made internally or externally. Fortunately, the ARRA's whistle-blower provision is written almost identically to the Federal Whistleblower Protection Act (WPA), which protects federal employees who disclose the prohibited practices of "gross mismanagement, a gross waste of funds, an abuse of authority, or a substantial and specific danger to public health or safety." (12) It is a well-settled maxim of statutory interpretation that courts "interpret similar language in different statutes in a like manner when the two statutes address a similar subject matter." (13) Therefore, case law interpreting WPA provides a potential blueprint for interpreting the ARRA that may give employers a roadmap in defending potential ARRA lawsuits. …

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