Second Circuit: in-house counsel may not seek to profit as whistleblowers against former employers

By Mark A Nadeau, Laura M Kam and Cole J Schlabach

The US Court of Appeals for the Second Circuit has issued an important ruling restricting in-house counsel from acting as whistleblowers in litigation against their current or former employers.

In United States ex rel Fair Laboratory Practices Associates v Quest Diagnostics Inc et al, the Second Circuit upheld a Southern District of New York ruling dismissing the action and disqualifying the former general counsel of defendant Unilab Corporation, a wholly owned subsidiary of Defendant Quest Diagnostics Inc, as well as his co-relators, the former chairman and chief executive officer and former chief financial officer of Unilab, and their outside counsel, from bringing any subsequent related qui tamaction, on the basis that ’such measures were necessary to prevent the use of [the former general counsel’s] unethical disclosures against defendants’. 

The decision, handed down on 25 October, held that state statutes and rules regulating an attorney’s disclosure of client confidences were not pre-empted by the False Claims Act and that the former general counsel’s decision to ’spill his guts and freely disclose Unilab’s confidential information’ went well beyond anything that was authorised under the crime/fraud exception of the New York Rules of Professional Conduct, making it ’virtually impossible to identify and distinguish each improper disclosure’…

If you are registered and logged in to the site, click on the link below to read the rest of the DLA Piper briefing. If not, please register or sign in with your details below.

Sign in or Register to continue reading this article

Sign in

Register

It's quick, easy and free!

It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.

Register now

Why register to The Lawyer

 

Industry insight

In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.

 

Market intelligence

Identify the major players and business opportunities within a particular region through our series of free, special reports.

 

Email newsletters

Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.

More relevant to you

To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.

Briefings from DLA Piper

View more briefings from DLA Piper

Analysis from The Lawyer

View more analysis from The Lawyer

Overview

3 Noble Street
London
EC2V 7EE
UK
http://www.dlapiper.com

Turnover (£m): 1,566.29
No. of lawyers: 3,961 (UK 200)
Jurisdiction: global
No. of offices: more than 75
No. of qualified lawyers: 625 (International 50)

Jobs