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Westlaw News

Whistleblower lawyer says SEC pulled 'switcheroo' in payout reduction rule

The head of Labaton Sucharow’s whistleblower practice sued the U.S. Securities and Exchange Commission on Wednesday, seeking to invalidate a recent rule that would let the agency lower whistleblower payouts it deems too large.

Jordan Thomas, represented by Consovoy McCarthy, said in the complaint filed in federal court in Washington, D.C. that the SEC violated the Administrative Procedure Act when it finalized the rule in September. Thomas argues the agency pulled a last-minute “switcheroo,” substituting a publicly proposed rule that would have allowed the agency to decrease future awards to one that applied retroactively, among other changes.

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