March 4 (Bloomberg) — The U.S. Supreme Court expanded the reach of a federal law enacted in response to the 2001 Enron Corp. collapse, saying it protects people who work for a public company's contractors, including law firms and auditors.
The justices, voting 6-3, allowed whistle-blower claims by two former employees of a privately held company that provides investment advice and management services to the Fidelity mutual funds.
The case centered on protections that watchdog groups and President Barack Obama's administration say are important to prevent another Enron-like catastrophe. The disputed provision is part of the 2002 Sarbanes-Oxley Act.
"Congress installed whistle-blower protection in the Sarbanes-Oxley Act as one means to ward off another Enron debacle," Justice Ruth Bader Ginsburg said in her opinion for the court. "Congress was as focused on the role of Enron's outside contractors in facilitating the fraud as it was on the actions of Enron's own officers."
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