Geary v. Parexel International Corporation

Background

William John Geary, proceeding without a lawyer, sued Parexel International Corporation and its individual officers, executives, and directors. He alleged four claims: retaliation under the Sarbanes-Oxley Act, retaliation under the Dodd-Frank Wall Street Reform and Consumer Protection Act, retaliation and wrongful termination under California Labor Code § 1102.5, and wrongful termination in violation of public policy.

Geary alleged that, while working as a senior project leader, he reported problems involving revenue recognition and invoices for Parexel projects. He said he was pressured to support overstated revenue and invoices, placed on a performance improvement plan, put on leave, and terminated on June 30, 2015 after refusing to participate in what he believed was wrongdoing. He reported his concerns to the Department of Labor’s Occupational Safety and Health Administration in November 2015 and to the Securities and Exchange Commission in May 2018, although he later told the court that the May 2018 date was a typographical error and that the report occurred in May 2015.

Sarbanes-Oxley claim

The defendants argued that Geary failed to exhaust the required administrative process. OSHA notified him on October 24, 2018, that he had 30 days to object to its findings and request a hearing before an administrative law judge. Geary did not dispute that he failed to do so.

The court held that the preliminary findings therefore became final and could not be reviewed by the district court. It concluded that it lacked subject-matter jurisdiction over the Sarbanes-Oxley claim and dismissed that claim with prejudice, finding that amendment would be futile.

Dodd-Frank claim

The defendants argued that Geary did not qualify as a protected whistleblower because his complaint alleged that he first reported the matter to the SEC in May 2018, nearly three years after his termination. The court explained that a worker must provide information to the SEC before the alleged retaliation to qualify for protection under Dodd-Frank.

Geary argued that the May 2018 date was a typographical error and that he had reported the matter in May 2015. Based on the surrounding allegations, the court accepted that representation for purposes of amendment. It dismissed the Dodd-Frank claim as currently pleaded but granted leave to amend to correct the alleged typographical errors.

The court separately addressed the Dodd-Frank claim against the individual defendants. It found that the complaint did not specifically allege that any individual defendant knew about Geary’s reports or participated in the decision to terminate him. The court granted the motion to dismiss that claim against the individual defendants but allowed Geary to amend by adding specific allegations about each individual defendant’s knowledge and role in the termination.

Wrongful-termination claims

The defendants argued that Geary’s California Labor Code § 1102.5 claim and common-law wrongful-termination claim were barred by the statutes of limitations. The court applied a three-year limitations period to the § 1102.5 claim and a two-year period to the public-policy claim. It determined that both claims accrued when Parexel terminated Geary on June 30, 2015. The deadlines were therefore June 30, 2017, and June 30, 2018, but Geary did not file this federal lawsuit until November 7, 2019.

The court rejected Geary’s argument that his 2015 OSHA complaint paused or preserved the state-law filing deadlines. It explained that submitting a complaint to OSHA was not the equivalent of filing a federal lawsuit. The court dismissed both wrongful-termination claims without leave to amend because amendment would be futile.

Disposition

Judge Edward J. Davila granted the defendants’ motion to dismiss, with limited leave to amend only the Dodd-Frank Act claim. Geary was ordered to file an amended complaint by April 8, 2022.