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The Recovery Act's Daunting Whistleblower Provisions

By Steven J. Pearlman

The American Recovery and Reinvestment Act of 2009 (the “ARRA”) gives business a financial shot of adrenalin in hopes of stimulating the faltering economy. However, the AARA's sweeping and unprecedented whistleblower provisions in Section 1553 run the risk of engendering attacks on employers that are inconsistent with the ARRA's overarching goals.

This article describes the type of activity Section 1553 protects and the competing burdens parties must bear in pursuing and defending retaliation claims under this statute. It also provides a framework for assessing the risks Section 1553 poses to employers, identifies questions Section 1553 leaves unanswered, and presents the question of whether a few of Section 1553's provisions pass constitutional muster. Finally, this article suggests preventative steps employers should consider in light of the exposure they face under Section 1553.

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