Cheryl D. Eckard was drug giant GlaxoSmithKline’s (GSK) quality manager. In 2002, she was sent to the company’s primary plant in Puerto Rico to fix problems cited by the U.S. Food & Drug Administration (FDA). Eckard quickly recognized that the company’s premier drug-making facility was a disaster. She recorded and reported to senior managers that the plant’s water system was overcrowded, pills of varying strengths were placed in the same bottles, the warehouse was overcrowded and vans were being used for storage. Eckard complained to company executives and was fired. She proceeded to file a complaint with the FDA. GSK eventually settled for $750 million with the Justice Department, with Eckard receiving more than $96 million from the Federal and State governments for her role as a whistleblower under the False Claims Act.
The Internal Revenue Service, Securities and Exchange Commission and many other government agencies award a percentage of the monies recovered from the violating companies to the whistleblower that provides the information leading to the fine.
A worker who successfully blows the whistle on their companies may receive a large financial reward after a long legal battle. For example, when Laura Davis first reported that her employer, Dialysis Corporation of America (DCA), was overcharging the U.S. government for medicines, co-workers and managers ignored her. When she hired a whistleblower lawyer and sued, her supervisors paid attention to her claims and settled for $7.3 million. Davis’ share of the settlement totaled $1.3 million.
Bradley C. Birkenfeld blew the whistle on the Swiss banking system and revealed how UBS helped hundreds of Americans avoid paying taxes. Birkenfeld’s award was $104 million.
Another advantage of whistleblowing is its effectiveness in controlling corporate crime. In a survey of 5,400 CEOs, CFOs and CCOs conducted by PriceWaterhouseCoopers, results showed that the whistleblowers are the most effective source in combating corporate criminal activity.
One reason that people do not blow the whistle is the fear of losing their livelihood. Whistleblowers undergo a lengthy legal battle that may last years.
Another common consequence of whistleblowing is losing your livelihood. Sherron Watkins, Vice-President for Corporate Development of Enron, illustrates this point. She blew the whistle on Enron’s creative accounting and fraud practices, which led to Enron’s bankruptcy. Watkins insists that she will never be able to work again in corporate America because management is too afraid to have someone like her on their team.
If you believe that you possess evidence of misconduct or fraud conducted by your employer, consult with a Texas whistleblower attorney.