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Exploring Justifications for the Asadi Decision

What kind of whistleblowing should the Dodd-Frank Act protect? In Asadi v. G.E. Energy (USA), L.L.C., the Fifth Circuit held that Dodd-Frank’s antiretaliation provisions extend only to whistleblowers who report information externally, an interpretation of the statute that leaves “internal whistleblowers” unprotected. At first glance, such a ruling, by minimizing protection for whistleblowers, appears likely to result in negative consequences. This Note argues, however, that the Fifth Circuit put forward a rule that not only rests upon a legitimate interpretation of the Dodd-Frank Act but that also may have positive real world consequences. Such consequences, this Note argues, include better channeling of information to the SEC, incentivizing a stronger “tone at the top” within corporations, and minimizing opportunities for corporations to mask wrongdoing.