John Jones is an internal auditor at Dyetech, a NYSE-listed company engaged in the business of manufacturing

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John Jones is an internal auditor at Dyetech, a NYSE-listed company engaged in the business of manufacturing fabric dying and printing equipment. During one internal audit Jones uncovered what he believed to be evidence that a Dyetech sales official had provided an improper gratuity to a foreign official in exchange for an import license. Jones’ team reported the problem in an internal audit report, but the head of internal audit, Connie Choi, refused to identify the matter as a “critical audit finding” that would be referred to the audit committee of the board of directors. Choi informed Jones that his concerns had been investigated by an outside law firm and found to be unsubstantiated. Jones then approached Choi’s boss, general counsel Mustafa Muhammad, and complained that Choi was refusing to act on information, which, if substantiated, could result in SEC or DOJ enforcement actions or in shareholder lawsuits for failing to disclose material information in SEC filings. Mustafa said he would look into the matter. An hour later Jones received an angry phone call from Choi, who accused him of undercutting her authority. These and other problems caused Jones to experience sleeplessness, anxiety, and depression, requiring psychotherapy and mood-enhancing medication. His frustration came to a head in connection with the internal audit department’s annual summer outing, which Jones was responsible for organizing. Two weeks before the event, Jones discovered that his personal secretary had neglected to book a venue for the event. He exploded in rage, cursing and berating his secretary for her incompetence and unreliability. Five or six other employees observed this event and confirmed that Jones had behaved in an abusive and unprofessional fashion. Jones had never acted this way before. Dyetech’s director of human resources commenced an investigation into the matter and, having concluded that Jones committed a breach of the company’s code of employee conduct, recommended that he be terminated. Jones was fired with two month’s severance pay. Jones files a whistleblower lawsuit under the Sarbanes-Oxley Act. What result?

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