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Clinic Students Win Third Circuit Case on Behalf of Whistleblower

Adam Bluestein and Sydney Melillo, '19

August 07, 2019

The U.S. Court of Appeals for the Third Circuit handed students from the Federal Litigation and Appeals Clinic a victory on Aug. 6, reviving a whistleblower’s claim against Citigroup.

The court ruled that Abdul Jaludi, who was fired by Citigroup, need not resolve his claim that the company violated the anti-retaliation provisions of the 2002 Sarbanes Oxley Act through arbitration.

That was precisely the argument made by ‘19 graduates Adam Bluestein and Sydney Melillo, who had taken the case under the supervision of Professor Richard Frankel while they were enrolled in the clinic.

Bluestein and Melillo argued the case before Third Circuit judges on June 4, facing off against attorneys from Morgan Lewis who represented Citigroup.

Jaludi, who had risen through the Citigroup ranks from entry-level tape operator to head of Enterprise Systems Management for North America, was demoted and ultimately fired in 2013 after raising concerns that the company was not consistently complying with federal requirements to report serious problems that could affect customers to the Office of the Comptroller of the Currency.

While denying that Jaludi was fired in retaliation, Citigroup contended that he must resolve his Sarbanes Oxley claim and a second claim he filed under the Racketeer-Influenced and Corrupt Organizations Act through arbitration, citing the company’s employment handbook.

Bluestein and Melillo argued that neither the Dodd-Frank Act of 2010 nor Citigroup’s employment policies implemented after its enactment required Jaludi to resolve his dispute through mandatory arbitration.

Although the court also ruled that Jaludi must arbitrate the RICO allegation, the students had not argued on that point.

“Mr. Jaludi will receive the day in court that he deserves, and that he should have received a long time ago,” Frankel said. “This case highlights the outstanding work performed by Sydney and Adam, who spent countless hours researching, briefing and arguing the appeal.”

The case represents the second victory for Bluestein and Melillo, who won asylum in April for a Ghanaian man who faced death threats in his home country.