On August 15, 2014, in Van Asdale v. International Game Technology, the US Court of Appeals for the Ninth Circuit ruled in a case of first impression that the postjudgment interest rate in Sarbanes-Oxley whistleblower cases is governed by 28 U.S.C. § 1961 (No. 11–-16538, (9th Cir. Aug. 15, 2014)).

Having won a jury verdict in the district court, the Van Asdales filed a motion for fees and postjudgment interest seeking interest at a rate in accordance with 26 U.S.C. § 6621, which governs the determination of interest rates for underpayment of federal taxes. International Game Technology opposed the motion, arguing that 28 U.S.C. § 1961, which defines the default rate of interest in civil cases in federal district court, should apply instead.

The court, noting that this was a case of first impression for both the Ninth Circuit and all other circuits, invited the U.S. Secretary of Labor to express his views on which interest rate should apply to fee awards in Sarbanes-Oxley whistleblower cases. In the Secretary's view, 28 U.S.C. § 1961 governs postjudgment interest calculations in cases involving district court judgments.

Giving deference to the Secretary's opinion, the court agreed and noted that nothing within the Sarbanes-Oxley Act says otherwise. The court found the Secretary's reasoning to be consistent with the statutory language of the Act and found that the interest rate established in 28 U.S.C. § 1961 is sufficient to make the Van Asdales whole.

Practitioners should be aware that the courts likely will apply the interest rate prescribed in 28 U.S.C. § 1961 to postjudgment interest in Sarbanes-Oxley whistleblower cases.