Forty-five government entities are now joining whistleblower John Hendrix’s suit against JM Eagle. The suit alledges that the largest PVC pipe manufacturer committed fraud by intentionally selling pipe to governments, where the company’s internal quality controls showed 50 to 80 percent failure rates.
1. What was Hendrix’s position with the firm and what did the company alledgedly ask him to do to coverup the faulty pipes?
2. When and where were the catastophic pipe breaks?
3. Do you think that this type of whistleblower suit/protection is covered under the Sarbanes Oxley Act?
4. Assume that entities and Mr. Hendrix are successful in their suits against JM Eagle. Detail what types of expenses should they seek damages for.
Attkisson, S. (2012). Giant plastic water pipe maker accused of fraud, CBS News.com, Oct. 6 (Retrievable online at http://www.cbsnews.com/8301-33816_162-57527339/giant-plastic-water-pipe-maker-accused-of-fraud/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+CBSNewsGamecore+(GameCore%3A+CBSnews.com)
CBS News Video. (2012). JM Eagle Biggest Pipe Manufacture On The Planet Accused Of Fraud By Whistleblower, Oct. 6 (Retrievable online at http://www.youtube.com/watch?v=4rldurzvtl0)