Daniel BERMAN, Plaintiff-Appellant, v. NEO@OGILVY LLC, WPP Group USA, Inc., Defendants-Appellees, 801 F.3d 145

JON O. NEWMAN, Circuit Judge. This appeal presents the recurring issue of statutory

interpretation that arises when express terms in one provision of a statute are arguably in tension with language in another provision of the same statute. The Supreme Court recently encountered a similar issue when it interpreted a provision in the Patient Protection and Affordable Care Act in Burwell v. King, — U.S. -, 135 S.Ct. 2480, 192 L.Ed.2d 483 (2015). In the pending case, the tension occurs within the whistleblower protection provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”). Pub.L. No. 111-203, Title IX, § 922(a), 124 Stat. 1376, 1841 (2010), which added

section 21F to the Exchange Act of 1934, codified at 15 U.S.C. § 78u-6. The relevant administrative agency, the Securities and Exchange Commission (“SEC” or “Commission”), has issued a regulation endeavoring to harmonize the provisions that are in tension. Plaintiff-Appellant Daniel Berman appeals from the December 8, 2014, judgment of the District Court for the Southern District of New York (Gregory H. Woods, District Judge), dismissing on motion for

summary judgment his suit against Defendants-Appellees Neo@Ogilvie LLC and WPP Group USA, Inc. See Berman v. Neo@Ogilvy LLC, 72 F.Supp.3d 404 (S.D.N.Y.2014). We conclude that the pertinent provisions of Dodd-Frank create a sufficient ambiguity to warrant our deference to the SEC’s interpretive rule, which supports Berman’s view of the statute. We therefore reverse and remand for further proceedings. Background The statutory and regulatory provisions.

Section 21F, added to the Exchange Act by Dodd-Frank, is captioned “Securities Whistleblower Incentives and Protection.” 15 U.S.C. § 78u-6. Subsection 21F(

b) provides the incentives by directing the SEC to pay awards to individuals whose reports to the Commission about violations of the securities laws result in successful Commission enforcement actions. See 15 U.S.C. § 78u-6(b). Subsection 21F(

h) provides the protection by prohibiting employers from retaliation against employees for reporting violations. Id. § 78u-6(h). This appeal concerns the relationship between the definition of “whistleblower” in

section 21F and one subdivision of the provision prohibiting retaliation, which was added by a conference committee just before final passage. Subsection 21F(a), the

definitions subsection of

section 21F, contains subsection 21F(a)(6), which defines “whistleblower” to mean “any individual who provides ... information relating to a violation of the securities laws to the Commission .... ” Id. 78u-6(a)(6) (emphasis added). Subsection 21F(h), the retaliation protection provision, contains subsection 21F(h)(l)(A), which provides: (

A) In General No employer may discharge, demote, suspend, threaten, harass, directly or indirectly, or in any other manner discriminate against, a whistleblower in the terms and conditions of employment because of any lawful act done by the whistleblower— (

i) in providing information to the Commission in accordance with this section; (ii) in initiating, testifying in, or assisting in any investigation or judicial or administrative action of the Commission based upon or related to such information; or (iii) in making disclosures that are required or protected under the Sar-banes-Oxley Act of 2002 (15 U.S.C. 7201 et seq.), this

chapter [ie., the Exchange Act], including

section 78j-l(

m) of this title [i.e.,

Section 10A(

m) of the Exchange Act],

section 1513(

e) of Title 18, and any other law, rule, or regulation subject to the jurisdiction of the Commission. Id. 78u-6(h)(l)(A). The Sarbanes-Oxley Act of 2002 (“Sar-banes-Oxley”), Public L. No. 107-204, 116 Stat. 475 (2002), which is cross-referenced by subdivision (iii) of subsection 21F(h)(l)(

A) of Dodd-Frank, includes several provisions concerning the internal reporting of securities law violations or improper practices. For example,

section 307 of Sarbanes-Oxley requires the SEC to issue rules requiring an attorney to report securities law violations to the chief legal counsel or chief executive officer of the company. See 15 U.S.C. § 7245(1).

Section 301 of Sarbanes-Oxley added to the Exchange Act

section 10A(m)(4), requires the SEC by rule to direct national securities exchanges and national securities associations to require audit committees of listed companies to establish internal company procedures allowing employees to submit complaints regarding auditing matters. This

section is not codified.

Section 806(

a) of Sarbanes-Oxley prohibits a publicly traded company from retaliating against an employee who provides information concerning securities law violations to, among other, a federal regulatory or law enforcement agency, a member of Congress, or “a person with supervisory authority over the employee.” 18 U.S.C. § 1514A(a)(l). This appeal concerns the arguable tension between the definitional subsection, subsection 21F(a)(6), which defines “whis-tleblower” to mean an individual who reports violations to the Commission, and subdivision (iii) of subsection 21F(h)(l)(A), which, unlike subdivisions (

i) and (ii), does not within its own terms limit its protection to those who report wrongdoing to the SEC. On the contrary, subdivision (iii) expands the protections of Dodd-Frank to include the whistleblower protection provisions of Sarbanes-Oxley, and those provisions, which contemplate an employee reporting violations internally, do not require reporting violations to the Commission. In statutory terms, the issue presented is whether the “whistleblower” definition in subsection 21F(a)(6) of Dodd-Frank applies to subdivision (iii) of subsection 21F(h)(l)(A).

In operational terms, the issue is whether an employee who suffers retaliation because he reports wrongdoing internally, but not to the SEC, can obtain the retaliation remedies provided by Dodd-Frank. The SEC believes he can. In 2011, using its authority to issue rules implementing

section 21F, see 15 U.S.C. § 78u-6(j), the SEC promulgated Exchange Act Rule 21F-2, 17 C.F.R. § 240.21F-2, which provides: (

a) Definition of a whistleblower.

(1) You are a whistleblower if, alone or jointly with others, you provide the Commission with information pursuant to the procedures set forth in § 240.21F-9(

a) of this chapter, and the information relates to a possible violation of the Federal securities laws (including any rules or regulations thereunder) that has occurred, is ongoing, or is about to occur. A whistleblower must be an individual. A company or another entity is not eligible to be a whistleblower.

(2) To be eligible for an award, you must submit original information to the Commission in accordance with the procedures and conditions described in §§ 240.21F-4, 240.21F-8, and 240.21F-9 of this chapter. (

b) Prohibition against retaliation.

(1) For purposes of the anti-retaliation protections afforded by

Section 21F(h)(

l) of the Exchange Act (15 U.S.C. 78u — 6(h)(1)), you are a whistle-blower if: (

i) You possess a reasonable belief that the information you are providing relates to a possible securities law violation (or, where applicable, to a possible violation of the provisions set forth in 18 U.S.C. 1514A(a)) that has occurred, is ongoing, or is about to occur, and; (ii) You provide that information in a manner described in

Section 21F(h)(l)(

A) of the Exchange Act (15 U.S.C. 78u-6(h)(l)(A)). (iii) The anti-retaliation protections apply whether or not you satisfy the requirements, procedures and conditions to qualify for an award. Echoing

section 21F(a)(6) of Dodd-Frank, subsection 21F-2(a)(

l) of Exchange Act Rule 21F-2 defines a whistleblower as a person who “provide[s] the Commission” with specific information. 17 C.F.R. § 240.21F-2(a)(l). However, subsection 21F-2(

b) of the Rule, headed “Protection against retaliation,” provides, in subdivision 21F — 2(b)(ii) that, for purposes of the retaliation protections of Dodd-Frank, a person is a whistleblower if the person “provide[s]” specified information “in a manner described in” the retaliation protection provisions of Dodd-Frank, which includes the cross-reference in subdivision (iii) to the reporting provisions of Sar-banes-Oxley. Id. § 240.21F-2(b)(ii). Those provisions, as explained above, protect an employee who reports internally without reporting to the Commission.

As the SEC explained in its release accompanying issuance of Exchange Rule 21F-2, “the statutory anti-retaliation protections [of Dodd-Frank] apply to three different categories of whistleblowers, and the third category [described in subdivision (iii) of subsection 21F(h)(l)(A) ] includes individuals who report to persons or governmental authorities other than the Commission.” Securities Whistleblower Incentives and Protections, Release No. 34-64545, 76 Fed.Reg. 34300-01, at *34304, 2011 WL 2293084 (F.R.) (June 13, 2011) (emphasis added).

So the more precise issue in the pending appeal is whether the arguable tension between the definitional

section of subsection 21F(a)(6) and subdivision (iii) of subsection 21(F)(h)(l)(

A) creates sufficient ambiguity as to the coverage of subdivision (iii) to oblige us to give Chevron deference to the SEC’s rule. See Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). The pending lawsuit. Plaintiff-Appellant Daniel Berman was the finance director of Defendant-Appellee Neo@Ogilvy LLC (“Neo”) from October 2010 to April 2013.

He was responsible for Neo’s financial reporting and its compliance with Generally Accepted Accounting Principles (“GAAP”), as well as internal accounting procedures of Neo and its parent, Defendant-Appellee WPP Group USA Inc. (“WPP”). Neo is a media agency that provides a range of digital and direct media services. In January 2014, Berman sued Neo and WPP, alleging that he was discharged in violation of the whistleblower protection provisions of

section 21F of Dodd-Frank and in breach of his employment contract. According to the allegation of the complaint, while employed at Neo, he discovered various practices that he alleged amounted to accounting fraud. He also alleged that these practices violated GAAP, Sarbane's-Oxley, and Dodd-Frank, and that he had reported these violations internally. A senior officer at Neo became angry with him, and he was terminated as a result of his whistleblower activities in April 2013. In August 2013 he reported his allegations to the WPP Audit Committee.

While employed at Neo and for about six months after he was fired, Berman did not report any allegedly unlawful activities to the SEC. In October 2013, after the limitations period on one of his Sarbanes-Oxley claims had ended, he provided information to the Commission. Defendants’ motion to dismiss the complaint was referred to Magistrate Judge Sarah Netburn.

She filed a Report & Recommendation (“R & R”) recommending that Berman was entitled to be considered a whistleblower under Dodd-Frank because of the retaliation protection of subdivision (Hi) of subsection 21F(h)(A)(l), unrestricted by the definition of “whistle-blower” in subsection 21F(a)(6). However, the R & R also recommended that the retaliation claims be dismissed for legal insufficiency, without prejudice to amendment, and that the contracts claims be dismissed with prejudice.

The District Court, disagreeing with the Magistrate Judge, relied on the definition of “whistleblower” in subsection 21F(a)(6) and ruled that subsection 21F(h)(l)(A), including subdivision (iii), provided whistle-blower protection only to those discharged for reporting alleged violations to the Commission. The District Court dismissed the Dodd-Frank claims because Berman had been terminated long before he reported alleged violations to the SEC. The District Court also rejected the contract claims and dismissed the entire complaint. See Berman, 2014 WL 6860583, at *6.

Berman’s appeal challenges only the dismissal of his Dodd-Frank claim. Discussion The statutory

interpretation issue posed by this case is not as stark, and hence not as easily resolved,- as that encountered in somewhat similar cases. In Scialabba v. Cuellar, de Osorio, — U.S. -, 134 S.Ct. 2191, 189 L.Ed.2d 98 (2014), for example, the express language of one clause of a subsection of a statute was contradicted by express language in another clause of the same subsection. See id. at 2207 (“[T]he two halves of [8 U.S.C.] § 1153(h)(8) face in different directions.”)- In Church of the Holy Trinity v.

United States, 143 U.S. 457, 12 S.Ct. 511, 36 L.Ed. 226 (1892), application of the express terms of a statute to the facts of a case yielded a result so unlikely to have been intended by Congress that the Supreme Court did not apply those terms. See id. at 472, 12 S.Ct. 511 (declining to apply to a church’s contract with a British pastor a prohibition on contracting to import an alien to perform labor of any kind). Closer to our case is the issue the Supreme Court recently confronted in Burwell v. King.

There, four words of one provision expressly provided that income tax subsidies were available to those who purchased health insurance on exchanges “established by a state,” and the argument made to the Court was that the operation of the entire statute would be undermined if tax subsidies were not also available to those who purchased health insurance on exchanges established by the federal government. A closely divided Court accepted that argument and interpreted the Affordable Care Act as a whole to provide, income tax subsidies to those who purchased health insurance on federal exchanges. The

interpretation issue facing the Supreme Court in King was far more problematic .than the issue we face here. In King the issue was whether the statutory phrase “established by the State” should be understood to mean “established by the State or by the Federal Government.” In our case, the statutory provision relied on by the Appellees and our dissenting colleague contains the phrase “provide ... to the Commission,” but the issue is not whether that phrase means something other than what it literally says.

Instead, the issue is whether the statutory provision applies to another provision of the statute, or, more precisely, whether the answer to that question is sufficiently unclear to warrant Chevron deference to the Commission’s regulation. In our case there is no absolute conflict between the Commission notification requirement in the definition of “whistle-blower” and the absence of such a requirement in both subdivision (iii) of subsection 21F(h)(l)(

A) of Dodd-Frank and the Sar-banes-Oxley provisions incorporated by subdivision (iii). An employee who suffers retaliation after reporting wrongdoing simultaneously to his employer and to the SEC is eligible for Dodd-Frank remedies and those provided by Sarbanes-Oxley. Subdivision (iii) assures him the latter remedies, and his simultaneous report to the SEC assures him that he will not have excluded himself from Dodd-Frank remedies.

Indeed, it was the possibility of simultaneous complaints to both the employer and the Commission that persuaded the Fifth Circuit to insist that the Commission notification requirement be observed by all employees who seek Dodd-Frank remedies for whistleblower retaliation. See Asadi v. G.E. Energy (USA), L.L.C., 720 F.3d 620, 627-28 (5th Cir.2013).

Although the simultaneous employer/Commission reporting example avoids an absolute contradiction between the Commission reporting requirement of the “whistleblower” definition and subdivision (iii)’s incorporation of Sarbanes-Oxley remedies, a significant tension within subsection 21F nevertheless remains. Applying the Commission reporting requirement to employees seeking Sarbanes-Oxley remedies pursuant to subdivision (iii) would leave that subdivision with an extremely limited scope for several reasons.

First, although there may be some potential whistleblowers who will report wrongdoing simultaneously to their employer and the Commission, they are likely to be few in number. Some will surely feel that reporting only to their employer offers the prospect of having the wrongdoing ended, with little chance of retaliation, whereas reporting to a government agency creates a substantial risk of retaliation. Second, and more significant, there are categories of whistleblowers who cannot report wrongdoing to the Commission until after they have reported the wrongdoing to their employer.

Chief among these are auditors and attorneys. Auditors are subject to subsection 78j — 1 of the Exchange Act, 15 U.S.C. § 78j-l, which is one of the provisions of Sarbanes-Oxley, expressly cross-referenced by subdivision (iii). Subsection 78j-l(b)(l)(

B) requires an auditor of a public company, under certain circumstances, to “inform the appropriate level of the management” of illegal acts, unless they are inconsequential. See 15 U.S.C. § 78j-l(b)(l)(B). Subsection 78j — 1(b)(2) requires an auditor to report to the board of directors if the company does not take reasonable remedial action after the auditor’s report to management. See id. § 78j — 1(b)(2). Significantly to our case, subsection 78j-1(b)(3)(

B) permits an auditor to report illegal acts to the Commission only if the board or management fails to take appropriate remedial action. See id. § 78j-1(b)(3)(B). Thus, if subdivision (iii) requires reporting to the Commission, its express cross-reference to the provisions of Sarbanes-Oxley would afford an auditor almost no Dodd-Frank protection for retaliation because the auditor must await a company response to internal reporting before reporting to the Commission, and any retaliation would almost always precede Commission reporting. Attorneys are subject to both

section 307 of Sarbanes-Oxley, 15 U.S.C. § 7245, and the SEC’s Standards of Professional Conduct (“Attorney Standards”), 17 C.F.R. § 205.1-7, and subdivision (iii) cross-references “any other law, rule, or regulation subject to the jurisdiction of the Commission.” Subsection 7245(1) requires attorneys to report material violations of the securities laws to the chief legal counsel or chief executive officer (“CEO”) of a public company, and subsection 7245(2) requires attorneys to report such violations to the audit or other appropriate committee of the board of directors if the counsel or CEO “does not appropriately respond to the attorney’s internal reporting. 15 U.S.C. §§ 7245(1), (2).

Again significantly to our case, the SEC’s Rule 3 of its Attorney Standards contemplates an attorney reporting to the Commission only after • internal reporting, see 17 C.F.R. § 205.3(d)(2), explicitly recognizing that by reporting internally first an attorney “does not reveal client confidences or secrets or privileged or otherwise protected information related to the attorney’s representation of the issuer,” id. § 205.3(b)(1).

Like auditors, attorneys would gain little, if any, Dodd-Frank protection if subdivision (iii), despite cross-referencing Sarbanes-Oxley' provisions protecting lawyers, protected only against retaliation for reporting to the Commission. Thus, apart from the rare example of simultaneous (or nearly simultaneous) reporting of wrongdoing to an employer and to the Commission, there would be virtually no situation where an SEC reporting requirement would leave subdivision (iii) with any scope.

In light of these realities as to the sharply limiting effect of a Commission reporting requirement on all whistleblowers seeking the Sarbanes-Oxley remedies promised by Dodd-Frank for those who report wrongdoing internally, the question becomes whether Congress intended to add subdivision (iii) to subsection 21F(h)(l)(

A) only to achieve such a limited result. To answer that question we would normally look to the legislative history of subdivision (iii) to learn what Congress, or the relevant committee, had sought to accomplish by adding subdivision (iii). See, e.g., Vincent v. The Money Store, 736 F.3d 88, 101 n. 10 (2d Cir.2013). Unfortunately that inquiry yields nothing. What became subdivision (iii) of subsection 20F(h)(l)(

A) was not in either version of Dodd-Frank that was passed by the House and the Senate prior to a conference. After these versions went to conference, the House Conferees prepared a “conference base text” to serve as the basis for resolution of differences by the Conference Committee. Subdivision (iii) first saw the light of day in that conference base text when it was added to follow subdivisions (

i) and (ii) of subsection 20F(h)(l)(A), both of which had been in the Senate version. Unfortunately, there is no mention of the addition of subdivision (iii), much less its meaning or intended purpose, in any legislative materials — not in the conference report nor the final passage debates on Dodd-Frank in either the House or the Senate. The “Joint Explanatory Statement of the Committee of Conference” explains only that “[t]he subtitle [Subtitle B of Title IX] further enhances incentives and protections for whistleblowers providing information leading to successful SEC enforcement actions.” H. Rep.

No. 111-517, at 870 (2009-10) (Conf.Rep.). Subdivision (iii) is, like Judge Friendly’s felicitous characterization of the Alien Tort Act, “a kind of legal Lohengrin; ... no one seems to know whence it came.” IIT v. Vencap, Ltd., 519 F.2d 1001, 1015 (2d Cir.1975), abrogated on other grounds by Morrison v. National Australia Bank, 561 U.S. 247, 130 S.Ct. 2869, 177 L.Ed.2d 535 (2010). Other courts confronting the issue of whether the arguable tension between subsection 21F(a)(6) and subdivision (iii) of subsection 21F(h)(l)(

A) warrants Chevron deference to Exchange Rule 21F-2 have reached conflicting results. The Fifth Circuit in Asadi, 720 F.3d at 620, and the District Court decision that Asadi affirmed, Asadi v. G.E. Energy (USA), LLC, Civ. Action No. 4:12-345, 2012 WL 2522599 (S.D.Tex. Jun. 28, 2012), both ruled the subsection 21F(a)(6) definition of “whistleblower” controlling. Three other district courts have followed Asadi. See Verfuerth v. Orion Energy Systems, Inc., 65 F.Supp.3d 640, 643-46 (E.D.Wis.2014); Banko v. Apple Inc., 20 F.Supp.3d 749, 756-57 (N.D.Cal.2013); Wagner v.

Bank of America Corp., No. 12-cv-00381-RBJ, 2013 WL 3786643, at *4-*6 (D.Colo. July 19, 2013). On the other hand, a far larger number of district courts have deemed the statute ambiguous and deferred to the SEC’s Rule. See Somers v. Digital Realty Trust, Inc., No. C14-5180 EMC, — F.Supp.3d -,-, 2015 WL 2354807, at *4-12 (N.D.Cal. May 15, 2015); Yang v. Navigators Group, Inc., 18 F.Supp.3d 519, 533-34 (S.D.N.Y.2014); Khazin v. TD Ameritrade Holding Corp. No. 13-4149 (SDWQ)(MCA), 2014 WL 940703, at *3-6 (D.N.J. Mar. 11, 2014); Azim v. Tortoise Capital Advisors, LLC, No. 13-2267-KHV, 2014 WL 707235, at *2-3 (D.Kan.

Feb. 24, 2014); Ahmad v. Morgan Stanley & Co., 2 F.Supp.3d 491, 495-97 n. 5 (S.D.N.Y 2014); Rosenblum v. Thomson Reuters (Mkts.) LLC, 984 F.Supp.2d 141, 146-49 (S.D.N.Y.2013); Murray v. UBS Securities, LLC, No. 12-5914, 2013 WL 2190084, at *4 (S.D.N.Y. May 21, 2013); Ellington v. Giacoumakis, 977 F.Supp.2d 42, 44-46 (D.Mass.2013); Genberg v. Porter, 935 F.Supp.2d 1094, 1106-07 (D.Colo.2013); Nollner v. Southern Baptist Convention, Inc., 852 F.Supp.2d 986, 995 (M.D.Tenn.2012); Kramer v. Trans-Lux Corp., No. 3:11CV1424 SRU, 2012 WL 4444820, at *4 (D.Conn. Sept. 25, 2012); Egan v.

TradingScreen, Inc., No. 10 Civ. 8202, 2011 WL 1672066, at *4-7 (S.D.N.Y. May 4, 2011). Thus, although our decision creates a circuit split, it does so against a landscape of existing disagreement among a large number of district courts.

Like all these courts, we confront both the definition of “whistleblower” in subsection 21F(a)(6), which extends whistleblower protection only to employees who report violations to the Commission, and the language of subdivision (iii), which purports to protect employees from retaliation for making reports required or protected by Sarbanes-Oxley, reports that are made internally, without notification to the Commission. We recognize that the terms of a definitional subsection are usually to be taken literally, see Antonin Scalia and Bryan A.

Garner, “Reading Law,” 227 (2012) (“Ordinarily, judges apply text-specific

definitions with rigor”), and, pertinent to this case, usually applied to all subdivisions literally covered by the definition, but we have also recognized that “mechanical use of a statutory definition” is not always warranted. See In re Air Cargo Shipping Services Antitrust Litigation, 697 F.3d 154, 163 (2d Cir.2012). Scalia and Garner too have stated, “Definitions are, after all, just one indication of meaning — a very strong indication, to be sure, but nonetheless one that can be contradicted by other indications.” Scalia and Garner 228. The issue here, however, is not whether to read the words of the definitional

section literally, but the different issue of whether the definition should apply to a late-added subdivision of a subsection that uses the defined term. In deciding whether sufficient ambiguity exists in Dodd-Frank to warrant deference to the SEC’s Rule, we note, but are not persuaded by, the arguments that any reading would render some language of Dodd-Frank superfluous.

Berman contends that if subdivision (iii) is subject to the Commission reporting requirement by virtue of subsection 21F(a)(6), then most of subdivision (iii) would be superfluous because the Sarbanes-Oxley protections purportedly incorporated would have no effect. The SEC argues that if the definition of “whistleblower” applies to all.three subdivisions of subsection 21F(h)(l)(A), then the Commission reporting requirement, expressly stated in subdivisions (

i) and (ii), would be superfluous. Neo contends that if subdivision (iii) does not require an employee to report violations to the Commission, then the SEC reporting requirement in subsection 21F(a)(6) would be superfluous. All these arguments ignore the realities of the legislative process.

When conferees are hastily trying to reconcile House and Senate bills, each of which number hundreds of pages, and someone succeeds in inserting a new provision like subdivision (iii) into subsection 21F(h)(l)(A), it is not at all surprising that no one noticed that the new subdivision and the definition of “whistleblower” do not fit together neatly. The definition speaks of reporting to the Commission, but subdivision (iii) incorporates Sarbanes-Oxley provisions, which contemplate internal reporting, without reporting to the Commission. Subdivisions (

i) and (ii), which were included in the Senate version of Dodd-Frank before the conferees met, fit precisely with the “whistleblower” definition. Subdivision (

i) explicitly requires reporting “to the Commission,” and subdivision (ii) concerns assisting action “of the Commission,” whereas the terms of subdivision (iii) do neither. When the conferees, at the last minute, inserted subdivision (iii) within subsection 21F(h)(l)(A), did they expect subdivision (iii) to be limited by the statutory definition of “whistleblower” in subsection 21F(a)(6), or did they expect employees to be protected by subdivision (iii) whenever they report violations internally, without reporting to the Commission?

The texts leave the matter unclear, and no legislative history even hints at an answer. Ultimately, we think it doubtful that the conferees who accepted the last-minute insertion of subdivision (iii) would have expected it to have the extremely limited scope it would have if it were restricted by the Commission reporting requirement in the “whistleblower” definition in subsection 21F(a)(6). If we had to choose between reading the statute literally or broadly to carry out its apparent purpose, we might well favor the latter course.

However, we need not definitively construe the statute, because, at a minimum, the tension between the definition in subsection 21F(a)(6) and the limited ..protection provided by subdivision (iii) of subsection 21F(h)(l)(

A) if it is subject to that definition renders

section 21F as a whole sufficiently ambiguous to oblige us to give Chevron deference to the reasonable

interpretation of the agency charged with administering the statute. Unlike the situation confronting the Supreme Court in King, where the agency administering the disputed provision, the Internal Revenue Service, was deemed to lack relevant expertise, King, 135 S.Ct. at 2489, obliging the Court itself to resolve the ambiguity, see id., the SEC is clearly the agency to resolve the ambiguity we face. Therefore, also unlike King, we need not. resolve the ambiguity ourselves, but will defer to the reasonable interpretive rule adopted by the appropriate agency.

Under SEC Rule 21F~2(b)(l), Berman is entitled to pursue Dodd-Frank remedies for alleged retaliation after his report of wrongdoing to his employer, despite not having reported to the Commission before his termination. We therefore reverse and remand for further proceedings. On remand, the District Court will have an opportunity to consider the R & R’s recommendation to dismiss, without prejudice to amendment, for lack of a sufficient allegation of a termination entitled to Dodd-Frank protection, and any other arguments made by the Defendants in support of their motion to dismiss. Reversed and remanded. .

Just recently, on August 4, 2015, the SEC issued a release "to clarify that, for purposes of the employment retaliation protections provided by

Section 2IF of the Securities Exchange Act of 1934 ("Exchange Act”), an individual's status as a whistleblower does not depend on adherence to the reporting procedures specified in Exchange Act Rule 21F-9(a) [specifying procedures to be followed to qualify for a whistleblower award], but is determined solely by the terms of Exchange Act Rule 21F2(b)(l).”

Interpretation of the SEC's Whistleblower Rules Under

Section 21F of the Securities Exchange Act of 1934, SEC Release No. 34-75592, 2015 WL 4624264 (F.R.) (Aug. 4, 2015). . We start by posing the issue as one of statutory construction because Berman sued for violation of Dodd-Frank. If we find the statute ambiguous, we will consider whether the SEC’s regulation is a reasonable

interpretation of the statute warranting Chevron deference. The SEC begins its argument by asserting that " '[t]he

interpretation of a statute by a regulatory agency charged with its administration is entitled to deference if it is a permissible construction of the statute.’ ” Brief for SEC at 17 (citing Haekal v. Refco, Inc., 198 F.3d 37, 41 (2d Cir.1999)). Then the SEC points out that consideration of whether an agency

interpretation is permissible requires two steps: first, considering whether there is an “unambiguously expressed intent of Congress,” Chevron, 467 U.S. at 843, 104 S.Ct. 2778, on "the precise issue in question,” id. at 842, 104 S.Ct. 2778, and, second, if the statute is silent or ambiguous, considering whether the agency's

interpretation is "based on a permissible construction of the statute, id. at 843, 104 S.Ct. 2778. Although our approach and the SEC’s both require initial

interpretation of the statute, the reasons for that inquiry differ. We start with the statute because that is the basis for Ber-man's claim. His complaint does not mention the SEC’s rule. The SEC starts with the statute to determine whether its regulation is entitled to Chevron deference. Chevron, in which the two-step analysis was outlined, was a suit challenging the validity of an agency regulation. . See also Yates v. United States, - U.S. -. 135 S.Ct. 1074, 1079, 191 L.Ed.2d 64 (2015) (declining to apply literal meaning of “tangible object” as used in Sarbanes-Oxley” to a fish); Bond v.

United States, - U.S. -, 134 S.Ct. 2077, 2091, 189 L.Ed.2d 1 (2014) (declining to apply express terms of definition of “chemical weapon” to toxic chemicals spread by a jilted wife on property of her husband’s lover). . We do not doubt that "provide ... to the Commission” means "provide ... to the Commission.” .

By using the Fifth Circuit’s example of “simultaneous” reporting to an employer and to the Commission, we recognize that a literal application of the definition of "whistleblower” to subdivision (iii) would also benefit those who reported to the Commission very soon after reporting to an employer, soon enough to do so before the employer retaliated by discharging the employee for the internal reporting (assuming the employer terminated because of both acts of reporting). .

The full title is "Standards of Professional Conduct for Attorneys Appearing and Practicing Before the Commission in the Representation of an Issuer.” 17 C.F.R. § 205.1. . See footnote 5, supra. . As originally submitted by the Administration on July 22, 2009, the "Financial Services Oversight Council Act of 2009" proposed adding

section 2IF to the Exchange Act. The Administration’s proposal included subsection 21F(g)(l)(A), which entitled an employee to be made whole if discharged “for providing information” as provided elsewhere in the bill. As passed by the House of Representative on Dec. 11, 2009, the "Wall Street Reform and Consumer Protection Act of 2009” also proposed adding

section 2IF to the Exchange Act. The House version of

section 2IF included subsection 21F(g)(l)(A), which prohibited retaliation against an employee for "providing information to the Commission” as provided elsewhere in the bill, and subsection 21F(g)(4), which defined "whistleblower” as one or more individuals "who submit information to the Commission” as provided in

section 21F. See H.R. 4173, 111th Cong., 1st Sess. (2009). As passed by the Senate on May 20, 2010, the "Restoring American Financial Stability Act of 2010” also proposed adding

section 21F to the Exchange Act. The Senate version of

section 21F included subsection 21F(a)(7), which copied the definition of "whistleblower” from H.R. 4173, and included in subsection 21 F(h)( 1 )(

A) the language that would become subdivisions (

i) and (ii) of subsection 21F(h)(l)(

A) of Dodd-Frank. See H.R. 4173, 111th Cong., 2d Sess. (2010). .The dissent chides us for stating that subdivision (iii) protects "employees” from retaliation for reporting violations, pointing out correctly that this subdivision does not use the word "employees.” Dissenting op. [157-58], However, subsection 21F(h)(l)(A), of which subdivision (iii) is a component, prohibits an “employer” from taking adverse action or discriminating against a whistleblower "in the terms or conditions of employment.” Who but “employees” could be discriminated against by an "employer” in the terms and conditions of "employment?” .

"True ambiguity is almost always the result of carelessness or inattention." Scalia and Garner 33. . Subdivision (iii) mentions the Commission only to provide that the protection of (iii) extends to Sarbanes-Oxley disclosures required by any “law, rule, or regulation subject to the jurisdiction of the Commission.” 15 U.S.C. § 78u — 6(h)(1)(A)(iii). .

Or, to put the matter another way, did the conferees deliberately decide to insert subdivision (iii) in subsection 21F(h)(l)(A), knowing it would arguably be subject to the subsection 21F(a)(6) definition of "whistleblower,” rather than add the text of subdivision (iii) elsewhere so that it would not even arguably be subject to that definition?