Genberg v. Porter

FILED
United States Court of Appeals
PUBLISH Tenth Circuit
UNITED STATES COURT OF APPEALS February 22, 2018
Elisabeth A. Shumaker
FOR THE TENTH CIRCUIT Clerk of Court
_________________________________
CARL GENBERG,
Plaintiff - Appellant,
v. No. 16-1368
STEVEN S. PORTER,
Defendant - Appellee,
and
JEFFREY SPERBER; AL
BAUTISTA; CHERYL HOFFMAN-
BRAY; MICHELE DARNAUD;
PHILIPPE GASTONE,
Defendants.
------------------------------
NATIONAL WHISTLEBLOWER
CENTER,
Amicus Curiae.
_________________________________
Appeal from the United States District Court
for the District of Colorado
(D.C. No. 1:11-CV-02434-WYD-MEH)
_________________________________
Clayton E. Wire, Ogborn Mihm LLP, Denver, Colorado (James E. Fogg,
Ogborn Mihm LLP, Denver, Colorado, with him on the briefs), for
Plaintiff-Appellant.
Robert Reeves Anderson, Arnold & Porter Kaye Scholer LLP, Denver,
Colorado (Edwin P. Aro, Holly E. Sterrett, Jenna L. Goldstein, Jamen E.
Tyler, Arnold & Porter Kaye Scholer LLP, Denver, Colorado, on the
briefs), for Defendant-Appellee.
Stephen M. Kohn, Kohn, Kohn & Colapinto, LLP, Washington, D.C., for
Amicus Curiae.
_________________________________
Before HARTZ, HOLMES, and BACHARACH, Circuit Judges.
_________________________________
BACHARACH, Circuit Judge.
_________________________________
This appeal grew out of the firing of Mr. Carl Genberg, an executive
for Ceragenix Corporation. Mr. Genberg allegedly suspected misconduct by
Ceragenix’s Board of Directors. When he acted on these alleged
suspicions, he was fired.
Mr. Genberg then sued Ceragenix’s Chief Executive Officer, Mr.
Steven Porter, for
 retaliation under the Sarbanes-Oxley Act of 2002 and
 defamation under Nevada law.
The district court granted summary judgment to Mr. Porter on both
claims. We reverse on the Sarbanes-Oxley claim and affirm on the
defamation claim.
I. Mr. Genberg battles the Board.
The action arose from a dispute between Mr. Genberg and the Board.
2
A. A merger results in a proxy for Ceragenix’s new
shareholders.
In 2005, Mr. Porter and Mr. Genberg worked for a company that
merged into Ceragenix. This merger entitled shareholders of the old
company to shares in Ceragenix. With the merger, the shares went into
escrow and the Ceragenix Board obtained a proxy to exercise voting rights
for the escrowed shares. The new shareholders, including Mr. Genberg,
believed that the shares would soon be distributed. But Board members
continued to use the proxy for roughly five years, reelecting themselves
and increasing their own compensation.
B. Mr. Genberg ghostwrites an email for a Ceragenix
shareholder.
Objecting to continued use of the proxy, Mr. Genberg drafted an
email under the name of one of Ceragenix’s largest shareholders. The
email urged the Ceragenix Board to abandon the proxy and allow the
shareholders to exercise their own voting rights. When Mr. Genberg
drafted this email, the shareholder was part of a group trying to take
control of Ceragenix, a move opposed by the Ceragenix Board. The
shareholder sent Mr. Genberg’s email to the Ceragenix Board on March 2,
2010.
C. The Board considers the email the next day.
On March 3, the Board met to address the email and suspicion about
Mr. Genberg’s role. At this meeting, Mr. Porter told the Board that the
3
email had been written by Mr. Genberg to aid another company’s attempt
to buy Ceragenix. Mr. Porter viewed Mr. Genberg as disloyal, suspecting
him of helping the group to seize control of Ceragenix. Similar suspicions
led other Board members to suggest that Mr. Genberg be fired. But Mr.
Porter thought that the firing would need to wait because Mr. Genberg was
actively engaged in fundraising efforts. In the meantime, the Board
demanded that Mr. Genberg stop communicating with the shareholder who
had sent the March 2 email.
D. Mr. Genberg accuses Mr. Porter of insider trading.
On March 4, Mr. Genberg sent an email to a Board member, accusing
Mr. Porter of insider trading. In response, the Board hired an attorney to
investigate
 the allegations of insider trading and
 Mr. Genberg’s relationship with the group attempting to
acquire Ceragenix.
Though the attorney found no evidence of insider trading, he did confirm
that Mr. Genberg had been involved in the effort to acquire Ceragenix.
E. The Board fires Mr. Genberg, and Mr. Porter tells others of
the firing.
In response, the Board fired Mr. Genberg for cause. Afterward, Mr.
Porter reported the firing to a public-relations consultant and two
Ceragenix lenders. In these reports, Mr. Porter made four statements about
Mr. Genberg that he regards as defamatory:
4
1. He had acted as “the Judas in house” who facilitated “a hostile
takeover.”
2. He had been terminated “for cause” and for “willful breach of
fiduciary loyalty.”
3. He had lacked any prior experience but was “a shit disturber
deluxe.”
4. He had been “an inside man” who “went over the line.”
Mr. Porter also filed a document with the SEC stating that Mr. Genberg
had been terminated “for cause.”
II. Standard of Review
We review de novo the district court’s grant of summary judgment,
applying the summary-judgment standard stated in Federal Rule of Civil
Procedure 56. ClearOne Comms. v. Nat’l Union Fire Ins., 494 F.3d 1238,
1243 (10th Cir. 2007). Under this standard, summary judgment is
appropriate if the evidence shows that “there is no genuine issue as to any
material fact” and the party moving for summary judgment is entitled to
judgment as a matter of law. Fed. R. Civ. P. 56(c).
On an appeal from a grant of summary judgment, we draw all
reasonable factual inferences in favor of the non-moving party. ClearOne
Comms., 494 F.3d at 1243. A party is thus entitled to summary judgment if
the evidence points only one way and no reasonable inferences could
support the non-moving party’s position. Auraria Student Housing at the
5
Regency v. Campus Village Apartments, 843 F.3d 1225, 1247 (10th Cir.
2016).
III. The Sarbanes-Oxley Claim
Congress passed the Sarbanes-Oxley Act to “protect investors by
improving the accuracy and reliability of corporate disclosures.” Sarbanes-
Oxley Act of 2002, Pub. L. No. 107-204, 116 Stat. 745, 745. To further
this goal, the Act protects whistleblowing employees of publicly traded
companies who tell superiors about a violation of federal securities law. 18
U.S.C. § 1514A. The Act supplies this protection by allowing suit against a
publicly traded company or its officers for retaliation. Id.
For a prima facie case of retaliation, a plaintiff must show that
 he or she engaged in protected activity,
 the employer knew of the protected activity,
 the plaintiff suffered an unfavorable employment action, and
 the protected activity was a factor that contributed to the
unfavorable employment action.
Lockheed Martin Corp. v. Admin. Review Bd., U.S. Dep’t of Labor, 717
F.3d 1121, 1129 (10th Cir. 2013). If a prima facie case is shown, the
defendant can assert a statutory defense known as the “same-action
defense.” Id. at 1130 n.3. This defense requires proof by “clear and
convincing evidence” that the same action would have been taken even
without the protected activity. Id.6
Mr. Genberg’s statutory claim is premised on two separate acts of
protected activity: (1) ghostwriting the March 2 email about proxies and
(2) writing the March 4 email that accused Mr. Porter of insider trading.
Mr. Porter admits that writing the March 4 email constituted protected
activity, but he argues that
 the March 2 email did not involve protected activity,
 Mr. Genberg’s protected activity did not contribute to his
firing, and
 the same-action defense applies.
A reasonable factfinder could view both of Mr. Genberg’s emails as
protected under Sarbanes-Oxley. Thus, we need not parse which email led
to his firing: it is enough under the statute and the summary-judgment
standard that a reasonable factfinder could regard either email as a factor
contributing to the firing. In addition Mr. Porter forfeited the same-action
defense, and a reasonable factfinder could conclude that Mr. Porter had not
shown that the Board would have fired Mr. Genberg in the absence of
protected activities. These conclusions lead us to reverse the grant of
summary judgment to Mr. Porter on the Sarbanes-Oxley claim.
A. A factfinder could reasonably regard the writing of both
emails as protected activity.
Mr. Genberg’s activities consisted of writing two emails in early
March 2010. The first email was sent to the Board on March 2, and the
second one was sent on March 4.
7
The March 4 email accused Mr. Porter of giving inside information to
a stockholder to rig the price of Ceragenix shares. Mr. Porter admits that
writing this email constituted protected activity under Sarbanes-Oxley. 1
The March 2 email demanded that the Ceragenix Board transfer
proxy voting rights to the shareholders. The Board had come to control the
proxy rights in November 2005. When receiving the email, the Board had
controlled the proxy rights for roughly five years. The email stated that it
was “neither fair, just [n]or equitable” for the Ceragenix Board to “retain
the voting power over these shares for [five] years and use such power to
re-elect the members of the Board of Directors without any consideration
for the interests of investors.” Appellant’s App’x Vol. 4 at 877. This
retention of voting power, the email argued, clashed with SEC policies of
“sound corporate governance and shareholder accountability.” Id. at 879.
The district court concluded that writing the March 2 email was not
protected activity, reasoning that the email had not “‘definitively and
substantively’” related to a violation of law. Appellant’s App’x Vol. 7 at
1335 (quoting Fraser v. Fiduciary Trust Co., No. 04 Civ. 6958(PAC), 2009
WL 2601389, at *5 (S.D.N.Y. Aug. 25, 2009)). In drawing this conclusion,
the court pointed out that the March 2 email had not cited a specific SEC
1
Mr. Porter makes this admission solely for purposes of summary
judgment.
8
rule. This omission led the district court to conclude that the email had not
involved protected activity.
The district court applied the wrong standard to determine whether
the March 2 email had involved protected activity. Under the proper
standard, a factfinder could reasonably characterize writing the March 2
email as protected activity.
1. The district court’s “definitive and specific” standard is no
longer applicable.
The district court stated that the March 2 email was protected only if
Mr. Genberg had specifically identified the rule being violated. This
statement of the burden was incorrect, for the Administrative Review
Board of the Department of Labor has “explicitly disavowed the ‘definitive
and specific’ evidentiary standard.” Lockheed Martin Corp. v. Admin.
Review Bd., U.S. Dep’t of Labor, 717 F.3d 1121, 1132 n.7 (10th Cir. 2013).
And the Administrative Review Board’s interpretation of Sarbanes-Oxley
is subject to Chevron deference. Id. at 1131.
Under Chevron deference, we follow the Administrative Review
Board’s interpretation if it is based on a permissible construction of an
ambiguous statute. Id. And this construction of the Sarbanes-Oxley Act is
permissible because of ambiguity in the statutory text. See West v. Lynch,
710 F.3d 121, 129-31 (3d Cir. 2013) (applying Chevron deference to the
9
Administrative Review Board’s rejection of the “definitive and specific”
evidentiary standard).
Mr. Porter admits that the “definitive and specific” test no longer
applies. 2 But he contends that the district court applied the correct
standard. We disagree. The district court noted that Mr. Genberg’s
allegations in the email had not been specific and had failed to
“specifically refer to any of the six enumerated laws” in the Sarbanes-
Oxley Act. Appellant’s App’x Vol. 7 at 1337. This lack of specificity led
the district court to conclude that Mr. Genberg had no “reasonable belief
that any specific SEC rule or regulation was being violated.” Id. (emphasis
added). In light of this conclusion and the rationale, we conclude that the
district court used the obsolete “definitive and specific” standard.
2. Applying the correct standard, a factfinder could
reasonably conclude that writing the March 2 email had
entailed a protected activity.
In Sylvester v. Parexel International, the Administrative Review
Board stated the correct standard for a protected activity: “[T]he [plaintiff]
need only show that he or she ‘reasonably believes’ that the conduct
complained of constitutes a violation of the laws listed” in the Sarbanes-
2
For purposes of the appeal, Mr. Porter “does not dispute that the
Administrative Review Board . . . has ‘explicitly disavowed the “definitive
and specific” evidentiary standard for Sarbanes-Oxley complaint,’ and that
numerous circuits have since rejected this standard.” Appellee’s Resp. Br.
at 26 n.9.
10
Oxley Act. No. 07-123, 2011 WL 2517148, at *11 (Admin. Rev. Bd., U.S.
Dep’t of Labor May 25, 2011). As noted above, we accord Chevron
deference to the Administrative Review Board’s interpretation of the
statutory standard. See Lockheed Martin Corp. v. Admin Review Bd., U.S.
Dep’t of Labor, 717 F.3d 1121, 1132 n.7 (10th Cir. 2013). In light of the
need for deference, the only four circuits to address the issue have
followed Sylvester’s articulation of the standard. Beacom v. Oracle Am.,
825 F.3d 376, 380 (8th Cir. 2016); see also Rhinehimer v. U.S. Bancorp
Investments, 787 F.3d 797, 808-09 (6th Cir. 2015) (“Indeed, we have not
found a decision by a federal court of appeals that considers and rejects the
reasoning in Sylvester.”). And here, Mr. Porter has not questioned the need
to defer to the Administrative Review Board’s articulation of the standard.
The Sylvester standard contains subjective and objective components.
Under the subjective component, the employee “must actually believe” that
the conduct raised in the communication is unlawful. Lockheed, 717 F.3d
at 1132. Under the objective component, the belief must be reasonable. Id.
Thus, writing the March 2 email would constitute a protected activity if
 Mr. Genberg had actually believed that the Board’s retention of
the proxy “constituted a violation of relevant law” and
 a reasonable person might adhere to the same belief.
Mr. Porter’s appeal brief mentions both the objective and subjective
components of the Sylvester standard. But his arguments challenge only the
11
subjective component (Mr. Genberg’s actual belief that the Board violated
an SEC rule by retaining the proxy); Mr. Porter makes no meaningful
arguments regarding whether such a belief would have been reasonable.
Thus, we focus on the subjective component.
The March 2 email
 accused the Board of holding onto the proxy for “years longer
than was ever contemplated” and
 argued that the Board had “deprived [the shareholders] of any
voice in the management of Ceragenix.”
Appellant’s App’x Vol. 4 at 879. Mr. Genberg defends this accusation
based in part on SEC Rule 14a-4(d)(2). This rule states that “[n]o proxy
shall confer authority . . . [t]o vote at any annual meeting other than the
next annual meeting . . . .” 17 C.F.R. § 240.14a-4(d)(2).
Mr. Genberg stated under oath that he had believed that the
Ceragenix Board was violating SEC Rule 14 by continuing to rely on the
initial proxy. 3 Though Mr. Porter challenges the truth of Mr. Genberg’s
3
The concurrence/dissent’s critical reading of the March 2 email
requires too much under the Sylvester standard. The concurrence/dissent
cites opinions on the need to avoid litigation over “sham” affidavits, but
Mr. Genberg had no obligation to explain the omission of a citation to
federal securities law in his March 2 email.
The opinions cited in the concurrence/dissent do not involve an issue
like this one. Kendrick v. Penske Transportation Services concerned the
common-sense rule that affidavits contradicting earlier sworn testimony
cannot create “‘sham fact issue[s].’” 220 F.3d 1220, 1223 n.2 (10th Cir.
2000) (quoting Franks v. Nimmo, 796 F.2d 1230, 1237 (10th Cir. 1986)).
12
sworn statement, the credibility of the statement cannot be resolved on
summary judgment. See Jaxon v. Circle K Corp., 773 F.2d 1138, 1140 n.2
(10th Cir. 1985) (“Credibility disputes are particularly inappropriate for
summary judgment disposition, especially those involving the affidavit of
an interested party concerning facts known only to him.”). A reasonable
factfinder could conclude that Mr. Genberg was telling the truth when he
stated under oath that he had regarded retention of the proxy as a violation
of Rule 14. The reasonableness of that factual finding prevents summary
judgment on the subjective requirement. See Sylvester, 2011 WL 2517148,
at *12 (requiring that the employee actually believe that the employer was
in violation of the law). 4
Mr. Porter points out that the email acknowledged that the Board was
not violating a particular SEC rule. But a reasonable factfinder could
conclude that this part of the email was discussing a different issue. There
Mr. Genberg was apparently addressing the purpose of SEC Rule 452,
Mr. Genberg had no earlier sworn testimony to contradict, and his affidavit
did not conflict with the March 2 email. The other cited opinion, Hexcel
Corp. v. Ineos Polymers, stated only that conclusory allegations cannot
defeat summary judgment. 681 F.3d 1055, 1063-64 (9th Cir. 2012). This
proposition does not apply here, for Mr. Genberg’s Sarbanes-Oxley claim
is governed by the Sylvester rule. This rule did not require Mr. Genberg to
include a citation to the underlying rule in his March 2 email.
4
Mr. Genberg also allegedly believed that the Board had violated
other SEC rules and Delaware law. We need not address these allegations.
13
which governed proxy voting rules for shares held in street names voted by
brokers. The requirements in Rule 452 are distinct from those in Rule 14.
The district court relied not only on the discussion apparently
involving Rule 452 but also on Mr. Genberg’s sophistication in the
industry, suggesting that Mr. Genberg didn’t truly believe that the Board
was violating a particular SEC rule. Otherwise, why wouldn’t he have
referred to SEC Rule 14 in the email?
But a factfinder might reasonably conclude that there was little need
for Mr. Genberg to name the rule, for it seems to clearly bar use of a proxy
for shareholder votes after the next annual meeting. 17 C.F.R. § 240.14a-
4(d)(2). In light of Rule 14, a factfinder might reasonably conclude that
Mr. Genberg believed that the Board was violating the SEC rule.
* * *
This conclusion would require the court to consider the writing of the
March 2 email as a protected activity. As noted above, Mr. Porter does not
question satisfaction of the objective requirement (the reasonableness of
Mr. Genberg’s belief). And a factfinder could reasonably conclude that Mr.
Genberg had believed that continued use of the proxy would violate SEC
Rule 14.
14
B. A genuine factual dispute existed on whether the emails had
contributed to the firing.
Mr. Porter contends that neither email had contributed to Mr.
Genberg’s termination. In our view, however, a reasonable factfinder could
conclude that both emails had contributed to the termination.
The fourth element of the statutory claim is that the protected
activity contributed to Mr. Genberg’s termination. Lockheed Martin Corp.
v. Admin. Review Bd., U.S. Dep’t of Labor, 717 F.3d 1121, 1129 (10th Cir.
2013). This element is “broad and forgiving,” requiring the plaintiff to
point to “‘any factor’” that “‘tends to affect in any way the outcome of the
decision.’” Id. at 1136 (emphasis in original) (quoting Klopfenstein v. PCC
Flow Techs., No. 04-149, 2006 WL 3246904, at *13 (Admin. Rev. Bd.,
U.S. Dep’t of Labor May 31, 2006)). The contributing factor need not be
“‘significant, motivating, substantial, or predominant.’” Id. (internal
quotation marks omitted) (quoting Klopfenstein, 2006 WL 3246904, at
*13).
1. A reasonable factfinder could conclude that the March 2
email had contributed to Mr. Genberg’s termination.
The sequence of events supports Mr. Genberg’s argument that the
March 2 email contributed to his termination. Reacting to the email, the
Board took less than a month to begin an investigation, finish it, and fire
Mr. Genberg. See Lockheed, 717 F.3d at 1136 (“Temporal proximity
15
between the protected activity and adverse employment action may alone
be sufficient to satisfy the contributing factor test.”).
In fact, Mr. Porter argues that the Board decided to fire Mr. Genberg
on March 3, only one day after receiving Mr. Genberg’s email: “The
undisputed evidence establishes that the Board decided on March 3 that
they needed to fire Genberg, but wanted to temporarily delay his firing
until Ceragenix secured the capital it needed to survive.” Appellee’s Resp.
Br. at 17; accord id. at 43 (arguing that the Board agreed on March 3 that
Mr. Genberg “should be fired at a later date”).
Mr. Porter argues that the Board fired Mr. Genberg in part because
he had concealed his role in the March 2 email. According to Mr. Porter,
the Board did not act because of anything that Mr. Genberg had said in the
email, pointing out that Mr. Genberg had raised similar concerns in
February 2010. But the factfinder had no obligation to credit Mr. Porter’s
focus on “concealment” or Mr. Genberg’s prior expression of concern. The
16
factfinder could reasonably conclude that Mr. Genberg had been fired
because of what he had said. After all, Mr. Porter does not suggest that Mr.
Genberg had lied about his role in drafting the email. And Mr. Genberg had
expressed concern in February 2010 to a different Board member (Mr. Jeff
Sperber), not Mr. Porter. Thus, Mr. Porter’s alternative explanations for
the firing do not justify summary judgment.
2. Mr. Porter cannot avoid liability based on a “legitimate
intervening event.”
On March 4, Mr. Genberg also sent a second email to a Board
member, alleging that Mr. Porter had leaked inside information to a
stockholder to aid efforts to rig the price of Ceragenix stock. Mr. Porter
admits (for purposes of summary judgment) that this email constituted
protected activity. But he denies that this email contributed to the
termination. Instead, Mr. Porter attributes the firing to a legitimate
intervening event: the investigator’s determination that Mr. Genberg had
breached a fiduciary duty to Ceragenix. See Feldman v. Law Enforcement
Assocs., 752 F.3d 339, 348-49 (4th Cir. 2014) (discussing how an
intervening event can prevent consideration of protected activity as a
significant cause of the termination). We disagree.
To rely on a legitimate intervening event, the adverse action cannot
be inextricably intertwined with the protected activity; therefore, Mr.
Porter needed to explain Mr. Genberg’s termination “without reference to
17
[his] protected activity.” Palmer v. Canadian Nat’l Ry./Ill. Cent. R.R., No.
16-035, 2016 WL 5868560, at *34 (Admin. Rev. Bd., U.S. Dep’t of Labor
Sept. 30, 2016). Mr. Porter did not satisfy this burden. Ceragenix began to
investigate Mr. Genberg only after he had written the two emails, and we
have already held that a reasonable factfinder could regard the writing of
both emails as protected activity.
If we take away both emails, Ceragenix would never have had a
reason to investigate Mr. Genberg. Therefore, a reasonable factfinder could
conclude that Mr. Genberg’s protected activities on March 2 and 4 were
inextricably intertwined with his termination. See id. at *34-35 (stating
that if the protected activity had led the employer to investigate a possible
rule violation and then fired the employee for violating the rule, “the
protected activity . . . would be ‘inextricably intertwined’ with the adverse
action”). And if the investigation was inextricably intertwined with
protected activities, we could not regard the investigation as an
“independent” cause for the termination. See id. Thus, Mr. Porter cannot
avoid liability based on a legitimate intervening event.
3. A reasonable factfinder could conclude that Mr. Genberg
would not have been fired in the absence of a protected
activity.
Mr. Porter also invokes the same-action defense. This defense allows
the defendant to prevail by submitting clear and convincing evidence that
the employee would have been fired even without the protected conduct.
18
Lockheed Martin Corp. v. Admin. Review Bd., U.S. Dep’t of Labor, 717
F.3d 1121, 1129 n.3 (10th Cir. 2013). Mr. Porter forfeited this defense, and
it would not justify summary judgment even if the issue had been
preserved.
Mr. Porter did not assert this defense either in his Answer 5 or in his
summary-judgment briefs. Mr. Porter points out that he argued that Mr.
Genberg’s protected activity had not contributed to his termination and
asserts that this argument was sufficient to preserve his same-action
defense. We disagree. The “contributing factor” inquiry considers
everything that took place and requires the employee to prove that the
protected activity was taken into account as a reason for the firing. In
contrast, the same-action defense requires the employer to show that it
would have taken the same action even if there had never been a protected
5
Mr. Porter’s Answer appears to expressly disavow the relevance of
the same-action defense:
120. Once a Plaintiff has established a prima facie case, then
. . . the employer [must] demonstrat[e] by clear and convincing
evidence that it would have taken the same adverse employment
action in the absence of the plaintiff’s protected activity.
RESPONSE: Paragraph 120 states Plaintiff’s own legal
analysis and thus no response is required; denied to the extent
this allegation is contrary to the plain language of [the
Sarbanes-Oxley Act] and relevant case law; otherwise denied
that this has any relevance to Porter’s actions.
Appellants’ App’x Vol. 3 at 658 (citation omitted) (second emphasis
added)
19
activity. See Palmer v. Canadian Nat’l Ry./Ill. Cent. R.R., No. 16-035,
2016 WL 5868560, at *12 (Admin. Rev. Bd., U.S. Dep’t of Labor Sept. 30,
2016) (explaining this difference between the two inquiries); see also
Formella v. U.S. Dep’t of Labor, 628 F.3d 381, 389 (7th Cir. 2010)
(distinguishing the “contributing factor” inquiry and the same-action
defense).
Application of the two tests would entail different inquiries. Under
the “contributing factor” inquiry, the question is whether the content of
Mr. Genberg’s communications had been a factor in his termination. But
under the same-action defense, the court would consider what would have
happened if Mr. Genberg had never written either email: No one would
have been investigating Mr. Genberg, so the Board would never have
known that Mr. Genberg had done anything wrong. Thus, Mr. Porter’s
challenge in district court on the “contributing factor” element did not
preserve reliance on the same-action defense.
But let’s assume, for the sake of argument, that this defense was
preserved. Even with this assumption, Mr. Porter could not justify the
award of summary judgment. To prevail on this defense, Mr. Porter needed
to show that Mr. Genberg would have been fired even if he had not written
either email. Mr. Genberg might have been fired even if he had not written
either the March 2 or March 4 email. But that possibility does not entitle
Mr. Porter to summary judgment on the Sarbanes-Oxley claim.
20
On this issue, a reasonable factfinder could have gone either way.
The March 2 email led the Board to conclude that Mr. Genberg could be
terminated “for cause,” and Mr. Porter acknowledges that the Board
decided to fire Mr. Genberg on March 3 based on his email one day earlier.
In addition, the March 4 email led the Board to order an investigation that
ultimately confirmed Mr. Genberg’s role in the March 2 email. The Board
purported to rely on this confirmation to fire Mr. Genberg. Thus, it is
unclear whether the Board would have fired Mr. Genberg absent the March
2 and March 4 emails. In light of this uncertainty, Mr. Porter could not
obtain summary judgment even if he had preserved the same-action
defense.
* * *
The district court granted summary judgment to Mr. Porter on Mr.
Genberg’s Sarbanes-Oxley claim. We reverse this grant of summary
judgment. A factfinder could reasonably conclude that Mr. Genberg had
engaged in protected activity by writing the email on March 2, and Mr.
Porter argues that the Board decided the next day to eventually fire Mr.
Genberg. With further protected activity on March 4, the Board decided to
investigate Mr. Genberg himself. This investigation ultimately led the
Board to fire Mr. Genberg. In these circumstances, a reasonable factfinder
could conclude that Mr. Genberg’s protected activities had contributed to
his firing.
21
IV. Defamation Claim
Mr. Genberg also sued Mr. Porter for defamation based on statements
to a Ceragenix consultant, Ceragenix lenders, and the SEC. This claim fails
as a matter of law.
The parties agree that Nevada law applies to the defamation claim,
and Nevada recognizes a common-interest privilege. Lubin v. Kunin, 17
P.3d 422, 428 (Nev. 2001). The privilege applies if
 the defamatory statement was made in good faith and
 the writer and the reader share a common interest in the content
of the statement.
Id. Mr. Genberg admits that the privilege applied to Mr. Porter’s
defamatory statements and argues only that Mr. Porter abused the
privilege. 6 In support, Mr. Genberg contends that a defendant can abuse the
common-interest privilege other than through malicious statements.
The privilege is abused when a defendant “publishe[s] with malice in
fact or otherwise abuse[s] the privilege.” Pierson v. Robert Griffin
Investigations, Inc., 555 P.2d 843, 843 (Nev. 1976). But the privilege is
abused only if the defendant acted “without belief in the statement’s
probable truth.” Circus Circus Hotels, Inc. v. Witherspoon, 657 P.2d 101,
105 n.2 (Nev. 1983).
6
Mr. Genberg also argued in his opening brief that the privilege did
not apply to Mr. Porter’s SEC filing. But Mr. Genberg admitted in his
reply brief that he had failed to preserve this issue in district court.
22
Mr. Genberg does not argue that Mr. Porter doubted the truth of what
he said. To show abuse of the privilege, Mr. Genberg needed evidence that
Mr. Porter
 had thought his statements were false or
 had disregarded their falsity.
See id. Because Mr. Genberg did not present such evidence, Mr. Porter was
entitled to summary judgment on the defamation claim.
V. Conclusion
A trier of fact could reasonably find satisfaction of the elements of a
Sarbanes-Oxley claim. Doing so, the trier of fact could reasonably view the
March 2 and March 4 emails as protected activities that had contributed to
Mr. Genberg’s termination.
Mr. Porter newly asserts the same-action defense, but a reasonable
factfinder could conclude that Mr. Genberg would not have been fired in
the absence of the March 2 and March 4 emails. As a result, Mr. Porter is
not entitled to summary judgment based on the same-action defense.
Because the district court found otherwise, we
 reverse the district court’s grant of summary judgment to Mr.
Porter on the Sarbanes-Oxley claim and
 remand for further consideration of this claim.
But on the defamation claim, we affirm the district court’s award of
summary judgment to Mr. Porter. His statements fell under the common-
23
interest privilege, and Mr. Genberg has not presented evidence of an abuse
of the privilege.
24
16-1368, Genberg v. Porter
HARTZ, Circuit Judge, concurring and dissenting:
I concur in the panel opinion’s affirmance of the summary judgment on the
defamation claim; but I respectfully dissent from the reversal of the summary judgment
on the claim of retaliation under the Sarbanes-Oxley Act. I would affirm the district
court on the ground that no reasonable juror could infer that Mr. Genberg subjectively
believed that the March 2, 2010 email to the board of directors of Ceragenix
Pharmaceuticals, Inc. (the Salamon email) was reporting a past, or even potential,
violation of federal securities law. Although Mr. Genberg, the author of the email, had
been a lawyer sophisticated in securities law, the email never states that any conduct by
anyone had violated or would violate federal securities law. And the email’s references
to the proxy, which the panel opinion suggests may have violated an SEC regulation,
complain about the proxy only in terms of bad policy or corporate management. Nor can
Mr. Genberg’s affidavit, submitted long into this litigation and almost six years after the
email, carry the day. Its convoluted language fails to allege any prior violation of
securities law and, more importantly, it suffers the fatal defect of other sham affidavits in
failing to explain why, if Mr. Genberg believed there was a violation of securities law, he
failed to say that in the email.
An important part of the context of the Salamon email is that Mr. Genberg had
been a lawyer specializing in securities and business litigation. In the 1990s he had been
the lead plaintiff’s attorney in a multidistrict securities-fraud action. Perhaps, though I
doubt it, a sheepish unsophisticated person who believed that Ceragenix had been
violating or was about to violate federal securities law could have authored the Salamon
email; but it beggars imagination to conceive that Mr. Genberg had that belief when he
sent the email.
The purpose of the Salamon email, as stated in its opening sentence, was “to
request the immediate transfer of voting rights in the proxy you hold over shares of
Ceragenix [Pharmaceuticals].” Aplt. App. Vol. 4 at 877. I can think of no better way to
encourage the directors to comply with a request than to say that what is being requested
is commanded by federal securities law. But the email never says that.
On the contrary, the email suggests that the request is not a demand to comply
with federal law. The reasoning behind the request is first presented in the second
paragraph of the email. The initial sentence of that paragraph begins: “This request is
based, in part, on recent SEC changes to proxy voting rules (affecting the ability of shares
held in ‘street name’ to be voted by brokers in uncontested elections for the Board of
Directors),” and then quotes the SEC’s stated rationale for the changes. Id. This may
look like an assertion that securities law is being violated, but the second sentence
explains: “While the new proxy rule is not directly applicable (as it applies to share[s]
held in street name voted by brokers) the policy rationale is clearly on point.” Id. Thus,
the email explicitly states that the recent change to proxy rules does not apply. And the
following sentence states: “We believe that [it] is neither fair, just or equitable that you
retain the voting power over the shares for 5 years and use such power to re-elect the
members of the Board of Directors without any consideration for the interests of
investors.” Id. Why would anyone, much less a lawyer, make a plea on the basis of
2
fairness and justice and equity if he thought that federal law required the requested
action? Why would a person believing that conduct he wishes to halt is in violation of
federal law, make no mention of that belief but commence his argument by stating that
another law does not apply and conclude by seeking justice and fairness? Such extreme
pussyfooting is not rational, and no reasonable person could believe that Mr. Genberg
was acting in that manner.
The next few paragraphs of the Salamon email (consisting largely of quotations
from the Ceragenix 2008 proxy statement) describe the history of the escrowed shares
and accompanying proxy and explain why the continuance of the proxies is unfair to
those sending the email. The eighth paragraph of the email ends by complaining that the
proxy has been kept “alive for a period [of] years longer than was ever contemplated and
has thus deprived us of any voice in the management of Ceragenix. Whose interest is the
Board accountable to when it votes the proxy over what constitutes nearly 66% of the
voting power in Ceragenix? This is the antithesis of sound corporate governance and
shareholder accountability.” Id. at 879. The panel opinion characterizes the last quoted
sentence as follows: “This retention of voting power, the email argued, clashed with SEC
policies of ‘sound corporate governance and shareholder accountability.’” Maj. Op. at 8.
But I cannot find in that paragraph (or anywhere in the email except the previously
quoted portion of the second paragraph referring to an admittedly inapplicable proxy
rule) any suggestion that the email was referring to SEC policies, much less federal
securities law, when it spoke of corporate governance and shareholder accountability.
There is a reference to “sound corporate governance” two paragraphs later, but there the
3
email invokes Delaware law, not federal law: “We believe that sound corporate
governance requires annual shareholder meetings as required by Title 8 Section 211 (C)
of the Delaware General Corporate Laws.” Aplt. App. Vol. 4 at 879. Mr. Genberg was
not shy about invoking applicable law in this email.
Then there is the final paragraph of the email. It is incomprehensible to me how
Mr. Genberg could have written the paragraph as he did if he believed there was a
violation of federal securities law. It reads:
We look forward to your prompt action in redressing this issue. We hope
that you share SEC Chairman Shapiro’s view that voting rights should be
exercised by those with an economic interest in the company. We ask that
you immediately transfer to us the proxy granted to you over the common
shares of Ceragenix so that we may exercise this voting power until such
time that Osmotics completes its long delayed plan of distribution for these
shares. We trust that it will not be necessary to bring this matter before the
Delaware Court of Chancery.
Id. Rather than referring to federal law, he refers to the “view” of the SEC chairman.
And rather than threatening action based on federal law, he threatens litigation in the
Delaware chancery court. Is it really reasonable to believe that Mr. Genberg wrote this
with the belief that the action he was demanding was required by federal securities law?
I am not saying that Mr. Genberg’s claim is deficient just because the email failed
to cite to a specific SEC rule that had been or might be violated. The problem is deeper
than that. Everything about the email conveys the author’s belief that the challenged
behavior was not governed by federal securities law.
What about Mr. Genberg’s affidavit, executed on February 6, 2016, just shy of six
years after the Salamon email, in response to Mr. Porter’s motion for summary
4
judgment? The panel opinion construes the affidavit as asserting that Mr. Genberg had
believed that Ceragenix was violating SEC Rule 14a-4(d)(2), which states that “[n]o
proxy shall confer authority . . . [t]o vote at any annual meeting other than the next annual
meeting . . . .” See Maj. Op. at 12. I will not challenge that construction, although I note
that the affidavit is not that specific (referring only to “Rule 14,” Aplt. App. Vol. 6 at
1110) and that the record indicates that there could not have been a prior violation of
Rule 14a-4(d)(2) because Ceragenix had held only one annual shareholder meeting after
execution of the proxy.
The fundamental flaw in the affidavit arises from a different omission. It utterly
fails to explain why, if Mr. Genberg believed at the time of the Salamon email that
Ceragenix had engaged or was going to engage in conduct contrary to federal securities
law, he omitted any mention of that belief in the email. This court has previously
recognized how the legal process can be gamed by last-minute affidavits submitted in
response to motions for summary judgment. Even a sincere litigant can convince himself
years (here six years) after the event, contrary to the previously developed record, of the
truth of a matter that now appears to be essential to survival of his claim. Although
“sham affidavit” opinions typically address conflicts between such an affidavit and prior
deposition testimony, the rationale is that the affiant had every reason to disclose the
information earlier, so the last-minute affidavit should at least explain the failure. To
prevent “sham” affidavits from improperly prolonging litigation, we require the affidavit
to explain why the affiant did not mention the matter at an earlier time when one would
fully expect it to have been mentioned. See, e.g., Kendrick v. Penske Tranps. Servs., Inc.,
5
220 F.3d 1220, 1223–24 n.2 (10th Cir. 2000) (noting no attempt to clarify prior
testimony); Franks v. Nimmo, 796 F.2d 1230, 1237 (10th Cir. 1986); cf. Hexcel Corp. v.
Ineos Polymers, Inc., 681 F.3d 1055, 1063–64 (9th Cir. 2012) (“narrow, conclusory
denials” of knowledge in affidavit could not defeat summary judgment). But Mr.
Genberg’s affidavit provides absolutely nothing in explanation of why he failed to
mention in the Salamon email the possibility of a violation of SEC proxy rules. His
conclusory assertion that he had a belief six years earlier does not create a genuine
dispute of material fact.
Perhaps in the long run it does not matter whether we determine that Mr. Genberg
was engaged in protected activity when he sent the Salamon email. The second element
of his retaliation claim under the Sarbanes-Oxley Act is that Mr. Porter knew that
Mr. Genberg was engaging in protected activity. See Lockheed Martin Corp. v. Admin.
Review Bd., U.S. Dep’t of Labor, 717 F.3d 1121, 1129 (10th Cir. 2013). As explained
above, no reasonable person would think that the Salamon email was alleging a violation
of federal securities law. Summary judgment appears inevitable on that ground. See
Petersen v. Utah Dep’t of Corrs., 301 F.3d 1182, 1188–89 (10th Cir. 2002).
Finally, although Mr. Porter concedes that Mr. Genberg’s March 4 email alleging
insider trading was protected activity, there is no genuine dispute that Mr. Genberg would
have been fired even had there been no March 4 email.
6