A U.S. District Judge in Philadelphia has closed another chapter in the bitter ongoing dispute between David Danon and Vanguard, by dismissing the whistleblower’s wrongful termination suit, writes Jeff Blumenthal for Philadelphia Business Journal.

The former tax lawyer for the Malvern based investment management giant claimed in his lawsuit that Vanguard had fired him as a direct result of concerns he had raised about some of its tax practices. Danon came out as a whistleblower against the company after his dismissal, claiming that due to its specialized structure, Vanguard had broken several IRS laws and could owe tens of billions in unpaid taxes.

The Securities and Exchange Commission intervened on Danon’s behalf in late March with an amicus brief saying he deserved whistleblower status under the 2010 Dodd-Frank financial reform law. That case was dismissed as Danon did not go straight to federal officials when he was fired. The SEC later admitted that this significantly weakened the ability of the commission to use the evidence he provided against corporate wrongdoing.

Vanguard then fired back against Danon’s wrongful firing suit by filing a motion to dismiss the case, which was accepted by the court under New York’s False Claims Act ruling.

U.S. District Judge C. Darnell Jones II of the Eastern District of Pennsylvania cited the New York state court’s finding on a separate lawsuit which ruled that Danon did not prove Vanguard was aware that he was engaging in any protected activity, which made his subsequent federal suit unviable.

“Neither the complaint, nor the additional submissions, contain any allegations that Vanguard knew in January 2013, that Danon was involved in protected conduct” wrote Judge Darnell Jones II. “Notably, Danon does not indicate the dates when he expressed his concerns to Vanguard’s employees and, in particular, whether he did so before he was informed of his termination in January 2013.”

The judege commented that Vanguard let Danon keep his job until June of that year and Danon used that time to collect Vanguard documents and information to strengthen his whistleblower case. He also noted that he thought it unlikely that Vanguard would have let Danon stay on long enough to do that if it had realized he was organizing a whistleblower complaint.

“We are pleased that a second court dismissed the plaintiff’s attempt to pursue similar claims in another court, as we have stated repeatedly that this case was without merit,” stated Vanguard spokeswoman Emily M. Farrell.

Read more about the decision at Philadelphia Business Journal here, and check out previous VISTA Today coverage of Vanguard here.