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Law and Public Policy Beat

July 20, 2017 | Mary Gallagher

Many New Jersey commuters are experiencing a “summer of hell” marked by cancelled and delayed train service due to the deteriorating rail link to New York City. They might want to know why the state has not been able to get its act together to build a badly needed new train tunnel, even while it has been pushing relentlessly to build a mall in the Meadowlands.

“The Must-Build Swamp Mall, the Canceled Tunnel and Christie’s Era of Misrule,” by Bob Hennelly, published July 8 on the Insider New Jersey political news site, sheds light on the back story of the American Dream Mall, once known as Xanadu, the ugly color block building rising in the Meadowlands alongside the Hackensack River, which now has a targeted opening of fall 2018 after its on-and-off again construction resumed earlier this year.

Hennelly describes the government’s long-running support for the mall–which he characterizes as “the swamp-mall ponzi-scheme,” through the bankruptcy of the original developer, a tab that has ballooned by the billions and a series of blown deadlines, among other setbacks. He recalls Christie’s promise in 2011, when he steered $200 million in state aid to the project, that it would be ready by the 2014 Super Bowl.

And he contrasts that unwavering support for the mall with the failure to construct new rail tunnels under the Hudson River to Manhattan even though it was long known that they were needed for capacity purposes alone.

Then Hurricane Sandy hit, and upped the ante. The storm surge flooded the two existing tunnels, leaving behind residues that continue to eat away at their structural integrity.

Hennelly writes that the tunnels are “actively deteriorating from the inside” and that “the part of the structure that was most seriously damaged was the part passengers and crew would most rely on to escape from the tunnel in the event of an emergency.”

The residues, which infiltrated cracks, duct work and porous concrete, cannot just be cleaned up or removed. They will continue to corrode, causing serious problems until one and then both of the tunnels are rendered unusable. And thus far, any hope of replacing them is almost ten years off.

It did not have to be this way. A project known as Access to the Region’s Core, or ARC, which would have built two new tunnels along with a new station in Manhattan and a rail yard in New Jersey, had been on the drawing board for twenty years when Governor Chris Christie pulled the plug on it in October 2010. The federal government was to pay a bit more than half the original projected $8.7 billion cost.

More than $600 million had already been spent at the time of the cancellation, mostly on studies and design and the purchase of land in Manhattan. Not only was the federal funding lost, but the state incurred over $800,000 in legal fees fighting U.S. efforts to recoup spent monies and wound up repaying $95 million after reaching a deal that waived $2.7 million in penalties and interest.

Christie cited ARC’s rising cost and concern that state taxpayers would have to foot the bill for the overruns as reasons for walking away from the project.

ARC has been replaced by the Gateway program, which would extend and renovate the North East Corridor rail line linking Newark Penn Station and New York Penn Station and has an estimated cost of $20 billion. It is slated for completion in 2026.

Meanwhile, the cost for the two-million-square foot American Dream mall continues to mount, with an expected final tab of $5 billion. That does not include the environmental cost of building on state owned wetlands, which had to be filled in. Nor does it factor in the $41 billion in losses to several state pension funds that invested in it, including. $121 million from a 2006 investment made by the New York State Common Retirement Fund

As Hennelly’s headline indicates, Christie deserves much of the blame for the situation. But there is plenty to go around, and not just for Republicans. Hennelly names plenty of Democrats who backed the mall project without a similar commitment to tunnels. They include Christie predecessors James McGreevey, Dick Codey and Jon Corzine, former President Bill Clinton, former Vice-President Al Gore and Bradley Campbell, who later led the state Department of Environmental Protection.

Read Hennelly’s fascinating saga here:

https://www.insidernj.com/must-build-swamp-mall-canceled-tunnel-christies-era-misrule/

June 27, 2017 | Mary Gallagher

A unanimous decision by the New Jersey Supreme Court has overturned a lower court holding that would have allowed the government to deny access to vast swathes of information kept on its computers. https://www.judiciary.state.nj.us/attorneys/assets/opinions/supreme/a_88_15.pdf

The lower court had interpreted the state Open Public Records Act, aka OPRA, as mandating public access only to discrete records and not to information per se.

On June 20, the Supreme Court in Paff v. Galloway, labeled that an “overly constrictive reading of OPRA cannot be squared with [its] objectives or statutory language.”

It held that information electronically stored in government computers constitutes a government record, and that public entities can be required to disclose such information and even to gather together scattered pieces of it, if the request is clearly stated and the process requires no analysis or research.

The case involved a request by John Paff, an open government advocate, for certain fields of information from emails exchanged between Galloway Township’s municipal clerk and its police chief during a two-week period in 2013. Paff sought only the “sender,” “recipient,” “date,” and “subject” for each email.

Galloway acknowledged that the emails in their entirety were public records and thus subject to disclosure under OPRA but refused to provide a list or log with the selected information Paff had requested on the ground that no such record existed and OPRA did not require it to create one.

Though Galloway, which is located in Atlantic County, had granted similar requests in the past, it had ceased to do so and cited, in support of its new policy, informal guidance obtained from the Government Records Council.

Paff challenged the denial and prevailed in the trial court, based in part on testimony from Galloway’s own IT Specialist that providing the fields of information requested was not a burden and would consume no more than two to three minutes of time.

The Appellate Division reversed, agreeing with Galloway that a list of the information from the various email fields would have been a new document and was therefore not a public record under OPRA.

The Supreme Court granted Paff’s request for review and amicus status for four groups backing his position: the American Civil Liberties Union of New Jersey, Electronic Frontier Foundation, New Jersey Press Association, and Reporters Committee for Freedom of the Press.

Amici siding with Galloway were the New Jersey League of Municipalities, State Association of the Chiefs of Police and the Institute of Local Government Attorneys.

The Court unequivocally rejected the contention by the Township of Galloway that culling information from its databases and providing it in the form of a log or list amounted to the creation of a new public record and thus went beyond what OPRA requires.

Justice Barry Albin’s opinion pointed out that OPRA defines government records as consisting of “not only hard-copy books and paper documents housed in file cabinets or on shelves, but also ‘information stored or maintained electronically’ in a database on a municipality’s server.”

Consequently, “electronically stored information extracted from an email is not the creation of a new record or new information; it is a government record.”

The Justices observed that OPRA requests must be well-defined so that the records custodian knows precisely what is sought without having to do any subjective analysis or research and that Paff’s request met that standard.

They also found that the GRC guidance was not entitled to any deference.

Further, although the concerns raised by the police chief that the email log could compromise investigations or investigatory techniques or result in an unwarranted invasion of privacy were legitimate, they did not go to the threshold question of whether the information was a government record subject to disclosure but to whether it fell within an exception or exemption to disclosure.

If Galloway wanted to deny the request on such grounds, it would have to present evidence and arguments to the trial court, and give Paff the opportunity to respond and it would bear the burden of proof to justify such denial, wrote Albin.

Representing Paff in the case was Walter Luers, a solo practitioner from Clinton who specializes in OPRA and OPMA (Open Public Meetings Act) cases and serves as Vice-President of the New Jersey Foundation for Open Government.

 

June 23, 2017 | Mary Gallagher

debt-shackle

Justice Neil Gorsuch, the newest addition to the U.S. Supreme Court, recently authored his first opinion for the Court and it is one likely to have negative repercussions for large numbers of people who find themselves unable to pay their bills.

Henson v. Santander Consumer USA, decided on June 12, concerns the Fair Debt Collection Practices Act or FDCPA, a federal law that is meant to protect against abusive, unfair, and deceptive practices in the collection of consumer debt– debt incurred primarily for personal, family, or household purposes.

Among other things, the FDCPA prohibits debt collectors from harassing you with repeated phone calls, contacting you at work if you’ve asked them not to or calling you too early (before 8 a.m.) or too late (after 9 p.m.) or at a time known to be inconvenient. They also cannot talk to people other than your spouse about the debt, demand payment of more than is owed, add on unlawful fees and expenses, use obscene or profane language, or threaten you with violence or some other action, such as a lawsuit or arrest, that is illegal or not actually contemplated.

They must identify themselves as debt collectors, provide the name and address of the original creditor, inform you of the right to dispute the debt and send written validation of the debt on request. .

Violators can be sued for actual damages, including the costs of physical and emotional stress, statutory damages of up to $1,000 and the legal fees and costs for the lawsuit.

The FDCPA contains two alternate definitions of “debt collector”: “any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another.”

The case involved auto loans made to Ricky Henson and several others by CitiFinancial Auto. After the loans went into default, Santander Consumer USA was hired to service the debts, which it subsequently purchased and attempted to collect.

Henson and the others claim that those collection efforts violated the FDCPA.

The U.S. District Court for the District of Maryland and the Fourth U.S. Circuit Court of Appeals  both agreed with Santander that it was not a “debt collector” for purposes of the FDCPA because, as the owner of the debt, it was not attempting to collect an obligation “owed or due or asserted to be owed or due another.”

Writing for the Supreme Court, Gorsuch said that both parties agreed that third-party debt collection agents fall under the law while original lenders do not and he framed the question before the Court as whether a debt buyer such as Santander is more like a repo man or a debt originator.

He acknowledged that Court was not deciding whether Santander qualified as a debt collector under the first part of the definition, or because it was generally in the business of collecting debts owed to others, even though it owned these particular ones. Those issues had not been litigated by the parties and the Court had not agreed to decide them when it took the case, observed Gorsuch.

In holding that the FDCPA did not apply because the debts at issue were not owed to another, Gorsuch said he was relying on the text and structure of the statute.

He and the rest of the Court rejected the petitioners’ policy argument: that Congress intended to get independent debt collectors to treat people better and excluded loan originators from the reach of the bill based on the view that they already had sufficient incentive to behave well in dealing with customers.

Henson and the others contended that Congress never had the chance to consider debt buyers because the market for defaulted debt only came into existence after the law was passed in 1977 but that it would have treated them like independent debt collectors,

Gorsuch termed that “speculation” and refused to presume that a result “consistent with their account of the statute’s overarching goal must be the law.”

Henson drew several amicus briefs on each side, including one on behalf of 27 states (including New York, Pennsylvania, California, Connecticut, Delaware, and Florida but not New Jersey) arguing that debt buyers should be deemed debt collectors under the FDCPA.  They cited their strong interest in protecting consumers from collection abuses and the harms to which they contribute, including personal bankruptcies, marital instability, loss of work and invasion of privacy.

Other briefs urging that the FDCPA should apply to debt buyers were submitted by Public Counsel, the National Consumer Law Center and legal aid groups from three law schools –Yale, Berkeley and Notre Dame.

Amici on the other side included the Association of Credit and Collection Professionals, the U.S. Chamber of Commerce, the American Financial Services Association, the American Bankers Association, Consumer Bankers Association and The Clearing House Association, k

Reactions to Henson

The headline of a June 14 article about the Henson ruling by David Dayen on The American Prospect website read “Gorsuch’s First Opinion: Let Debt Collectors Run Amok” and labeled the ruling “a huge win for financial predators.”

Dayen expressed concern that debt collectors will now be able to evade FDCPA restrictions by how they structure their operations. For instance, a debt collector could buy a community bank and assign it the task of debt collection

In his view, the Court could have clarified things by using the FDCPA’s entire definition, eschewing a narrow approach to review as it has done in some cases such as Citizens United, where it loosened limits on political contributions.  “Only when it comes to people hounded by debts do they adhere so narrowly to the question before them,” Dayen lamented.

Commenting from the other side of the aisle was Donald Maurice, of the Maurice Wutscher law firm in Flemington, who represents debt collectors and two days after the decision, took part in a webinar about it offered by the American Bar Association’s Consumer Financial Services Committee and the debt industry trade group RMA, for Receivables Management Association.

From Maurice’s perspective, the alternative definition that the court declined to address will likely be used in an attempt “to end-run the ruling.”

Because of that unresolved issue, RMA has urged the industry to proceed with caution in interpreting Henson. It “raises questions for debt buying companies who purchase and actively collect on their own debt” who while not collecting debt owed another, “are still engaged in collecting debt,” said RMA in a statement issued June 12.

RMA urged consulting with counsel before making operational changes based on the decision.

The Supreme Court took the Henson case to resolve a split in the circuits on whether companies that buy defaulted debts are subject to the FDCPA.

The Eleventh Circuit read the FDCPA the same way as the Fourth Circuit. On the other hand, four circuits–the Third, Fifth, Sixth and Seventh, reached a contrary result, concluding that a debt buyer is a debt collector when it purchases and then collects defaulted debt or, alternatively, that debt collector status depends on whether the default occurred before or after the debt was purchased, a view that would have led to a different result in Henson.

 

Third Circuit Precedent 

The Third Circuit case, which has been the governing law in New Jersey, is Federal Trade Commission v. Check Investors, Inc. (2007). There, a debt buying and collecting business which had been fined $10.2 million in fines and enjoined against FDCPA violations contended that the law did not apply because it had purchased the debt and was thus a creditor to whom a debt was owed rather than a debt collector pursuing debts owed to someone else.

For the Third Circuit, timing was the crucial factor: whether the debt was in default at the time it was acquired, or became so later. It held that because the debts at issue were bought after default, the Act applied. To hold otherwise, “would elevate form over substance and weave a technical loophole into the fabric of the FDCPA big enough to devour all of the protections Congress intended in enacting that legislation,” stated the court.

The decision in Henson leaves uncertainty about the standards of conduct that govern a sizeable portion of the multi-billion dollar debt collection industry, which affects millions of people.

In a March 2017 report, the Consumer Financial Protection Bureau  (CFPB) characterized it in as an $11.4 billion dollar industry in the U.S. last year, with debt buyers accounting for about $3.6 billion of that revenue, nearly one-third.

The vast majority of the debt collected, about 70%, is credit card debt, followed by automobile loans, telecommunications debt (phones and cable bills) and retail accounts. It can also include personal loans, utility bills, medical bills and mortgages.

Debt buyers buy defaulted debt for pennies on the dollar and try to collect in full.

According to the CFPB, debt collection is the most complained about consumer financial product or service in its system, with the most common issue raised being attempts to collect debts that are allegedly not owed because the they have already been paid or the balance is incorrect. Consumers can have a hard time confirming the validity of medical debt because they are being dunned for services they thought were covered by their health insurance.

The CPFB found that about 70 million Americans, roughly one third of consumers with credit files, were contacted by a creditor or third-party debt collector attempting to collect a debt within the past year.

Henson was the second Supreme Court ruling benefiting debt buyers handed down in the last month or so.

The other, Midland v. Johnson, decided May 15, allows debt buyers to file proofs of claim in a bankruptcy case beyond the statute of limitations without violating the FDCPA. This creates an incentive for debt buyers to pursue expired claims.

Gorsuch did not participate in that 5-3 decision. Justice Breyer wrote the majority opinion, with a dissent by Justice Sonia Sotomayor, who was joined by Justices Ruth Bader Ginsburg and Elena Kagan.

May 12, 2017 | Mary Gallagher

A two-year-old rule that makes it harder to collect unemployment benefits in New Jersey has been struck down in court.

On May 1, a three-judge Appellate Division panel invalidated N.J.A.C. 12:17-2.1 as arbitrary and capricious, finding it illogical and confusing and calling it a “linguistic morass, one that cannot be readily or sensibly understood and applied.”

The court gave the Department of Labor and Workforce Development (DOL), 180 days to adopt an acceptable substitute.

In the meantime, however, the rule will continue in effect because the court stayed its decision, saying it wanted to avoid disruption to the program.

The provision at issue in the case, captioned In re N.J.A.C. 12:17-2.1, defines “simple misconduct,” a term for conduct that can limit the eligibility of terminated workers to receive unemployment compensation.

The law recognizes three levels of such misconduct—simple, severe and gross, each with its own set of consequences.

Simple misconduct delays the start of benefits by eight weeks, versus one week when there is no misconduct.

Severe misconduct results in complete disqualification from benefits until the employee finds and works in a new job for at least four weeks and makes six times the weekly benefit rate.

For gross misconduct, you must work in the new job a bit longer, eight weeks, and make 10 times the weekly benefit amount.

The statute defines gross misconduct as an act that constitutes a crime of the first, second, third or fourth degree under New Jersey law.

It is far less clear what actions meet the simple or severe misconduct standard.

Initially, the law referred only to misconduct and gross misconduct but was amended in 2010, adding an intermediate category of severe misconduct, while “misconduct” became “simple misconduct.

The amendment did not define simple misconduct or severe misconduct but gave some examples of the latter: repeated violations of an employer’s rule or policy, repeated lateness or absence after a written warning; falsification of records; theft of company property; misuse of sick time; abuse of leave; excessive use of intoxicants or drugs at work; and physical assault or threats or malicious and deliberate conduct that does not rise to the level of gross misconduct.

A prior 2013 appeals court decision, Silver v. Board of Review, took a look at the 2010 amendments in overturning a decision to deny benefits based on severe misconduct.

The plaintiff, Joan Silver, was a teacher at the Middlesex County Youth Facility who was fired for repeatedly failing to collect all the pens from her students at the end of class, which was required for security purposes.

During her nine years on the job, she had come up short six times and after the sixth, she was warned she would be fired if it happened again. Six months later, she was fired over another missing pen, then denied unemployment for supposed severe misconduct, based on the repeated violation of employer policy rationale.

The Silver court reversed on the ground that the lapse did not even qualify as simple misconduct, never mind severe misconduct.

It made no sense to require intentional and malicious acts for simple misconduct while allowing mere inadvertence or negligence to suffice for severe misconduct, the judges reasoned,

They mentioned that the DOL had not yet adopted a rule to distinguish simple from severe misconduct but that there was one in the works, the one eventually adopted in 2015 and the subject of the May 1 court decision.

The rule states that “simple misconduct” “means an act which is neither ‘severe misconduct’ nor ‘gross misconduct’ and which is an act of wanton or willful disregard of the employer’s interest, a deliberate violation of the employer’s rules, a disregard of standards of behavior that the employer has the right to expect of his or her employee, or negligence in such degree or recurrence as to manifest culpability, wrongful intent, or evil design, or show an intentional and substantial disregard of the employer’s interest or of the employee’s duties and obligations to the employer.”

During the 2014 rulemaking process, the National Employment Lawyers Association (NELA-NJ).and attorney Alan Schorr submitted written objections to the proposed rule, as did Legal Services of New Jersey, and Schorr, who also represented Silver, spoke against it at a public hearing.

He pointed out that the rule’s definition of “simple misconduct” would “remove the requirement of maliciousness, and replace it with negligence. There was no indication that the Legislature, when it added severe misconduct in 2010, meant to lower the standard to deprive employees of benefits for making a mistake, even repeatedly, without intent to harm anyone, said Schorr.

Legal Services similarly urged that maliciousness should remain a requirement for simple misconduct and also that certain examples of severe misconduct, such as falsification of records, which could be due to carelessness, should have be more than isolated incidents to be deemed severe and disqualify from benefits, which would be “disproportionately punitive.”

Following the rule’s adoption in 2015, Schorr challenged it in court on behalf of his firm and NELA-NJ. He accused the DOL of trying to expand the definition of misconduct to disqualify as many people as possible, contrary to the legislative purpose of the law to provide a safety net to those left involuntarily jobless.

He characterized the DOL’s revised definition of misconduct to include negligence as an “end run around decades of judicial interpretation and enforcement,” including Silver.

The May 1 appeals court opinion relied heavily on and reaffirmed Silver, citing its recognition of the “critical distinction between intentional and deliberate conduct on the one hand and negligent or inadvertent conduct on the other.”

The regulations the DOL adopted in 2015 “fail to make this critical distinction between simple negligence, on the one hand, and intentional, deliberate, or malicious conduct, on the other hand, at least not consistently,” held the court. The literal wording of the rule “confusingly blends concepts of negligence with intentional wrongdoing that cannot be sensibly understood or harmonized,” wrote Judge Jack Sabatino, joined by William Nugent and Michael Haas.

The court also saw a problem in that the rule’s definition of “simple misconduct” encompassed employee actions as serious as those falling under “severe misconduct,” perhaps even more so. For example, the court termed it “difficult to comprehend how an employee who has acted with ‘evil design’ or with ‘wrongful intent’ is only guilty of simple misconduct and not severe misconduct.”

Sabatino added that the panel did not “ascribe any improper policy motives” to the DOL.

The DOL has informed him that it intends to appeal, said Schorr.

He said in an interview that his firm handles more unemployment cases than any other firm in the state and that, since the 2010 revision, the number has risen, as has the reversals.

Schorr provided as examples of negligent acts for which benefits are being denied, leaving open a jewelry case in a retail store, even though nothing was stolen, and incorrectly mixing the paint in a hardware store more than once.

The May 1 ruling marks the second time in less than two months that the Appellate Division has sided with employees on unemployment benefits in a precedential opinion.

On March 6, a different three-judge panel–Susan Reisner, Ellen Koblitz and Thomas Sumners Jr.–ruled that employees who suffered workplace discrimination need not deduct their unemployment benefits from the back pay that they recover in court as damages under the New Jersey Law Against Discrimination (LAD).

The trial court in that case, Acevedo v. Flightsafety International, had reduced the back pay damages awarded to the plaintiff by one half of the unemployment compensation he received.

The Appellate Division held that the collateral source statute does not apply to LAD claims.

April 8, 2017 | Mary Gallagher

The New Jersey Assembly has overwhelmingly passed a bill that would protect people who speak out on public issues from baseless lawsuits meant to intimidate them into silence.

The legislation, A-603, targets SLAPP suits, the shorthand for what are known as Strategic Lawsuits Against Public Participation.

SLAPP suits, which often occur in the context of opposition to real estate development projects, pitting people from the community against a wealthy corporation, are meant to deter opposition because of the high cost of defending them, even if they are eventually thrown out for lack merit or withdrawn once the developer or other SLAPP plaintiff has succeeded in quelling critics.

In a leading New Jersey case on SLAPP suits, LoBiondo v. Schwartz, decided in 2009, the Court referred to scholarly articles that defined the problem as “a nationwide trend in which large commercial interests utilized litigation to intimidate citizens who otherwise would exercise their constitutionally protected right to speak in protest against those interests.” The “goal of such litigation was not to prevail, but to silence or intimidate the target, or to cause the target sufficient expense so that he or she would cease speaking out.”

A-603 would provide a quicker and clearer path to early dismissal of SLAPP suits, before the legal fees and costs had a chance to mount.

It defines a “SLAPP lawsuit” as “intended to deter or suppress the desire of any citizen to act in furtherance of the right of public advocacy on issues of public interest.” Such issues are those “related to: health or safety; environmental, economic, or community well-being; the government; a public figure; or a good, product or service in the marketplace” and exclude statements directed to the speaker’s commercial interest and other private interests.

SLAPP suits are often framed as claims for defamation, tortious interference with business or contract, civil conspiracy or abuse of process, nuisance or constitutional or civil rights violations, according to the A-603.

Under the bill, SLAPP suit defendants would file papers asking that the case be dismissed and those requests would be expedited to “the extent possible “in order to dispose of the case quickly in order “to prevent the unnecessary expense of protracted litigation.”

They would bear the initial burden of presenting prima facie evidence that the case is a SLAPP suit.

Once they make that showing, the burden would shift to the purported SLAPP plaintiff to show that they have evidence to support their claims, are likely to prevail, and that the SLAPP defendant caused them “actual compensable harm” and has no legal or factual basis to have the case thrown out.

The filing of a motion to dismiss a case on the basis that it is a SLAPP suit stays all discovery and proceedings in the case until the motion is decided but the judge, for “good cause,” can allow limited discovery that will assist in deciding the motion.

A defendant who succeeds in getting a case thrown out as a SLAPP suit would be entitled to the costs incurred in the litigation, including legal fees. To deter a repetition, an additional sum could be awarded as sanctions against the plaintiff. An earlier version of the bill prescribed a $10,000 sanction but the current version does not set a specific amount and leaves it up to the judge.

On the other hand, those who try and fail to get a case thrown out as a SLAPP suit would have to pay the other side’s costs and legal fees if the court finds that the request was frivolous or solely intended to cause unnecessary delay. But they do not risk sanctions and the fact that they failed could not be used against them later in the litigation or otherwise affect the standard of proof.

The bill also blocks those SLAPP suit filers from evading costs by pulling the suits after a request to dismiss has been submitted but before it has been decided. Judges must still award the fees and costs of filing the application to dismiss, “as appropriate.”

A-603 also specifically authorizes use of the common law tort for malicious abuse of process as the basis for “SLAPP-back” actions or claims against those who bring SLAPP suits and lays out the elements of such a claim: malice, absence of probable cause and a “special grievance” suffered by the claimant, such as interference with liberty or property or “severe and permanent economic damages.”

Not every non-meritorious suit aimed at public expression is covered by the bill. Civil actions by government entities to enforce laws protecting public, safety health and welfare would be exempted, as would SLAPP-back suits and claims against those engaged in selling or leasing of goods or services based on statements of fact made for marketing purposes or directed to potential buyers.

Though A-603 had strong support, with 69 of the Assembly’s 80 members voting in favor and only three “no” votes (there was one abstention and seven not voting), its prospects remain uncertain.

Twice before, the Assembly has approved similar legislation, which then died because no Senate bill passed.

The first time was in June 2005, when 79 Assembly members supported A-1077, and no one voted against it. A Senate counterpart was filed in December of that year but did not get a committee hearing.

The issue lay dormant in the legislature until July 2014, when Joseph Lagana, a Democratic Assemblyman from Bergen County, sponsored A-3505. It passed the Assembly 68-4 in February 2015.

But it had no Senate counterpart and died when the session ended.

Lagana reintroduced the identical measure as A-603 in January 2016, the start of the current session and it quickly cleared the Assembly Judiciary Committee in a March 2016 vote.

By the time it reached the Assembly floor a year later, however, it had been extensively reworked.

Many of the changes were prompted by objections from the Administrative Office of the Courts, or AOC, whose opposition reportedly helped block prior bills.

Daniel Phillips, the AOC’s Legislative Liaison, articulated its concerns at the October 2014 hearing before the Assembly Judiciary Committee on last session’s A-3505.

Phillips agreed that the use of lawsuits to censor, silence and intimidate people who want to speak out on public issues is not an appropriate use of the justice system and supported “some measure to try to curtail that.”

He pointed out that it is not clear to the courts on filing which cases are SLAPP suits, though they are generally defamation matters.

He blamed the demise of the 2005 bill on the inability to compromise on staying discovery on the filing of a motion to dismiss a SLAPP suit. Because discovery is needed to determine the validity of the claim, the AOC favored a different approach, comparable to what was done with medical malpractice cases, where certificates of merit must be filed early on to avoid dismissal. He thought that model could also work for SLAPP suits, in conjunction with the statute and court rule regarding frivolous litigation.

He also raised concerns about a possible explosion of litigation, as occurred in California after it enacted an anti-SLAPP law and said the shifting of the burden of proof on filing a motion for a SLAPP dismissal was a policy measure rather than a procedural one that should be dealt with in the statute.

The current bill addresses the AOC concerns with its provisions for limited discovery, burden of proof and exemptions.

As of now, no companion bill to A-603 has been introduced in the Senate but a knowledgeable source says that is expected to happen soon.

New Jersey Appleseed, which supports A-603, has successfully defended people hit with SLAPP suits and has helped mold the law in New Jersey to afford greater protection against SLAPP litigation.

For example, it won sanctions against a lawyer and a developer who brought frivolous lawsuit against a citizen who spoke out against a development project at a local municipal board hearing and won a favorable settlement for community activists from the Fund for a Better Waterfront, who were sued in retaliation for speaking out about the environmental impact of blasting practices by Stevens Institute of Technology at a construction site in Hoboken.

The Hoboken case established that statements of public concern are constitutionally protected and not considered defamatory when they rely on information debated within the scientific community and confirmed that corporations cannot make claims based on the assertion that they are victims of “invasion of privacy,” or are being portrayed in a “false light.” Further, NJ Appleseed defeated “prima facie tort” as a catch-all cause of action that could be used against SLAPP activists and community groups trying to exercise their legitimate rights of expression.

NJ Appleseed has just agreed to take on the defense of a SLAPP suit brought by Jane Jannarone, a member of the state Pinelands Commission who voted on Feb. 24 to approve a highly controversial pipeline through the New Jersey Pinelands. Jannarone sued 14 individuals who allegedly defamed her by posting negative comments about her and her support for the pipeline on the Facebook page for her real estate business, based in Vineland.

She asserts that they damaged her reputation as a realtor which will lead to loss of income and have caused her “extreme mental anguish and distress.” There is also a count for tortious interference with prospective economic advantage.

Among the alleged comments cited in the complaint were that Jannarone was on her cell phone during the public hearing on the pipeline and thus, “I would not trust her to listen to your concerns,” and accusations that she is “rude and unprofessional, a “terrible person” running a “horrible company,” a “piece of ?!!!!!,” a “sellout” a “greedy cunt,” a “disgrace” who cares “about nothing more than the mighty dollar” and a “shill for the gas company and Chris Christie.” One defendant allegedly paraphrased The Rolling Stones song, “Sympathy for the Devil,” substituting the lyric about a man with “wealth and taste” with a reference to Jannarone as someone who “stole the pinelands soul and faith.”

Appleseed will be representing 12 of the defendants in the case, Jannarone v. Mendel, CUM-L-206-17, which was filed on March 20 in Cumberland County Superior Court.

 

April 4, 2017 | Mary Gallagher

A battle over whether a developer will be allowed to renege on a promise to provide open space on the Hoboken waterfront was argued before the Appellate Division on Feb. 28.

New Jersey Appleseed’s Renee Steinhagen represents Fund for a Better Waterfront in several related appeals involving the Monarch Towers development.

The dispute concerns whether two 11 -story condominium towers can be built on a nearly two-acre waterfront parcel where the developer promised in 1997 to provide open space, including tennis courts and the final segment of the developer’s Hudson River Waterfront Walkway.

The construction faces fierce public opposition and would violate Hoboken ordinances that prohibit residential development on piers and platforms over the Hudson River. Those ordinances were adopted in December of 2013 in response to Superstorm Sandy, and in conformance with newly adopted federal and state standards to protect communities from flood hazards.

Read more about the case at http://bit.ly/2o6eMZA

 

 

 

 

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