People for Open Government

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Appeal

 

 

PRELIMINARY STATEMENT

     Taking advantage of the trial courts overly broad summary judgment Order that was drafted by their counsel (Pa127-128), Defendants ask this court to affirm that Order on a host of reasons none of which were determined by the court below, let alone adequately considered. Although Plaintiffs/Appellants agree with the general principles that appeals are taken from judgments and not from the opinions supporting those judgments, Belfer v. Merling, 322 N.J. Super. 124, 142 n.2 (App. Div. 1999), and appellate courts have the authority to affirm or reverse on grounds not determined by the trial court, Liebeskind v. Mayor & Municipal Council, 265 N.J. 389, 400 (App. Div. 1993), Plaintiffs have failed to locate one case in which the trial court dismissed a complaint on the basis of standing, and the appellate court then reached out to affirm that dismissal on the merits of the complaint. 

     Plaintiffs urge this Court to be cautious so as not to supplant the role of the trial judge which, in this case, is to interpret the "Pay to Play" ordinance herein at issue (the "POG Ordinance"), and apply it to a complicated set of facts, see Curtiss v. Finneran, 83 N.J. 563 (1980)(R. 1:7-4(a) requires trial court to clearly state factual findings and correlate them with relevant legal conclusions); a set of facts that can only be developed and made certain after Plaintiffs have had an opportunity to pursue discovery and prove their allegations. Because summary judgment cannot be affirmed on alternative grounds that are solely legal in nature, this Court should reverse the trial courts Order based on standing, and remand this matter to the trial court to reinstate the complaint and permit Plaintiffs to join all necessary parties and proceed with discovery. Nothing in Defendants response warrants otherwise (including Defendants gratuitous attacks on the form of Plaintiffs papers that are simply inaccurate; for example, Plaintiffs did not present a 7-page preliminary statement nor include footnotes therein). See e.g., Order denying without prejudice Defendants Motion to Strike (Pra14).

LEGAL ARGUMENT

I.  PEOPLE FOR OPEN GOVERNMENT AND THE INDIVIDUAL

PLAINTIFFS HAVE A SUFFICIENT INTEREST TO SATISFY

NEW JERSEY STANDING REQUIREMENTS.

 

 In his decision, Judge Gallipoli found that in cases that do not involve a "constitutional challenge to legislation" taxpayers do not have standing unless they allege "special damages." (Pa139) Defendants do not defend this holding, but now seek to justify the trial courts decision on the broader proposition that as a matter of common law "a plaintiff must be more then [sic] a mere tax payer or resident" to have standing to enforce all local ordinances. (Db21).  This proposition is simply not true.  The numerous taxpayer lawsuits cited by Plaintiffs in their initial brief, especially in the area of public contracting, simply belie such claim. (Pb14-17)

There is little doubt that in this case Plaintiffs are trying to enforce a public contracting reform ordinance (that they initiated) by compelling Defendants to take actions that are required under the ordinance, including finding certain contributors/contractors in material breach.  Thus, it is each of the taxpayer lawsuits challenging the validity of a public contract, the bidding process or the award of a particular contract that applies herein, (Pa15) and is conspicuously missing from Defendants response papers. (Dbiii-iv). Defendants simply do not and cannot refute the established principle that municipal taxpayers, when seeking review of local official action relating to the fiscal purse or integrity of government processes, such as the public contracting process, do not have to prove, contrary to the holding below, "unique financial detriment to them" or special damages that are different than the public injury incurred by all taxpayers.  CamdenCounty v. Bd. Of Trustees of Public Employees Retirement System, 170 N.J. 439, 447 (2002).    

Instead, Defendants berate Plaintiffs for failing to discuss Wildlife Preserves, Inc. v. Poole, 84 N.J. Super. 159 (App. Div. 1964), Colon v. Tedesco, 125 N.J. Super. 446 (Law Div. 1973), and United Stations of N.J. v. Kingsley, 99 N.J. Super. 574 (Ch. Div. 1968), affd Del Spina v. Getty Oil Co. 54 N.J. 150 (1969) as if they were determinative herein. Like the holding in Garrou v. Teaneck Tyron Co., 11 N.J. 294 (1953), these cases are clearly not relevant; not one involves taxpayers and certainly not one "draw[s] a distinction between taxpayer attempts to compel a governing body to enforce the law and taxpayer challenges to the validity of a specific law or a specific governmental action" as asserted by Defendants. (Db26)  

The respective courts in Wildlife Preserves, Inc. and Garrou set forth the general rule that a property owner, may obtain equitable restraint against a violation of a zoning ordinance (not a public contracting ordinance), only if he can assert special damages above the public injury -- a holding that may no longer apply to citizen attempts to enforce a municipal zoning scheme, given the broad definition of "interested party" under the Municipal Land Use Law, N.J.S.A. 40:55D-4 (Pb16n3).  The court in Colon held that a migrant worker had standing to compel the state to bring a nuisance action (not to enforce a statutory scheme) against owners and operators of the camp in which he resided; and, the court in United Stations of N.J. found that a gas station operator had a private right of action directly against violators of a statue that otherwise authorized the state tax commissioner to enforce.

Further, Defendants attempt to distinguish many of the cases cited by Plaintiffs without reference to how or for what purpose Plaintiffs cited them does not support the trial courts holding that Plaintiffs do not have standing. All of the precedents presented in Plaintiffs Appeal Brief were used to establish the framework that New Jersey courts use to determine whether a party has standing, and several of them specifically involve compelling a municipality to enforce a statute by either refraining or taking action.  E.g., Yacenda Food Management Corp. v. New Jersey Highway Auth., 203 N.J. Super. 264 (App. Div. 1985) (action to declare a certain contract void and to compel Authority to publicly advertise for competitive bids); Hoboken Environment Comm. v. German Seamans Mission of New York, 161 N.J. Super. 256 (Ch.Div. 1978)(prerogative writ action initially broughty against municipality to prevent issuance of a building permit).

Pursuant to this framework - personal interest, sufficient stake in the outcome, and real adverseness, -- it is clear that Plaintiffs, as taxpayers, voters or petitioners of the POG Ordinance, have standing to compel its enforcement.(Pb14-18). Defendants argument that only a losing candidate, in contrast to a voter, would have standing does not make sense. (Db26)  Enforcement of the POG Ordinance after an election would not bring such candidate relief in her status as "candidate"; only a challenge contesting the election (under Title 19) as fundamentally unfair or unlawful would provide such redress.

On the other hand, resident voters, such as Plaintiffs, have a sufficient stake in the outcome of an enforcement action even after an election (that was allegedly corrupted by unlawful contributions) is finalized.  Their interest in seeking the imposition of penalties on no-bid contractors who make contributions in violation of the POG Ordinance is directed at influencing future contribution practices and ensuring the integrity of municipal elections (by decreasing the flow of money into such elections) over time. Cf. Komuves v. Members of Taxpayers Against Change in Govt Comm., 261 N.J. Super. 393 (Law. Div. 1992)(registered voter had a sufficient interest to challenge actions by taxpayer committee that were allegedly deceptive).

Remedies in the POG Ordinance penalize no-bid contractors who violate the terms of the Ordinance, not candidates. See 20A-10A,B (Pa82) That is, a professional business entity that violates the contribution limits in the Ordinance and does not cure such violation "within thirty (30) days after the general election," (20A-9)(Pa82), stands to lose its business profits, and thus has an incentive to change its campaign contribution practices in the future.  Accordingly, it is taxpayers and voters as well as People for Open Government ("POG")(who Defendants acknowledge is a group of taxpayers whose mission includes "restricting pay-to-play", (Db29)) have a sufficient individualized interest to seek enforcement of the very ordinance they initiated.[1]

  Indeed, Defendants concession that Plaintiffs "might have standing to challenge a specific action of the municipality which violates the Ordinance," (Db27) undermines the trial courts decision that rests on Plaintiffs alleged need to establish unique financial damages. This enforcement action, similar to each of the opinions cited in Plaintiffs initial brief in which taxpayers were held to have standing to challenge the unlawful award of a public contract, is in fact an action to declare certain contributions unlawful and compel the Municipality to enforce the penalties set forth in the Ordinance: declare certain professional business entities in material breach of their service agreements, and/or disqualify them from eligibility for future City contracts for a period of four (4) years from the date of the violation. (Pa82).  Which sub-group of taxpayers or voters is better suited to bring this action other than the Plaintiffs, who include the petitioners and organization that were involved in the drafting of the POG Ordinance and its initiation onto the ballot?

II.         PLAINTIFFS SEEK TO ENFORCE A CONSTITUTIONAL SCHEME THAT IS CLEAR AND PROVIDES ADEQUATE REDRESS.

 

     During oral argument, Judge Gallipoli expressed his desire not to invalidate the ordinance for "vagueness or any other reason" such as lack of "proper procedure within in" or lack of "the right kinds of remedy," since he boldly declared,

But we all know what the intent of the ordinance was,

What it was intended to accomplish.

 

T19-15 through T19-25. (Pra11). Nonetheless, Defendants now justify summary judgment on several legal grounds that the trial court explicitly declined to do.  Even if this Court determines that such challenges to the validity of the ordinance are ripe,[2] they all lack merit and do not justify dismissal of this action.

A. Presumption of Validity Applies

     As a preliminary matter, Defendants make the facially

implausible argument that because the POG Ordinance (which includes factual findings and recitals in its "whereas" clauses) was adopted by the people, the usual presumptions of validity do not apply.  Defendants are wrong.  This Ordinance was the product of a reasoned decision of the citizens of Hoboken who overwhelmingly passed the Ordinance at the polls.  Just because it was not "a reasoned decision by the municipalitys legislative body" (Db59), does not make it any less valid, reasonable or enforceable.[3] Indeed, in Defalco Instant Towing, Inc. v. Borough of New Providence, 2005 WL 2155220 (App. Div. 2005) and HuttonParkGardens v. West Orange Town Council, 68 N.J. 543 (1975), both relied upon by Defendants, our courts have applied the general rule that all ordinances are entitled to a presumption of validity.

  These cases do not distinguish between ordinances passed by a legislative body of elected representatives and a legislative body comprised of the citizenry itself; and in fact, there is no case known to Plaintiffs that does so.  Not even the Legislature has distinguished between the binding nature of both citizen-initiated and council-initiated ordinances,[4] and neither shall the judiciary.

B. The POG Ordinance is Clear

  Defendants assert that there are differing, but reasonable interpretations of the phrase "the completion of the contract or agreement," 20A-6B, and therefore, the ordinance is constitutionally vague. (Db61). Established principles of statutory construction undercut this claim.  The terms of the phrase are precise, and Plaintiffs intent, as co-drafters of the POG Ordinance, to prohibit all contributions during the negotiations for or performance of a no-bid contract is clearly indicated. The vagueness doctrine is thus not implicated.

  The constitutional ban on vagueness is "intended to invalidate regulatory enactments that fail to provide adequate notice of their scope," State v. Cameron, 100 N.J. 586, 591 (1985), through the use of language that is ambiguous and uncertain.  The level of judicial scrutiny and the degree of clarity required depends, inter alia, on the purpose of the statute, the context of the law challenged, the conduct that is impacted, and the nature of the penalty. Id. at 594. Economic regulations, such as the public contracting ordinance herein, are subject to less scrutiny because "the subject matter is often more narrow and businesses can consult relevant legislation in advance of action," and "greater imprecision can be tolerated" when the penalties are civil rather than criminal, as is also the case herein.  Id. at 592.  Most importantly, "absent any explicit indications of special meanings, the words used in a statute carry their ordinary and well-understood meanings." State v. Mortimer, 135 N.J. 517, 532 (1994), cert. denied, 513 U.S. 970 (1994). Under this principle of statutory construction, there is only one reasonable interpretation of the prohibition set forth in 20A-6B of the POG Ordinance.

   Section 26A-6B prohibits a professional business entity from making any contributions "between the time of first communications between that business entity and the City of Hoboken regarding a specific professional services agreement and the later of the termination of negotiations or the completion of the contract or agreement."[5]  According to Blacks Law Dictionary (6th ed.) at 285, "completion" means "the finishing or accomplishing in full of something theretofore begun" and is synonymous with "substantial performance," which in turn is defined as the "faithful[] performance [of a contract] in its material and substantial particulars." Id. at 1429. Therefore, drawing on the ordinary and well-understood meaning of the word "completion", the phrase "completion of the contract" must mean substantial performance, consummation or conclusion of the tasks assigned in the contract.[6]

   This interpretation is consistent with, rather than contradictory to (as Defendants assert, Db35-6), the continuing reporting requirement imposed on professional business entities that have not terminated their negotiations with the City or completed their contracts.  Section 20A-8B requires the professional business entity to report any violations that "may occur during the negotiations or duration of a contract." That is, only during negotiations and prior to termination of such negotiations or during performance of a contract and prior to completion thereof are professional business entities prohibited from making any contributions and are thus subject to a continuing duty to report such contributions at the time made.[7]

   On the other hand, Defendants assertion that "completion of the contract" (Db38) means "when the contract or agreement is executed" or "when the contract or agreement has been signed by all parties"(Db35) is nonsensical. This interpretation plays havoc with the ordinary meaning of the phrase "completion of the contract," and in effect replaces it with the phrase "enters into the contract" or "signs the contract" neither of which the drafters used. Furthermore, it renders 20A-6Bs prohibition on contributions until "the later of the termination of negotiations or the completion of the contract" meaningless.

     That is, negotiations can end in only two ways: there is no deal and the parties walk away, or there is a deal and the parties enter into an agreement.  In the former circumstance where negotiations have failed there will be no contract to sign or perform so the phrase "completion of the contract" is not operative.  However, in the latter circumstance, where the negotiations terminate because they are successful, Defendants would interpret "the later of the termination of negotiations or the completion of the contract" to mean ""the later of the signing of the contract or the signing of the contract."  Of course, such an interpretation gives the Ordinance an Alice-in-Wonderland quality that no reader of ordinary intelligenceexcept one desperate to avoid the penalties imposed for violating the ordinancecould devise. See Reinauer Realty Corp. v. Nucera, 59 N.J. Super. 189 (App. Div. 1960)("[A] construction which will render any part of a statute or ordinance inoperative, superfluous or meaningless is to be avoided."

  Plaintiffs understanding of the clear language of the statute also accords with the purpose of the POG Ordinance and is tailored to meet specific problems perceived by the Plaintiffs, as drafters, and the electorate. The preamble to Article II, approved by referendum, specifically states that

... political contributions from professional business entities receiving discretionary contracts from the elected officials who receive such contributions raise reasonable concerns on the part of taxpayers as to their trust in the

process of local government, if not the quality or cost of services received.

 

20A-5. (emphasis added).  The electorates interest in "preventing actual or apparent corruption" as a means to increase trust in the process of local government extends to preventing the risk of "undue influence or the appearance of undue influence,"[8] and justifies differential treatment between professional business entities who may be seeking a no-bid contract and those who are already in the process of negotiating or performing a municipal contract. The risk of actual or perceived corruption is heightened when any amount of money is exchanged between a business that is in the process of negotiating the terms of a contract or a change order, and members of the City Council (as candidates or beneficiaries of party committee contributions), who have discretion over those terms in addition to payment, oversight and other aspects of performance.  

The trial courts concern, expressed in dicta (Pa141), that current professional service entities (when seeking renewal of a contact) are placed at a disadvantage with competing businesses that are permitted to make political contributions below a specified level, is thus unfounded.  It fails to appreciate the disparate positions of the two groups, and the compelling interest of the electorate to ban, not merely restrict, contributions between two parties in an actual quid pro quo relationship (in which negotiations for a new or renewal contract or change orders, and/or supervision of performance are ongoing, not merely prospective).  Furthermore, the power of incumbency, known performance, and existing contacts can be expected to offset the assumed power of limited contributions, and in fact result in the "qualification based, competitive negotiation procedures" that the Ordinance otherwise seeks to achieve only "through published rules and decision-making criteria." 20A-2 (Purpose of Art. I of Competitive Negotiation Ordinance, approved by the Mayor and Council, and quoted by Judge Gallipoli, (Pa141))

 Notwithstanding the above analysis, this court cannot simply rewrite a clearly written ordinance that is within the authority of the municipality to enact simply because it disagrees with certain policy choices embedded in the ordinance. In this case, the electorate has spoken clearly, precisely and in no uncertain terms.  Its ordinance must be construed as written and intended.

          C. The POG Ordinance is Enforceable

Defendants assert that Plaintiffs Complaint must be dismissed because the relief requested is not within the POG Ordinance. (Db54).  The trial court did not think this argument was worthy of consideration; and neither should this Court.

The statutory scheme is clear: once it is determined that political contributions to a candidate, party or continuing political committee have been received in excess of those permitted under the Ordinance, the City Council must declare an ongoing contract to be in breach and/or disqualify a professional business entity from eligibility for future contracts, in the event that performance is complete upon discovery of the violation,  20A-10 Penalty ("shall be a material breach" and "shall be disqualified").[9]  The City receives information of alleged violations through the reporting requirements imposed by the Ordinance, 20A-8, and implied monitoring of reports filed with the Election Law Enforcement Commission (ELEC).

Defendants ignore that someone within the Hoboken administration or someone who is controlling a campaign committee must notify the City Council of the alleged violation before it is able to impose penalties.  A violation can occur either when the City Council has entered into a new contract with a professional business entity that previously made contributions in excess of the limits set forth in 20A-6D, or when the Council is informed that a contribution of any size has been wrongfully made during negotiation of a contract or during performance of an existing one.

Accordingly, Defendants position that the relief requested by Plaintiffs is not contemplated in the Ordinance is dead wrong.  Furthermore, Plaintiffs brought this action against all the individual candidates of the Roberts Team, since once they became aware that contributions they received had been made by professional entities, as defined in 20A-6C, that held professional service contracts with the City, they each had an obligation to report such contributions to the City Council to enable it to impose the appropriate penalties.

D. Violations Of The Ordinance Are Continuing In Nature

      Not only was it appropriate for Plaintiffs to sue Councilman Cammarano and Councilwoman LaBruno (despite Defendants contentions otherwise, Db57), Defendants plea that their unlawful conduct cannot be remedied because of a "statute of limitations" (Db55-57) also misses the mark.  Defendants rely on R. 4:69-6 for the proposition that challenges to municipal decisions under this Ordinance must be made within 45 days of the date that ELEC publicly discloses the disqualifying contributions, and that there is an absolute bar to actions brought after that date.  Defendants are wrong on two counts, by misreading R. 4:69-6(a) and ignoring R. 4:69-6(c).

     The applicable rule requires mandamus actions to be commenced within "45 days after the accrual of the right to the review, hearing or relief claimed."  R. 4:69-6(a).  In many cases of municipal action, the time of the accrual of the right can be definitely ascertained as occurring on one specific day. 

Here, however, Plaintiffs Complaint alleges not just a single, discrete municipal action that starts the 45-day clock running, but instead two types of continuing violations: First, failure of the councilperson Defendants to notify the City Council of the alleged wrongful contributions,[10] and second, the failure of the City of Hoboken, pursuant to 20A-10, to declare that the affected contracts are in material breach, and thus to terminate the contracts if performance is still ongoing and/or to disqualify the contributor from future eligibility.  

      Therefore, each and every day that the City Council fails to declare the contract in material breach (or that a contribution recipient fails to report it), is a continuing violation, and not the single municipal act that is typically challenged in a prerogative writ action.  In fact, since a cure of an illegal contribution can occur up to 30 days after the general election next following the contribution (which here, would not have been until November 2005), no "statute of limitations" can even can begin to run until that date, because the contributor may take steps to "cure" the violation until that day has run. 20A-9.

      Defendants contention that all actions alleging violations of the POG Ordinance must be brought within 45 days after the ELEC reporting date of an unlawful contribution also makes no sense in the context of professional entities that make contributions in excess of the limitations set forth in subsection 6D, prior to entering into a professional service contract with the City.  In such circumstances, the obligation to report such contribution would not even arise until the contract was executed.

       Further, pursuant to R. 4:69-6(c), the 45-day limitation may be expanded "in the interests of justice."  More specifically, where there is an absence of a "sufficient crystallization of a dispute among firm lines to call forth the policy of repose" or an important public, rather than private, interest requiring adjudication or clarification, the 45-day limit should be relaxed.  See, e.g., Borough of Princeton v. Mercer Co., 169 N.J. 135, 152-53 (2001); Cohen v. Thoft, 368 N.J. Super. 338, 346-47 (App. Div. 2004). The continuing nature of the violations and the uncertain time periods in which one is able to obtain the very information on which a determination as to whether a violation has occurred can be made, (including the need to investigate whether a contributor is (1) a current municipal contract recipient, or (2) an affiliate of such recipient under 20A-6 or (3) an intermediary of a contract recipient under 20A-10), urge a relaxation of any 45-day limitation. 

      As an alternative, the Court should find that this case presents an "important public rather than private interest" and should therefore extend the limitations period on that basis.  Challenges to municipal action that implicate clean government and ethics, like this one, are generally perceived as raising an important public interest, justifying the extension of time.  See Haggerty v. Red Bank Borough, 385 N.J. Super. 501 (App. Div. 2006)(allegation of board members conflict of interest presents an issue of substantial public interest).  Since the claims at issue here challenge Hobokens continuing payment of municipal funds on contracts that may be illegal under its own ordinances, the action should be allowed to go forward.

For all the above reasons, Defendants argument that the entire Complaint must be dismissed because necessary parties cannot be joined within the statute of limitations is also misguided.(Db63).[11]

  III.SUMMARY JUDGMENT ON THE MERITS IS NOT APPROPRIATE

BECAUSE THE RECORD IS INCOMPLETE AND SUMMARY                   JUDGMENT IS PREMATURE.

 

         A quick glance at the relevant Order (Pa129-30) indicates that the trial court did not ""find the facts and state its conclusions of law thereon," as required by R. 1:7-4(a).  Its failure to make factual findings and correlate them with the relevant legal conclusions is simply because summary judgment on the merits of the case was not an alternative ground on which to dismiss the Second Amended Complaint. [12]

          Prior to the filing of Defendants Motion for Summary Judgment, Judge Gallipoli had stayed all discovery, and he thus knew that the factual record before him was incomplete. Under New Jersey law, it is firmly established that the court is to afford "every litigant who has a bona fide cause of action or defense the opportunity to full exposure of his case." Velantzas v. Colgate-Palmolive Co., Inc., 109 N.J. 189, 239 (1998).  It is especially inappropriate to grant such a motion where critical facts necessary to oppose it are within the moving partys knowledge (or are within the knowledge of third parties), and discovery remains incomplete (or as is this case, did not even commence). See, e.g., Billotti v. Accurate Forming Corp., 39 N.J. 184, 206 (1963); J. Josephson, Inc. v. Crum & Forster Ins. Co., 293 N.J. Super. 170, 203 (App. Div. 1996); Robsac Indus., Inc. v. Chartpak, 204 N.J. Super. 149 (App. Div. 1985).  For this Court to grant summary judgment on the merits of this case, would be to short-circuit Plaintiffs' efforts to prove the adequacy of their claims; and therefore, it is not an option. 

      Instead, because this action was in an early stage and was not fully developed, this Court ought to review the trial courts judgment terminating it from the standpoint of whether there is any basis upon which Plaintiffs should be entitled to proceed further.  Billotti v. Accurate Forming Corp., 39 N.J. at 193 (1963).  This is essentially what Plaintiffs argued below when they stated to the trial court that they were entitled to proceed with discovery in order to resolve certain material issues that they claimed were in dispute. (Pra6-9) [13]; see also R.4:46-5(a)(providing that summary judgment should be denied if the opponent of the motion sets forth that discovery is incomplete and that he expects to obtain information sufficient to defeat it through such discovery).

     Notwithstanding Plaintiffs omission to explicitly state that its complaint was not ripe for summary judgment, it would be inappropriate for this Court to resolve this case on a set of facts that are patently undeveloped and uncertain.  Remand and reinstatement of the Second Amended Complaint is the only appropriate course of action. 

          Generally, the factual basis for Plaintiffs Complaint is that a person who was a party to an existing municipal contract, or a person affiliated with them as defined under 20A-6C, or an intermediary of the contributor under 20A-10, made unlawful contributions of money to the "Roberts Team" or the Hoboken Democratic Party.  There are at least two contracts that Plaintiffs also allege are tied to unlawful contributions made prior to the entry of the contract. (Pa95, 99-100). 

            To defeat summary judgment, Plaintiffs were compelled to rely solely on the Certification of Ron Hine, Secretary of POG (Pa91), who based his personal knowledge on reports made to ELEC, and documents received from the City of Hoboken pursuant to the Open Public Records Act. (Pa91).[14] Such documents included professional service contracts, City Council Agendas and a list of vendor payments. (Pa92-92). 

     In some instances, however, these documents were not sufficient to demonstrate the connection between a particular contributor and a professional service contract, and Mr. Hine had to resort to the web, shared names and other resources to build a circumstantial case that the contributor was connected to a professional business entity in one of the many ways identified in 20A-6C of the Ordinance. He was successful in the following cases, but needs access to third parties through depositions or subpoenas in order to "determine the exact roles of the contributors [or their spouses or children] believed to be principals, partners, officers of companies [or subsidiaries thereof] holding no-bid contracts with the City." (Pra6)

Howard Birdsall/Birdsall Engineering: Federal Election Commission reports identify Howard Birdsall as the President and CEO of Birdsall Engineering. (Pa98) Birdsall Engineering had a contract to provide engineering services to Hoboken from June 1, 2004 to June 30, 2005. (Pa98)  During the term of the contract, Howard Birdsall contributed $300 to the Hoboken Democratic Party. This is admitted by Defendants.(Pa59-60)

 

Douglas Bern, Esq./Kaufmann, Bern & Deustch: On January 18, 2005, the Hoboken Zoning Board of Adjustment renewed its no-bid contract with Douglas Bern, Esq. of Kaufman, Bern & Deutsch for a period of one year. On April 18, 2005, during the term of the contract for legal services, Mr. Bern, who is a named partner in the firm, made a contribution of $1,500 to the Roberts Team. This is admitted by Defendants.(Pa60)

 

Arthur Amabile/Meadowlands Associates: On July 14, 2004, the City of Hoboken authorized a professional service contract with Meadowlands Associates for media and public relations consulting services, whose term runs from July 1, 2004 to June 30, 2005.(Pa96-7). Defendants do not deny the existence of this contract (Pa63).  A proposal attached to this contract identifies Meadowlands Associates, Inc. as a wholly owned by Anthony Amabile. (Pa97).  During the duration of the contract, on February 9, 2005, Mr. Amabile contributed $300 to the Hoboken Democratic Party. Id.

 

Gerald Perricone/PMK Group: On February 25, the City Of Hoboken entered into a no-bid contract with PMK to provide engineering services. Defendants admit this but the record is silent as to the term of the contract or whether PMK was still performing. (Pa62) On April 27, 2005, G. Perricone made a contribution of $1,600 to the Roberts Team, and according to PMK Groups website, he is one of four trustees on its Board of Directors. (Pa96). Plaintiffs need further discovery to establish whether the contribution was made during the term of the contract in addition to whether Mr. Perricone comes within subsection 6C of the Ordinance.

 

Elizabeth Vandor/Vandor & Vandor: On July 14, 2004, Hoboken awarded a no-bid contract to Vandor & Vandor to provide planning services for a term of one-year ending on June 30, 2005. During the term of the contract, Elizabeth Vandor made an $800 contribution to the Roberts Team. (Pa97) Plaintiffs have yet to establish if Ms. Vandor is a partner and/or owner of the firm Vandor & Vandor, and Defendants do not discuss this contribution in either their Statement of Material Facts (Pa54-64) nor Statement of Facts included in their brief. (Db18-19). Further discovery is warranted.

 

Ralph Tango/William Kersey/Schoor DePalma: Schoor DePalmer entered into two no-bid contracts with the City for architectural and engineering services for the time period at issue: July 14, 2004 to June 30, 2005 and December 15, 2004 to complete a project. (Pa93) On May 9, 2005, Ralph Tango and Robin Persad made a contribution of $1,600 to the Roberts Team. (Pa62).  One of the contracts identifies Mr. Tango as Senior Vice President of the firm. (Pa94).  On March 28, William Kersey, a principal of Schoor DePalmer, also made a contribution of $300 to the Hoboken Democratic Party. (Pa94). Contrary to Defendants Certification that Schoor DePalma did not receive a no-bid professional services contract after these contributions,(Pa63), Plaintiffs presented evidence that Robin Persad was appointed engineer of the City for a one year term running from June 1, 2005 to June 30, 2006. (Pa94). The record is incomplete as to the exact relationships of the three individuals to the professional business entity.   

 

Marchetto Caufield Associates/Dean Marchetto/James Caulfield, Sr./Robert Caulfield/James Caulfield, Jr./Rosemary Caulfied/Dean Marchetto Architects: The apparent familial and business relationships between the Caufields and the Marchettos and the high level of contributions made by the individuals sets this claim apart from all others.  On September 16, 2004, Marchetto Caulfied Associates entered into a professional service contract to perform architectural as well as construction administration work on a garage. (Pa59). Payments were made on this contract through June 29, 2005 to both Marchetto Caufield and Dean Marchetto & Associates. (Pa95)  During the month of May, several individuals with the name Caufield made several contributions to the Roberts Team amounting to approximately $12,500. Dean Marchetto also gave $800 during that time period to the Roberts Team. (Pa95).  Dean Marchetto Architects subsequently entered into a contract with the City for engineering design services on February 1, 2006. Id.  How all these entities are related to each other is yet to be determined, though Plaintiffs have raised enough evidence to be permitted to proceed with discovery.

 

Similarly, other claims raise material facts as to when or

if a contract was entered into between the City and the contributor identified by Plaintiffs in their Complaint:    

Dennis Galvin/Galvin Law Firm: Plaintiffs allege that Hoboken had a no-bid contract with Dennis Galvin for legal services during which term he made a $400 contribution to the Roberts Team. (Pa39-40).  Defendants do not deny this (Pa63) and make no mention of Mr. Glavin in the text of their brief. (Db18-19).  In their chart, however, they acknowledge that the contribution was made on May 17, 2005.(Db52). Plaintiffs need further discovery to establish the term of the contract they allege.

 

Steve Edwards/The Business and Government Insurance Agency:

Since July 1, 2001, the City has entered into no-bid contracts with Business and Government Insurance Agency (BGIA) for broker services. (Pa100).  Vendor reports show payments to such agency by the City throughout the fiscal year 2005, though Defendants deny that they had a contract with BGIA during that period of time; they merely assert that BGIA. was appointed Broker of Record effective February 3, 2005. (Pa60). Steve Edwards of BGIA made a contribution to the Roberts Team on April 12, 2005. (Pa100) Plaintiffs need further discovery to establish the nature of the contract for which payments were made and the exact nature of Steve Edwards relationship with BGIA.

 

Krivit and Krivit, P.C.: Since July 1, 2001, the City has authorized several professional service contracts with Krivit and Krivit.  The City did not provide Plaintiff with a contract for this firm for the fiscal year 2005; however, the City made payments of over $70,000 to this vendor. (95-96). The City does not deny that there is a contract. (Pa63).  On April 20, 2005, an unnamed party from Krivit and Krivit made a $1,600 contribution to the firm, and subsequently, the City awarded the firm with a no-bid professional service contract on September 21, 2005. (Pa96).  Plaintiffs need further discovery to establish that the contributions were made prior to completion of the contract and therefore are unlawful.

 

    The last and most controversial claim set forth in Plaintiffs Complaint involves the payment of significantly large contributions by the Election Fund of Senator Kenny and the Hudson County Democratic Organization ("HCDO"), of which he is the Chairman (Pa66), to the Hoboken Democratic Party Committee or the Roberts Team.  The Election Fund gave directly to the Roberts Team, but money flowed from the HCDO through the Hoboken Democratic Party Committee before it reached the Roberts Team.  Specifically, The Hoboken Democratic Party Committee transferred approximately $159,000 of its funds to the Roberts Team (Pa99) from February, 2005 through June 14, 2005.  Though innocent on its face, the factual complexity of the situation becomes apparent when one acknowledges that on July 1, 2001, and for each succeeding year, the City of Hoboken has entered into a no-bid professional services contract with Sarkisian, Florio & Kenny, of which State Senator Bernard Kenny is a partner, the latest of which was on July 20, 2005. (Pa99-100`).   

     Defendants argue that "[t]here is no allegation, nor could there be, that either the Election Fund or the HCDO is the alter ego of the law firm or of attorney-at-law Bernard Kenny, Esq." Plaintiffs do not have to establish that these candidate and party committees respectively are the alter egos of Senator Kenny or his firm to succeed on the merits of their claim; they rather must show, as they allege in their Complaint, that Senator Kenny or his firm used such committees as "intermediaries for the purpose of concealing or misrepresenting the source of the contribution." 20A-10.

     To meet this legal standard, Plaintiffs must be given the opportunity to conduct depositions and document discovery to understand the level of control and influence Senator Kenny exercises over payments made by these committees as well as contributions made by his law firm to these committees, if any.  Whether the Election Fund, the HCDO or the Hoboken Democratic Party Committee were in fact used as an intermediary for the purpose of concealment or misrepresentation is a fact sensitive issue that cannot be decided on an incomplete record, and requires exploration of the intent of those persons controlling or influencing the payment of contributions and/or transfers to the Roberts Team.

     Finally, Defendants contention that N.J.S.A. 19.44A-22(a)(2) and its regulations, provide the Election Fund of Senator Kenny and the HCDO with "the absolute right to make the contributions at issue," turns campaign finance law and the POG Ordinance on its head.  Political party, leadership, candidate, political action committees and the like are all permitted to solicit and transfer money to candidates and campaigns, but they must abide by all other applicable laws and regulations.  Furthermore, Plaintiffs are not contending that the committees violated any laws when making the transfer.  Rather, they seek to prove that Kennys professional business firm, through his partnership interest therein, unlawfully used the committees.  The trial judges precipitous decision to dismiss the Complaint on standing denied Plaintiffs the very opportunity to do so.

     For the foregoing reasons, summary judgment on the merits is premature and thus this Court cannot affirm the trial courts decision on such ground.

 

 

 

 

CONCLUSION

     For all the reasons stated above, Plaintiffs request that this Court grant Plaintiffs Appeal, reverse the trial courts Order dismissing the Complaint with prejudice, and remand the matter for reinstatement of the Second Amended Complaint, joinder of all necessary parties, and discovery.

                               Respectfully submitted,

 

                               Rene Steinhagen, Esq.                   

                               NEW JERSEY APPLESEED

                               PUBLICINTERESTLAWCENTER

 

 

Dated: December 11, 2006

 

 

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