Opinion Summaries

     Plaintiff Bureau of Securities appeals from an order of judgment entered by the trial court after a proof hearing.  The Bureau filed a multi-count complaint alleging defendants violated the Uniform Securities Law, N.J.S.A. 49:3-47 to -89.  Plaintiff sought various avenues of relief including: an injunction against defendant Kizito and his affiliated businesses from further violations of the Uniform Securities Law; restitution to investors; and disgorgement of profits. Plaintiff also sought statutory monetary penalties.

     After an eight-day hearing, the trial court made findings and entered judgment, accompanied by an order and written statement of reasons.  The trial court found Kizito and one of his affiliated businesses jointly and severally liable for violating the Uniform Securities Law.  The trial court ordered restitution and imposed a statutory monetary penalty. Interpreting N.J.S.A. 49:3-69(a)(2), the trial court expressly declined to impose the remedy of disgorgement. The trial court determined instead that subsection (a)(2) should be interpreted to permit the remedy of restitution or disgorgement, but not both remedies on the same facts.

     Plaintiff appealed, arguing that N.J.S.A. 49:3-69(a)(2) authorized both remedies in the same enforcement action.  Applying well-settled principles of statutory interpretation to the Uniform Securities Law, the court held:  the statutory remedy of disgorgement may be applied by a trial court in tandem with the statutory remedy of restitution under N.J.S.A. 49:3-69(a)(2). 

Municipalities and municipal corporations, as defined by N.J.S.A. 1:1-2, that engage in frivolous litigation are subject to sanctions under the FLS. The Supreme Court of the United States has recognized “that municipalities, unlike States, do not enjoy a constitutionally protected immunity from suit,” Jinks v. Richland County, 538 U.S. 456, 466 (2003), and neither the FLS nor any other substantive law in New Jersey has immunized municipalities from FLS liability for filing frivolous pleadings like the Borough was found to have filed here. 

Whether defendant should have retreated was a critical part of certain offenses charged in this case. Jurors heard the State press the point at trial; they also heard conflicting accounts of who the “initial aggressor” was and whether the apartment was defendant’s “dwelling.” But the jury received no direction as to how those disputed facts related to -- or had the potential to negate -- the duty to retreat in this case. Under the circumstances, the failure to give the jury guidance on the castle doctrine was clearly capable of producing an unjust result. It was therefore plain error not to instruct the jury on the issue.

Because of the defect in Liberty’s PoA, El Sol did not submit a CoS that validly bound Liberty to execute the Contract Bond, and its bid was therefore incomplete. The NJTA did not act in an arbitrary, capricious, and unreasonable manner when it rejected El Sol’s legally deficient bid.

     This appeal presents a novel statutory construction question under the Overdose Prevention Act (OPA), which is designed to save lives by "encouraging people who witness or experience a suspected drug overdose to seek medical assistance. . . ."  N.J.S.A. 24:6J-2.  The OPA confers immunity to certain offenders charged with minor drug use/possession crimes that were discovered because police responded to a 911 call for medical assistance.  In this case, defendant's friend called 911 to report that she told him that she "wanted to commit suicide."  He also reported that defendant "uses crystal meth."  Defendant was charged with simple possession of a small amount of methamphetamine found in her wallet by hospital staff.
     Acknowledging that the OPA is a remedial statute to be interpreted liberally, the court probes the boundaries of the Act's definition of the term "drug overdose," focusing on whether the threat of suicide that prompted the 911 call was the result of defendant's use of a controlled dangerous substance (CDS).  The court stresses that the OPA's definition of "drug overdose" is broader than the common meaning of that term.  Notably, the statutory definition does not require that the subject is presently intoxicated or "under the influence" of a CDS.  Nor does the statutory definition require proof that the drug consumption occurred just before the acute condition arose.  The court therefore holds the OPA's plain language does not foreclose the possibility that a defendant might qualify for immunity based on their chronic use of a CDS, i.e., an addiction, provided the defendant proves the acute condition requiring medical assistance was the result of such prior CDS use.  The court also holds a psychiatric evaluation may constitute "medical assistance" within the meaning of the OPA, ruling that a person suffering from a psychiatric disorder is not categorically ineligible for immunity.  
     Because the trial court did not focus on the causal nexus between defendant's CDS use and her suicidal ideations, the court remands for a new hearing to address whether defendant can establish that the suicide concerns that prompted the 911 call were attributable to her methamphetamine use.
 

     In 2019, the Legislature enacted two laws, which amended and supplemented the statutes of limitations and procedural requirements for civil actions alleging sexual abuse.  See L. 2019, c. 120 (Chapter 120); L. 2019, c. 239 (Chapter 239).  As part of those amendments, the Legislature eliminated the notice requirement in the Tort Claims Act (TCA), N.J.S.A. 59:1-1 to 12-3, for victims of sexual abuse.  See Chapter 120, § 8 (codified at N.J.S.A. 59:8-3(b)).  The Legislature also expanded the type of persons and entities that can be liable for sexual abuse by amending the Child Sexual Abuse Act (CSA Act), N.J.S.A. 2A:61B-1, to eliminate the requirement that a passive abuser be "within the household" of the victim.  See Chapter 120, § 4.
     The court holds that the 2019 amendment eliminating the notice requirement in the TCA applies to common law claims that are directly related to the sexual abuse of a minor.  The court also holds that the 2019 amendment to the CSA Act, which eliminated the "within the household" requirement, applies to any action filed after December 1, 2019, and that it is not limited to claims that accrued after December 1, 2019.
    Accordingly, in this matter, the court affirms a November 30, 2023 order denying partial summary judgment to defendants Warren Hills Board of Education (the Board) and Warren Hills Junior High School (the Junior High School).  The Board and the Junior High School had moved for partial summary judgment, arguing that plaintiff's common law claims should be dismissed because he did not file a timely notice of claim under the TCA, and they were not subject to liability under the CSA Act.  The court also affirms an April 11, 2024 order denying the Board's and the Junior High School's motion for reconsideration.
 

     The court affirmed the PCR court's denial of defendant's Strickland-based ineffective assistance of counsel claims and concluded:  (1) subsections (a) and (b) of N.J.S.A. 2C:24-4(b)(1) do not violate the First Amendment to the United States Constitution because they criminalize the possession and distribution of child pornography and are neither overbroad nor vague.  To the extent this conclusion regarding subsections (a) and (b) is contrary to the decision in State v. Higginbotham, 475 N.J. Super. 205 (App. Div. 2023), aff'd in part, rev'd in part, 257 N.J. 260 (2024), the court expressly rejects the holding in Higginbotham; and (2) the State's investigation and subsequent prosecution did not violate the Ex Post Facto Clauses of the United States and New Jersey Constitutions.  

     Plaintiffs brought claims against defendant, owner of a resort property in Atlantic City, alleging violations of the Consumer Fraud Act (CFA) and the Real Estate Timeshare Act (RETA).  After a trial, the jury found defendant liable to plaintiffs under both the CFA and RETA and awarded damages under both statutes.  After merging the verdicts, the trial court awarded treble damages under the CFA, as well as attorney's fees and prejudgment interest against defendants.  Defendant appealed.
     On appeal, the court held that:  the parol evidence rule did not bar plaintiffs from introducing evidence of fraud during trial; plaintiffs were permitted to bring claims pursuant to the CFA and RETA simultaneously; RETA and its accompanying regulations require that a purchaser be given a reasonable opportunity to review a public offering statement; the trial court did not err by submitting a question of contract interpretation to the jury; the trial court did not err by permitting evidence of defendant's alleged RETA violations to go to the jury nor did it present those violations as separate causes of action upon which damages could be award; and finally, the trial court did not err when it increased plaintiffs' attorney's fee award after reconsideration.
 

     The court granted defendant Mohammad Ramadan leave to appeal from the Law Division's April 4, 2024 order denying his motion to dismiss count two of an indictment charging him with first-degree attempted murder, N.J.S.A. 2C:5-1, 2C:11-3.  Defendant argued the prosecutor gave the grand jury the wrong legal instruction, advising that an attempt to purposefully cause "serious bodily injury resulting in death" constituted a sufficient alternative mental state for the offense of attempted murder.  Defendant claimed this error warranted dismissal of the attempted murder count.
     The court determined that providing the grand jury with incorrect mental state instructions, even though also presenting statements of the correct mental state, created the inherent possibility that the grand jury indicted defendant for attempted murder based on an impermissible mental state.  The court cited State v. Gilliam, 224 N.J. Super. 759 (App. Div. 1988), which reversed an attempted murder conviction based upon a similar misstatement of the required mens rea.  
     The court reversed the trial court's order and dismissed the count of first-degree attempted murder.
 

     In this Medicaid lien dispute, plaintiff Estate of Leonor R. Dizon (Estate), by its administrator ad prosequendum, Teresa Finamore, appealed from a Law Division order denying its application to extinguish the Division of Medical Assistance and Health Services' (Division) lien asserted against the Estate's assets pursuant to N.J.S.A. 30:4D-7.2 (estate asset statute).  
     The Division's lien sought the recovery of $214,391.95 in Medicaid benefits Dizon (decedent) received after turning fifty-five years old.  The Division filed its lien against all the Estate's assets, including any award the Estate received from its pending survivorship action, N.J.S.A. 2A:15-3.  The Estate disputed that a survivorship award was subject to a Division lien under the estate asset statute for all of decedent's Medicaid benefits paid, arguing that its interest in the survivorship claims did not constitute property of the estate at the time of decedent's death, as required by the statute.  Instead, it contended, the Division was only entitled to reimbursement from an award for decedent's tort-related medical expenses for her injuries pursuant to a separate statutory provision specifically addressing third-party liability recovery, N.J.S.A. 30:4D-7.1.  
     The court concluded the Division's lien was valid against all the Estate's assets under the estate asset statute, which included any survivorship action award, and therefore affirmed the trial court.  
 

The DEP’s initial grant of the waiver did not create a property interest in the continued suspension of Clarios’s remediation obligations. Neither the controlling statutes and regulations nor a mutually explicit understanding between the parties provided an entitlement to the indefinite continuance of the waiver; to the contrary, the governing laws and agency materials all anticipate the DEP’s ability to enforce remediation obligations in the future.

     Appellants, Central Regional Board of Education (Board) members Ronald Donnerstag, Kristin Lanko, Lisa Snider, Wendy Vacante, Matthew Delprete, Patricia Fortus, Jaime Cestare, Scott Alfano, and Lynne Sweezo, appeal the School Ethics Commission's final agency decisions dismissing their twelve-count complaint under the School Ethics Act (Act), N.J.S.A. 18A:12-21 to -34, seeking disciplinary action against fellow Board member, respondent Merissa Borawski.  Appellants' allegations targeted Borawski's posts and repost uploaded to her public social media account while she was a Board member-elect and a Board member regarding labor union membership, COVID-19 mandates, and State gender identity curriculum.  In addition, appellants allege Borawski violated Governor Philip Murphy's Executive Order 251 by not wearing a facemask at a public Board meeting while a Board member.  
     The court affirms the Commission's grant of Borawski's motion to dismiss allegations in counts one, two, three, four, five, eight, nine, ten, eleven, and twelve that she violated N.J.S.A. 18A:12-24.1(a) regarding her social media posts and reposts criticizing COVID-19 mandates and gender identity curriculum, and non-compliance with Executive Order 251.  The Commission correctly determined appellants failed to comply with N.J.A.C. 6A:28-6.4(a)(1) because there was no order issued by a court or administrative agency that Borawski violated state law or regulations.
     The court affirms the Commission's grant of Borawski's motion to dismiss allegations in counts six and seven that she violated N.J.S.A. 18A:12-24.1(e) regarding her social media posts and repost criticizing COVID-19 mandates and applauding the acquittal of an alleged racist.  The Commission correctly determined that it did not have jurisdiction under the Act over Borawski's posts because the posts were made when she was a Board member-elect.
     The court reverses the Commission's grant of Borawski's motion to dismiss allegations in count three that she violated N.J.S.A. 18A:12-24.1(e) by not complying with Executive Order 251, and remand for the Commission to address the merits of the count.  The Commission arbitrarily determined Borawski's conduct was not a nexus with her role as a Board member and did not have the potential to undermine the authority of the Board.
     The court affirms the Commission's summary decision finding that the allegations in counts two, four, five, eight, nine, ten, eleven, and twelve did not violate N.J.S.A. 18A:12-24.1(e).  There was no evidence Borawski's conduct compromised the Board. 
     The court reverses the Commission's summary dismissal of Borawski's allegations in count one that she violated N.J.S.A. 18A:12-24.1(e) regarding her social media post challenging labor union membership and remand to the Commission to determine the appropriate penalty.   The Commission's decision was arbitrary, capricious, and unreasonable as it was contrary to the credible evidence in the record that the post compromised the Board because it resulted in an unfair labor practice charge being filed against the Board.  We remand to the Commission to recommend to the Commissioner of Education the extent of Borawski's penalty.
 

     Appellants, Central Regional Board of Education (Board) members Ronald Donnerstag, Kristin Lanko, Lisa Snider, Wendy Vacante, Matthew Delprete, Patricia Fortus, Jaime Cestare, Scott Alfano, and Lynne Sweezo, appeal the School Ethics Commission's final agency decision dismissing their five-count complaint under the School Ethics Act (Act), N.J.S.A. 18A:12-21 to -34, seeking disciplinary action against fellow Board member, respondent Heather Koenig.  The allegations targeted Koenig's posts and reposts uploaded on her public social media account while she was a Board member-elect and Board member, and her violation of Governor Philip Murphy's Executive Order 251 by not wearing a facemask at a public board meeting while a sitting Board member.  
     The court affirms the Commission's dismissal of counts two and five when it granted Koenig's motion to dismiss.   The Commission correctly determined count two failed to comply with N.J.A.C. 6A:28-6.4(a)(1) because there was no order issued by a court or administrative agency finding that Koenig violated state law or regulations when she did not wear a mask at her Board member swearing-in.  The Commission correctly determined count two's allegation that Koenig violated N.J.S.A. 18A:12-24.1(e) did not establish she was acting on behalf of the Board or compromised the Board.   The Commission also correctly determined it did not have jurisdiction under the Act over the allegations in count five that she violated N.J.S.A. 18A:12-24.1(e) because the social media posts were made when Koenig was a Board member-elect, not a sitting Board member.
     The court reverses the Commission's dismissal of count three when it granted Koenig's motion to dismiss.  The count alleges Koenig violated N.J.S.A. 18A:12-24.1(e) by not wearing a face mask at a Board meeting because she compromised the Board as her action was perceived to be speaking for the Board and may have encouraged others to follow suit.  The Commission's decision was arbitrary, capricious, and unreasonable. The allegation is remanded to an Administrative Law Judge to conduct a fact-finding hearing and issue an initial decision to the Commission.  
     The court affirms the Commission's summary dismissal of count four alleging that Koenig's social media post and reposts criticizing the Governor's mask mandate violated N.J.S.A. 18A:12-24.1(e).  There was insufficient nexus between her conduct and her position as a Board member, and there was no indication that the Board was compromised by this conduct.
     The court reverses the Commission's summary dismissal of count one alleging that Koenig's social media post encouraging Board employees to rescind their membership in their labor unions violated N.J.S.A. 18A:12-24.1(e). The dismissal was arbitrary, capricious, and unreasonable as it was contrary to the credible evidence in the record that the post compromised the Board by resulting in an unfair labor practice charge filed against the Board.  We remand to the Commission to recommend to the Commissioner of Education the extent of Koenig's penalty. The penalty, however, shall not be imposed until the Commission makes a final agency decision regarding count three.
 

     A jury convicted defendant on several offenses, including two counts of second-degree terroristic threats, N.J.S.A. 2C:12-3(a).  The terroristic threats convictions related to statements defendant directed at the victim, who presided as the judge over defendant's municipal court case.  Defendant was also convicted of making the threats during a declared period of national, State or county emergency, namely, the COVID-19 pandemic.
    Defendant argued the terroristic threats convictions should be reversed because the jury was not charged pursuant to State v. Fair, 256 N.J. 213 (2024), on whether a reasonable person similarly situated to the victim, in this case a municipal court judge with several years of experience as an attorney and a prosecutor, would have viewed defendant's words as threatening violence.  Defendant also raised an as-applied substantive due process challenge to his conviction for making the threats during a declared emergency, arguing there was no nexus between his threats and the state of emergency. 
    The court reversed the terroristic threats convictions and ruled Fair has pipeline retroactivity.  Although defense counsel seemingly argued the Fair standard in summations, the trial court charged the jury under the then-existing model charges, which did not provide an objective means of measuring whether defendant's statements constituted terroristic threats.  
     The court also held where the State seeks to enhance a third-degree terroristic threats offense by charging a defendant with making threats during a declared period of national, State or county emergency, there must be some rational relationship between the threats and the underlying emergency.  Otherwise, the conviction will be vulnerable to an as-applied challenge for vagueness on substantive due process grounds.  Reversal was warranted here because the threats defendant directed at the victim did not result from or having anything to do with the pandemic or pandemic-related restrictions, and his municipal court case.
 

     As a matter of first impression, the court addressed the procedural issue of whether the trial court properly entertained plaintiffs' motions to dismiss after they had filed an answer to defendant's counterclaim asserting a defense under Rule 4:6-2(e) or whether plaintiffs were required to file the motion prior to filing their answer.  The court concluded the trial court correctly considered the motion under Rule 4:6-2.  It determined that Rule 4:6-2, when read in conjunction with Rule 4:6-3, contemplates that a party who raises a Rule 4:6-2(e) defense in its answer will be permitted to make an application to the court prior to trial in much the same way as a motion for summary judgment.
    The court also addressed whether, in considering defendant's counterclaims for defamation and trade libel, the trial court properly determined plaintiff's statement that defendant was a criminal or engaged in criminal behavior was substantially true and therefore a defense to these causes of action, even though defendant was never convicted of a crime. The court concluded that a conviction is not necessary to render substantially truthful a statement that a person was a criminal or engaged in criminal behavior, and defendant's admissions during her testimony in an underlying federal criminal prosecution rendered plaintiff's statements substantially true irrespective of whether there is a record of a successful prosecution against her.
 

STATE TAXATION – TOBACCO AND VAPORS PRODUCT TAX
Tax Court: Barrister Cigars, LLC v. Dir., Div. of Taxation, Docket No. 009089-2022; opinion by Sundar, P.J.T.C., decided April 1, 2025.  For plaintiff - Matthew D. Lee, Esq., Jonathan M. Wasser, Esq. (Fox Rothschild, LLP, attorney); for defendant - Michael J. O’Malley, Deputy Attorney General (Matthew J. Platkin, Attorney General of New Jersey, attorney).

Held: Plaintiff, a retailer but also a “distributor” as that term is defined by the Tobacco and Vapors Product Tax (“TPT”) Act (“TPT Act”), is not barred from using the “wholesale price” as the base for computing its TPT liability simply because it does not purchase tobacco products directly from the manufacturer.  However, because “wholesale price” is statutorily defined as the “actual price for which a manufacturer sells tobacco products to a distributor,” plaintiff cannot use estimates provided by its suppliers as the base for computing its TPT liability.  Plaintiff should be given an opportunity at trial to prove the “wholesale price” of its tobacco purchases for the tax years at issue with objective and credible evidence.  Therefore, the court denies both parties’ summary judgment motion on this issue.

In addition, there is no statutory authority for a distributor to deduct estimated federal excise tax from the tax base.  Therefore, the court grants defendant’s summary judgment on this issue.

(29 Pages)

The Court disagrees with the Appellate Division’s conclusion that it was the arbitrator, not the parties, who introduced the question of carried interest in the arbitration. The remedy of modification under N.J.S.A. 2A:23B-24(a)(2) is not warranted in this case, and the Appellate Division’s review of the award did not conform to the deferential standard governing judicial review of arbitration awards

     This appeal raises a question of first impression under New Jersey law, requiring the court to consider the interplay between the right against self-incrimination, the right to privacy in one's home and effects, and the right to the assistance of counsel.  Following defendant's arrest for assaulting his daughters, police administered Miranda warnings and defendant asserted his right to confer with an attorney.  The interrogation process immediately ceased.  Police went back to the still detained defendant a few hours later and asked him to consent to a search of his home, which he granted.  Defendant contends that police did not scrupulously honor his earlier request to consult with an attorney, rendering his consent invalid.  
     The court surveyed cases in other jurisdictions and analyzed different options for how to account for defendant's request to confer with an attorney:  (1) treat the prior request as a factor in the totality-of-the-circumstances test used to determine whether consent was given voluntarily; (2) require police when asking for consent to clarify whether a prior request to confer with counsel pertained only to the right against self-incrimination and not to the waiver of other constitutional rights; or (3) treat the prior request to confer with an attorney as a per se bar from asking for consent.  After considering the heightened protections accorded to suspects in custody under the New Jersey Constitution and common law, New Jersey's history and tradition of honoring the protective role that defense attorneys play, and the stricter rules in this State for proving the validity of a consent search, the court establishes a bright-line rule to provide clear guidance to police:  when a person in custody asks to speak with an attorney, police may not thereafter ask the arrestee to consent to a search when there has been no break in custody.  Doing so renders the consent presumptively involuntary.  
     In this case, the trial judge found that the State met its burden of proving the elements of the inevitable discovery exception to the exclusionary rule by clear and convincing evidence.  The court finds no error in the trial judge's application of the inevitable discovery doctrine and affirms defendant's convictions for unlawful possession of the assault firearm and large capacity ammunition magazines police found when executing the consent search.
     The court also affirms defendant's conviction for endangering the welfare of a child, rejecting defendant's contention the trial judge erred in instructing the jury by failing to sua sponte redact language in the model jury charge not pertinent to the evidence presented by the prosecutor.  The court, however, reverses and remands for a new trial on the downgraded simple assault charges because the judge did not adequately respond to a question posed by the jury concerning a parent's authority to use corporal punishment.

     The primary issue addressed by the court in this appeal is whether the indictment of a partner in a law firm, who withdrew his appearance following the indictment, creates a conflict of interest requiring the law firm to be disqualified from representing defendants, the State of New Jersey and other State entities.  Because the underlying indictment was not related to the Conscientious Employee Protection Act, N.J.S.A. 34:19-1 to -14, and contract claims filed by plaintiff in the civil action, the court concluded no conflict of interest existed pursuant to the Rules of Professional Conduct or the Office of the Attorney General, Outside Counsel Guidelines (2022).  The court affirmed the trial court's order denying plaintiff's motion for disqualification.

REALTY TRANSFER FEE – REFUND CLAIM OF 1% GRANTEE FEE - FARM – MANSION TAX

Tax Court: Matrix Bordentown, Lot 2, LLC v. Director, Division of Taxation, Docket No. 013007-2019; opinion by Bedrin Murray, J.T.C., decided March 25, 2025.  For plaintiff – Joseph G. Buro (Zipp & Tannenbaum, LLC, attorneys); for defendant – Anthony D. Tancini (Matthew Platkin, Attorney General of New Jersey, attorney).

Held:  Plaintiff challenges defendant’s denial of its claim for refund of the one percent realty transfer fee imposed on a grantee in transfers greater than $1,000,000 for certain classes of real property. In cross-motions for summary judgment, the parties urge contrary interpretations of N.J.S.A. 46:15-7.2(a)2(a), which imposes the fee upon the transfer of Class 3A farm property that includes a building or structure “intended or suited for residential use.” The fee includes any other real property transferred to the same grantee in conjunction with the 3A farm property.  N.J.S.A. 46:15-7.2(a)(2)(b). In this matter, plaintiff purchased the property to develop as an industrial site. The transfer consisted of three subparcels, including a half-acre lot containing a vacant and dilapidated farmhouse which plaintiff intended to demolish. At deed recordation, plaintiff was assessed a transfer fee of one percent of the total deed consideration of $4,703,160 based on the existence of a structure intended for residential use on the 3A farm parcel. Plaintiff contends that by “intended”, the Legislature meant the intent of the grantee as to the future use of the farmhouse, and that by “suited for”, the Legislature meant suitable for habitation. The court concludes that the plain language of the statute militates against this interpretation. Further, it is not reasonable to conclude that the Legislature intended for the application of the 1% fee to be decided based on subjective measurements. Moreover, defendant’s interpretation of tax statutes carries a presumption of validity. Provided defendant’s application of tax statutes is not plainly unreasonable, the court shall accord due deference to same. Summary judgment is granted in favor of defendant. Plaintiff’s complaint is dismissed with prejudice.  

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