A newly filed explosive whistleblower lawsuit reveals allegations of massive collusion between Jackson Mayor Mike Reina and certain big developers in the Township.

Specifically, the suit alleges that Reina and Business Manager Terence Wall repeatedly coerced the Township's building inspectors to massively "look away" for his important friends, and openly threatened to terminate their employment if they didn't do the dirty work they demanded.

The Complaint was filed in New Jersey Superior Court in Ocean County by Kevin Schmalz who served as the Plumbing Inspector and Sub-Code Official until October 2022.

According to the Complaint:

Schmalz began his employment at the Township in the position of Plumbing Inspector on January 2, 2001. In 2005, he also became the Sub-Code Official.

In 2019, the Township issued a major approval to Vito Cardinale of Cardinale Enterprises to develop Adventure Crossing. The reported $500 million Adventure Crossing project is located between Interstate 195 and Six Flags Great Adventure, and was planned to consist of a 120,000 square foot sports dome, two hotels, eight outdoor sports fields, a 100,000 square foot recreational building with a trampoline park, indoor go-kart racing, a venue for video game competitions, a 7-11 convenience store and restaurants, including a Popeyes restaurant and Taco Bell.

At the beginning of the Adventure Crossing project, Schmalz and other Building Officials were instructed by the Township officials, including Mayor Reina and Business Administrator Wall, to prioritize and expedite all inspections, reviews and approvals of plans and permits for the Project.

As the Project ensued, Schmalz and other Building Officials were harassed and even threatened with termination of employment if they did not approve certain applications, plan reviews and permits for the Project without question and in some instances, in clear violation of the Uniform Construction Code.

In February 2021, Brent O’Connor was hired by the Township to serve as its Construction Official. Shortly thereafter, Mr. O’Connor received directives from the Township to prioritize and expedite plan reviews and the issuance of permits for the Project, which eventually included instances when the issuance of permits was not warranted and in violation of the UCC. 

The Township, including Mayor Reina and Mr. Wall, regularly took orders and directive from the Developer, including directives that were not compliant with the UCC or other laws, and attempted to direct and coerce officials within the Building Department to act unlawfully. Additionally, Township introduced new and amended existing ordinances to reduce construction permit fees for the Developer on structure types that were being built at the Project, including the permit fees for domes and warehouses. 

Building officials would regularly object and refuse to participate in requests from the Developer, general contractors and Township officials that they believed to be unlawful. For example, in one meeting, the Developer offered to hire its own private inspectors to issue CO’s or TCO’s so that it no longer had to go through the Township’s Building Department. In another meeting, the Developer offered to provide the Township a “hold harmless” letter that it explained could allow the Developer and general contractor to build without appropriate permits or open with appropriate CO’s or TCO’s but that the Township could hold the Developer responsible for any liability that arose from the Project. 

As time went on, Schmalz and other Building Officials learned that construction had taken place with the Project without first obtaining the appropriate permits. Additionally, items were being installed beyond the scope of submitted site plans and without required inspections and permit updates. For example, construction of a dome began without first obtaining the necessary permits, including the permits required for the underground electrical work. Another example was the construction of a warehouse starting without the required inspections being completed or issuance of a permit. 

As work progressed, Mr. O’Connor met regularly with the Township’s administration and with the Developer. During these meetings, the Developer and Township officials would complain that the Building Department was not issuing permits when they wanted them to. Mr. O’Connor responded that the Building Department must follow the law and the only reason why permits would not be issued was because they could not be issued in accordance with the UCC and other applicable law. Mr. O’Connor further repeatedly explained the permitting process as required by law in these meetings. 

Mr. O’Connor informed Schmalz of these meetings and that they were under increased pressure from the Developer and Township to issue permits in violation of the UCC and he was threatened that he, Schmalz and others in the Building Department would be terminated if they did not comply with these unlawful directives.

Schmalz was harassed and threatened by certain Township officials concerning his refusal to issue permits for the Project that did not comply with the UCC. For example, at one point he was discussing with Mr. Wall the fact that the Township was hiring new employees at higher salaries than existing Township employees who had more experience and higher qualifications. During the meeting, in response to Plaintiff’s complaints, Mr. Wall stated, “guys in the Building Department have a bad reputation.” Schmalz understood Mr. Wall’s comment to be in response to the Building Department objecting and refusing to participate in unlawful conduct concerning issuing permits for the Project in violation of the UCC. Schmalz responded with something along the lines of, “I guess you expect us to just rubber stamp things.”

Mr. Wall became unhinged by Schmalz’s response and began mischaracterizing his statement to accuse him of threatening to “rubber stamp things.” Mr. Wall further expressly threatened Schmalz with termination and that he would do everything in his power to take away his licenses so that he could never be employed in his field anywhere else.

Schmalz told Mr. Wall to stop twisting his words and confirmed that he always performs his duties and responsibilities in accordance with the law. Mr. Wall became increasingly agitated and started yelling at him. Mr. Wall eventually slammed his books and left the meeting without resolving the salary discrepancies amongst new and existing employees within the Building Department.

Mr. Wall’s harassment and refusal to pay existing employees within the Building Department at appropriate rates was in further retaliation for Schmalz and other Building Department employees’ complaints and refusal to participate in unlawful conduct under the UCC and other applicable law.

On or about December 6, 2021, the general contractor for Taco Bell emailed Mr. O’Connor asking what documentation was outstanding for a Certificate of Occupancy (“CO”) to be granted so that Taco Bell could open to the public. The next day, Mr. O’Connor informed the general contractor that they needed to resolve an issue with the fire hydrant layout and inspections, which Mr. O’Connor had been asking the general contractor to do for two weeks. Mr. O’Connor also informed the general contractor that he was still required to address all issues, complete inspections, pay state mandated Council of Affordable Housing (“COAH”) fees, and secure final approvals. Mr. O’Connor also informed the general contractor would likely only receive a Temporary Certificate of Occupancy (“TCO”) with conditions, due to issues with the parking lot lights.

On or about December 20, 2021, Township officials, including Mr. Wall, pressured the Building Department to issue Taco Bell a TCO so it could open despite its several outstanding issues that made the issuance of a TCO unlawful. 

Around the same time, representatives from the Office of Regulatory Affairs (“ORA”) visited the Building Department office and the Project site. Mr. O’Connor was on vacation, so Schmalz was Acting Construction Official at the time.

The ORA representatives asked to review the permit files for Taco Bell and Popeyes. While the ORA representatives were in the Building Department office, the general contractor for Taco Bell entered the Building Department office and demanded a TCO be issued for Taco Bell immediately. 

Plaintiff responded to the general contractor that a TCO could not be issued because there was outstanding required documentation, including approvals from the Ocean County soils and site engineering and unpaid COAH fees.

The general contractor became increasingly belligerent and began arguing with Schmalz. In response to Schmalz explaining to the general contractor what needed to be done for him to issue the TCO, the developer threatened Plaintiff that if he was not issued the TCO, he would “open the restaurant” anyway. 

Unbeknownst to the general contractor, several ORA representatives were present during the confrontation and overheard the general contractor’s statements to Schmalz. After the general contractor left the office, one of the ORA representatives confirmed they overheard the conversation and warned Schmalz that they would hold him responsible if he issued the permits under these circumstances. Specifically, the Regulatory Affairs representative warned Schmalz, “If you issue the TCO, we are coming after you.” 

The following day, Mr. Wall confronted Schmalz in the door of the Zoning Office, and pressured him to issue the TCO, asking him “is there a way we get around this?” Schmalz responded no and explained to Mr. Wall that the general contractor did not provide the required documentation and therefore he legally could not issue the permit. 

Throughout the Project, priority inspections continued to be required by the Township. Schmalz did his best to abide by these demands. On or about June 7, 2021, the Popeyes’ developer asked him to inspect Popeyes’ plumbing the next day. Schmalz complied and inspected the Popeyes’ plumbing and approved the slab plumbing the same day as it complied with the UCC. On or about June 14, 2021, the Popeyes’ developer emailed Schmalz and asked him to move up the rough plumbing inspection that was scheduled for August 4, 2021. Schmalz complied, and Popeyes’ rough plumbing was approved on or about July 16, 2021. 

On or about December 28, 2021, and with issues still outstanding, Popeyes’ developer requested that the TCO be issued right away. Mr. Wall emailed Mr. O’Connor, asking him to expedite the TCO. While Schmalz was on site at Popeyes, he witnessed employees present in the restaurant and a line of cars at the Popeyes’ drive through. It appeared that based upon the people inside the restaurant and cars lining up at the drive through that the restaurant had opened without being issued a TCO. Schmalz called Mr. O’Connor and told him he had seen people in the restaurant and drivers lined up at the drive through. 

It was later determined that the premises were occupied for staff training and the cars waiting in the drive through lane, like Schmalz, believed they were open. Mr. Wall became irate and threatened that individuals in the Building Department would be punished for making false accusations. Mr. Wall sent an email wanting to know who was making false accusations against Popeyes and promised the general contractor he would get to the bottom of it.

Pressure continued to escalate from the Township to the Building Department officials to issue permits for the Project. According to Mr. O’Connor, the Developer was pressuring the Township in closed meetings to not delay the construction of the Project because of issues relating to permits. 

In or about late December 2021, Mr. O’Connor called an emergency meeting with the entire Building Department. In the meeting, Mr. O’Connor said that he had just come out of a meeting with Mr. Wall and Mayor Reina and was threatened that if the Building Department did not start approving the Developer’s permits, the entire Building Department staff would be terminated. 

Consistent with Mr. Wall and Mayor Reina’s threats of termination, the Township posted job openings for Plaintiff’s job, as well as the electrical, building, and fire Sub-Code/Inspectors and a Technical Assistant to Construction Official shortly after the meeting.

As work progressed on the Project throughout 2022, many inspections were not scheduled by the developers and work was performed on the Project without updates or permits. The Building Department was increasingly harassed by Township officials and falsely accused of holding up the Project.

Upon information and belief, Mr. O’Connor left his employment because of the harassment, retaliation and other unlawful conduct directed at him in connection with the Project.

Schmalz health began to significantly suffer because of the harassment and retaliation directed at him. He sought medical treatment for worsening anxiety due to the pressures the Township placed on him at work, including the threatening of his termination of employment if he failed to participate in what he believed to be unlawful conduct in connection with the issuance of permits. 

As a result of the unlawful conduct and hostile work environment being directed at him at work, he and other Building Officials decided to retain an attorney to protect their rights and employment. 

By letter sent to the Township on their behalf on February 18, 2022, the attorney set forth the factual basis for his claims against the Township, including by describing the unlawful business activities being undertaken by the Township in connection with the Project, the protected activity undertaken by him opposing and refusing to participate in same and the retaliation and harassment directed at him. The attorney further demanded that the Township stop taking any further harassing or retaliating actions immediately.

The letter warmed that Mayor Reina’s and Mr. Wall’s actions against Mr. Schmalz and the rest of the building department amount to retaliation, harassment and actions which rise to the level of causing a hostile work environment under New Jersey Conscientious Employee Protection Act.

Despite receiving the February 18, 2022 letter, the Township continued to pressure Schmalz and others to unlawfully issue permits, and harass and retaliate against Plaintiff for refusing to act unlawfully. 

In or about May 2022, Kevin Wyer was appointed Acting Construction Official for the Township. The Township placed Mr. Wyer in the position to increase the pressure, harassment and retaliation of Building Township officials to issue permits for the Project, regardless of whether they complied with the UCC and other relevant law. 

Upon his hire, Mr. Wyer began harassing and retaliating against Schmalz for engaging in protected activity.

On or about September 13, 2022, during an inspection, Schmalz discovered that one of the Project’s buildings was being used contrary to its permitted and approved use, without a CO and thus illegally. Specifically, he discovered that a building approved for maintenance use housed batting cages that were open to the public. Schmalz reported this violation to David Rudolph, the Township's Electrical Sub-Code Official.

Mr. Rudolph reported the violation to Mr. Wyer and Rich Wilton, who replaced Mr. O’Connor in the position of Construction Official.

Mr. Rudolph stated in his email to Mr. Wyer and Mr. Wilton, “as I have mentioned to you previously,” and then listed several UCC violations occurring at the Project site.

Mr. Rudolph instructed that a Notice of Violation (“NOV”) be issued and stated, “this is not the first time this has happened.” Mr. Wyer refused to issue the NOV contrary to the Township’s legal obligations to do so. Thereafter, Mr. Rudolph and Plaintiff were in contact with Scott Borsos, a representative of the New Jersey Department of Community Affairs (“NJDCA”) regarding their obligations to provide a NOV for this issue. Mr. Borsos confirmed that they were. However, Mr. Wyer continued to refuse to issue a NOV.

On or about September 29, 2022, Mr. Wyer approached Schmalz in the Building Department office and demanded that he sign off on the maintenance building that was improperly being used for the batting cages. Schmalz indicated to Mr. Wyer that two issues prevented him from signing off, namely a required update to delete a backflow device, and the building was in violation of the 
approved use. Mr. Wyer disregarded Plaintiff and repeated his directive to sign off on the CO. Schmalz told him he could not do so because of the issues that were present. Mr. Wyer became increasingly agitated and threatened him. Schmalz said the batting cages needed to be removed and the building needed to be returned to its approved use in order for the Township to issue a CO. Again, Mr. Wyer insisted Schmalz sign off despite knowing of the violation. He refused.

The next day, Mr. Wyer confronted Schmalz and told him that the batting cages had been removed and that he needed him to sign off on the CO. Schmalz stated he would need to personally verify the batting cages were removed. Mr. Wyer said that Schmalz did not have to do that since he (Mr. Wyer) had done it already. Schmalz responded that he would need to personally see as the licensed official on the permit.

Schmalz visited the site with the Fire Subcode Official. Upon returning to the office, after having verified that the building had been returned to its approved use, he signed off on the permit for the CO for the approved use of a maintenance building.

Schmalz sent Mr. Wyer a letter which reads, in relevant part:
Please be advised that the attached Notice of Violation has been issued and sent to the owner of the property noted in accordance with N.J.A.C. 5:23-2.30. This Notice of Violation is being issued after you were notified on September 13, 2022 and failed to act to address the violation with the owner. Because of this failure to act on your part in a timely manner to address the issue, the Plumbing Sub-Code can not be signed off until the outstanding violations are abated. This delay upon your part to act in a timely manner has caused a delay in issuing the Certificate of Occupancy. 
Once the outstanding violations are abated and verified, I will revisit issuing a Certificate of Occupancy for the plumbing.

Our conversation this morning in your office where you dismissed my concerns and pressured me to sign off the plumbing sub-code with known violations was found to be extremely unprofessional and unethical upon your part.

The following day, Mr. Wyer confronted Schmalz about the letter and complaints and specifically threatened him that he was “not going to have a job much longer.”

Schmalz emailed Marianne Horta, the Township's Human Resources Director, informing her of Mr. Wyer's retaliatory and threatening conduct. Ms. Horta did not respond to the email. In fact, neither Ms. Horta, nor anyone else from the Township, took any action to investigate Schmalz's protected complaints, including the written complaints he made to both Mr. Wyer and Ms. Horta.

On or about October 3, 2022, Schmalz filed a complaint with NJ Office of Regulatory Affairs regarding Mr. Wyer’s refusal to follow the UCC and issue a NOV against the Project for the illegal batting cages. Instead of investigating his complaints of harassment, retaliation and unlawful conduct on the part of the Township, Ms. Horta joined Mr. Wyer and the Township to take further retaliatory action against him!

On or about October 5, 2022, Schmalz was called into a meeting with Ms. Horta as well as Mr. Wyer, Mr. Wilton, and Plaintiff’s union representative. In the meeting, Plaintiff was issued a formal written discipline that included a five day suspension. In the written disciplinary notice setting forth the reasons for the adverse employment action, the Township admitted that the reason for taking the adverse action was because of his protected complaints. The written notice further warns Schmalz that further discipline up to termination will proceed if his protected conduct continues. During the meeting, Ms. Horta accused him of arguing with Mr. Wyer on or about September 29, 2022, regarding the illegal building use and Schmalz's refusal to sign off on it, stating “you were disagreeing with [Wyer].” Ms. Horta further admitted to him that the basis for the insubordination charge was because “there’s things that [Wyer] would ask you to do that you wouldn’t do.”

Ms. Horta then began falsely accusing Schmalz of being out of the office for long periods of time. Ms. Horta’s false accusations that he was out of the office for long periods of the day were presented to him as a pretext for retaliation. Schmalz explained that his job entails site work, which often requires him to be out of the office for extended periods, and it had been that way for the entire time he had worked at the Township. Ms. Horta responded that he would be made to clock in and out going forward.

While employed in his full-time position with Jackson Township, Schmalz was also employed in a part time position as Plumbing Inspector and Sub-Code Official for Plumsted Township.

Prior to taking the position with Plumsted, Schmalz informed Jackson that he had been offered the part time position with Plumsted to make sure they had no issues with him accepting the position. The Township told him that it did not have any issues with him accepting the part-time position with Plumsted as the part-time hours required by Plumsted did not conflict with his required hours at the Township. Schmalz began his employment with Plumsted in or about 2013.

At no time during his employment with Jackson and Plumsted was there any conflict that impacted his ability to perform the required duties and responsibilities of either position. Moreover, at no time prior to him engaging in any of the protected activity specifically set forth herein did anyone at the Township criticize him or claim that he was doing anything wrong in connection with his part time employment at Plumsted.

However, in retaliation for his complaints, and refusal to participate in what he reasonably believed to be unlawful business activities, the Township continued to retaliate against him, including by attempting to maliciously interfere with his part-time employment at Plumsted in further retaliation for him engaging in protected activity.

On or about July 19, 2022, the Township instructed outside counsel to submit an Open Public Records Act request to Plumsted for Plaintiff’s payroll records for the prior three years. The Township had no legitimate reason or basis to believe he had committed any wrongdoing in connection with his employment with Plumsted. The Township’s OPRA request was a fishing expedition to intimidate and retaliate against him for engaging in protected activity. All documents and/or other evidence obtained from Plumsted by the Township proved that Plaintiff had not committed any wrongdoing.

At his meeting Ms. Horta, she further threatened him that the Township was investigating him regarding his work for Plumsted Township. Ms. Horta accused him of falsifying his time sheets to state that he was working for Jackson and Plumsted at the same time because he was punching out of work for Jackson at 3:00 p.m. and punching into work for Plumsted at 3:01 p.m.

Schmalz responded that he is on the clock for Plumsted starting at 3:01 p.m., after he punches out of work for Jackson Township. Schmalz explained that Plumsted paid him for his travel to Plumsted because he regularly performed inspections on his way. Schmalz also explained that Plumsted was aware that his workday for them started as soon as he finished his workday at Jackson Township. Schmalz then handed Ms. Horta a letter that he obtained directly from Plumsted that expressly refuted her accusation that he had done anything wrong in connection with his employment with Plumsted by clocking into work at 3:01 p.m. Ms. Horta questioned him about what made him get the letter. Schmalz responded that he prepared the letter because he had been told that his work for Plumsted would be made an issue.

Despite his explanation of his work schedule and agreement with Plumsted, Ms. Horta continued to harass him, stating “you are here and then somewhere else at 3, and another job at 3?” Schmalz again explained that he began work for Plumsted at 3:01 p.m., after he punched out of work for Jackson at 3:00 p.m. Ms. Horta insisted that Mr. Wyer needed to be made aware of Schmalz's Plumsted work schedule. Schmalz responded that he did not work for the Township after 3:00 p.m. Ms. Horta continued to insist, “3:00 and 3:00” despite Plaintiff’s repeated explanations and the letter from Plumsted.

Ms. Horta then stated, “We just have to look into this going forward. When you need to leave except for your lunch one hour, please tell [Wyer] or Rich where you are going.” Schmalz responded that he would let them know in writing every day. Ms. Horta asked why he could not tell them verbally. Schmalz responded that he felt that he could not trust them. Ms. Horta responded that she was not making false accusations, and it was “a little arrogance” on Plaintiff’s part to think so.

Ms. Horta then asked Plaintiff, “why are you still working here?... If you don’t trust them, what is there to work for?” Schmalz responded that he had always been happy at his job, and it had only been in the past year or two that he was being asked to do things that were illegal and that he refused to do.

Ms. Horta asked, “you don't bring them up to administration?” Schmalz responded that he had. Ms. Horta asked Plaintiff if he had ever brought this up to herself or Mr. Wall. Schmalz responded that he had. He also stated that he had filed a complaint with the ORA against Mr. Wyer for attempting to coerce him into signing off on the illegal building use. Ms. Horta confirmed to Plaintiff that she was aware of his ORA complaint. She then attempted to coerce him into recanting his statement that the building had been used illegally and without the proper permits. Schmalz refused.

As the meeting continued, Ms. Horta continued interrupting and challenging Schmalz when he tried to explain what was happening within the Township and why he could not perform illegal tasks, telling him that he had a “problem with authority.” When the meeting ended, he was suspended without pay for one week.

The following week, on or about October 12, 2022, Plaintiff continued to seek medical treatment for his worsening anxiety. When he returned to work following his suspension, Ms. Horta began harassing him about his hours spent in the field. Upon seeing him place papers in the office recycling bin, Ms. Horta told him that he was not allowed to throw any papers out anymore. Ms. Horta then removed the recycling bin from the office and began to search through its contents.

Schmalz began experiencing chest pains and heightened anxiety because of the harassment and retaliation. He was treated in the Emergency Room and was ordered him to stay out of work. As a result, he was unable to continue medically to work at the Township and/or was constructively discharged on or about October 31, 2022.

After separation of his employment, upon information and belief, the batting cages were re-installed and re-commenced the illegal use without proper permits.

The one-count Complaint alleges violations of the New Jersey Conscientious Employee Protection Act (“CEPA”).

"As a result of the harassing and discriminatory conduct, Plaintiff has suffered economic damages, physical injury, emotional distress and continues to experience ongoing emotional distress and significant economic damages.

"Plaintiff’s disclosures, complaints and/or objections about Defendants’ violations and refusal to participate in unlawful activities or directives is protected under the New Jersey Conscientious Employee Protection Act.

"Plaintiff reasonably believed Defendants’ conduct was in violation of laws, rules and/or regulations; criminal; and/or incompatible with a clear mandate of public policy, including the UCC and other applicable laws. The adverse treatment of Plaintiff set forth herein, including the constant harassment, constant threats, the malicious interference into his employment with Plumsted, his 5 days suspension, constructive discharge, causing and/or exacerbating a mental health condition, and other unlawful conduct by the Township set forth herein, was in retaliation for Plaintiff’s complaints, disclosures and/or objections, refusal to participate and for retaining counsel.

"Defendants’ conduct was in violation of CEPA. Defendants engaged in, participated in, condoned, ratified, perpetuated and/or aided and abetted the CEPA violations. Defendants’ conduct and actions were malicious and/or undertaken with a wanton and willful disregard of and for Plaintiff.

"As a result of Defendants’ conduct, Plaintiff has suffered emotional distress, compensatory and other damages," wrote Homdel Attorney Christopher J. Eibeler, Esq.

The suit demands judgment for harm suffered as a result of the violations of CEPA as follows: 
A. Back pay and benefits;
B. Front pay and benefits;
C. Compensatory damages; 
D. Consequential damages;
E. Punitive damages;
F. Pre-judgment interest and enhancements to off-set negative tax consequences; 
G. Any and all attorney’s fees, expenses and/or costs, including, but not limited to, court costs, expert fees and all attorney’s fees incurred by Plaintiff in the prosecution of this suit (including enhancements thereof required to off-set negative tax consequences and/or enhancements otherwise permitted under law); and 
H. Such other relief as may be available and which the Court deems just and equitable.

The Township has 35 days to formulate an Answer to the Complaint.

Jackson Township is currently embattled in litigation by several past employees alleging CEPA violations.

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1 comment:

Anonymous said...

כל המחובר לטמא, טמא... רבי אליעזר אומר: לא לחינם הלך זרזיר אצל עורב, אלא מפני שהוא מינו.“ (בבלי, מסכת בבא קמא – דף צב, עמוד ב).

Avi Schnall is good friends with Reina