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New Jersey Court Allows Developer to Sue for Damages for Bad Faith Appeals by Competitor

7/25/2017 | Articles & Alerts

New Jersey Court Allows Developer to Sue for Damages for Bad Faith Appeals by Competitor

In a landmark decision issued July 25, 2017, the New Jersey Superior Court, Appellate Division reversed the dismissal of an action by a shopping center developer seeking damages against a Shop-Rite supermarket owner (Ammons Supermarket, Inc.) and its attorneys (R.S. Gasiorowski, Esquire and Gasiorowski & Holobinko) based on Ammons and Gasiorowski’s filing of a pattern of sham litigation intended solely to prevent competition with Shop-Rite supermarkets within the State of New Jersey. The lower court had dismissed the shopping center developer’s claims for malicious abuse of process, tortious interference with prospective contracts and civil conspiracy, finding that Ammons and Gasiorowski’s conduct constituted protected first amendment speech under the Noerr-Pennington doctrine. 

Kaplin Stewart, representing the shopping center developer, successfully convinced the New Jersey Appellate Court that the defendants’ conduct fell within the “sham” exception to the Noerr-Pennington doctrine because the developer alleged that the defendants filed a series of objectively baseless land use appeals from the developer’s project, as well as baseless appeals of other development projects involving supermarkets, intended solely to prevent competition with Shop Rite supermarkets. 

By reversing the lower court, and allowing the developer’s case to proceed, the Appellate Court has opened the door for developers to sue third party objectors when they file baseless appeals for the improper purpose of preventing competition.

The New Jersey Appellate Court’s decision in Main Street at Woolwich, et al v. Ammons Supermarket, et al. has been approved for publication but has not yet been published. For a copy of this decision, please contact Marc. B. Kaplin, Esquire and Daniel R. Utain, Esquire at Kaplin Stewart Meloff Reiter & Stein, P.C. at (610) 260-6000 or mkaplin@kaplaw.com and dutain@kaplaw.com.

Authored by Wendi R. Kapustin (wkapustin@kaplaw.com). Ms. Kapustin is an American Institute Certified Planner.  Ms. Kapustin works in the firm’s Land Use, Zoning and Development Department.