Plaintiff and Attorneys Who Sued Gov. Phil Murphy Testify About Devastating Loss of Her Business

Jennifer Jean Miller: (973) 532-2117

“What we learned is that Gov. Murphy has not appointed any person to any compensation board in any county in the state." -Catherine M. Brown, Esq

(Morris Plains, NJ) Darlene Pallay, who sued Gov. Phil Murphy for his violation of the Disaster Control Act, testified in front of a panel of legislators recently about two events that have caused her family an unforgettable amount of “pain, anguish, fear, devastation and uncertainty,” the first, the loss of her healthy father to a rare cancer in 2015; and the second, the death of her successful, decade-old business in 2020, within nine months of the first back-to-back COVID-19 lockdowns.

Pallay, who testified with her pro bono attorneys Robert W. Ferguson, Esq. of the law firm of Stern, Kilcullen and Rufolo, LLC of Florham Park and Catherine M. Brown, Esq., of Denville, the legal team who filed a lawsuit on her behalf against Murphy on Sept. 23, told the participating Republican New Jersey State Senate and Assembly panelists – Democrat legislators declining to attend the hearing – about the loss of her “American Dream.”

“I seek justice for what has been done to my family, I followed every rule I was supposed to follow and have paid dearly for that, while so many have actually benefitted from these lockdowns,” Pallay said.

“One of the themes of our lawsuit is that it is both tremendously unfair but also unlawful to ask a small subset of private citizens to pay for these benefits that the governor believes will accrue for the benefit of everybody,” Ferguson said.

“A subset of New Jersey’s small business owners, were asked and compelled by force of law to put their livelihoods on the line and in some cases, sadly like in Mrs. Pallay’s, they lost their livelihoods.” Ferguson called it both unlawful and unconstitutional under the Disaster Control Act, for Murphy to have asked, “for those aggrieved citizens, to shoulder 100% of this immense burden.”

Instead, Ferguson and Brown, their suit facilitated by the non-profit advocacy group Rescue NJ New Jersey, stated under the Act, which Murphy wrote into his early executive orders, Murphy was required to establish compensation boards in every county, but never did. With these boards, businesses deemed “non-essential” as Pallay’s was, could petition for “reasonable compensation,” for the taking of their property.

However, they said in one of Murphy’s later executive orders, he demonstrated this principle by mandating compensation to medical facilities that have been required to transfer equipment to other facilities during the pandemic.

“The statute requires that the governor empanel emergency compensation boards in each county and so what we tried to do, on behalf of Mrs. Pallay, and really for the benefit of all small business owners who are similarly situated, was to file a petition on her behalf with the emergency compensation board in Sussex County,” Ferguson said.

"What we learned is that Gov. Murphy has not appointed any person to any compensation board in any county in the state.

The case, Ferguson explained, does not challenge Murphy’s COVID-19 mitigation strategies, but asks that these compensation boards are established, as required by statute.

Ferguson and Brown additionally asked for the Appellate Division – where the case has remained for several months after it was transferred from the Superior Court - to expedite Pallay’s case, following the loss of her business, which has been further exacerbated by the loss of her husband’s job, a request the Appellate Division has denied.

Murphy’s attorneys responded to the plaintiff’s legal arguments on March 22, as part of the legal proceedings, not giving an explanation why the governor failed to establish compensation boards, but asserting instead the case should be dismissed, claiming the state is not obligated to provide compensation while operating under police power during a public health emergency.

Murphy’s attorneys responded to the plaintiff’s legal arguments on March 22, as part of the legal proceedings,not giving an explanation why the governor failed to establish compensation boards, but asserting instead the case should be dismissed, claiming the state is not obligated to provide compensation while operating under police power during a public health emergency.

Ferguson and Brown will file their reply with the Appellate Division on April 1.

As she struggled to hold back her tears, Pallay explained that her business, JWC Fitness LLC., under which she operated the CKO Kickboxing Franklin franchise, enabled her to devote time to her husband and three children, while building a cornerstone business that made a difference in the community. CKO Kickboxing Franklin frequently fundraised for various charities; and Pallay received Congressional recognition “for COVID-related activities that benefitted her community,” while she was shut down.

“Thousands of women and men not only lost weight, but were able to kick drug habits, get off life-long medication, participate in amazing physical feats that they never dreamed possible,” Pallay said.

“We were literally a fitness family. And I submit to you, we were essential."

Each day became one to attempt to save her business, with no income for months, but the expectations to pay operating and general business expenses.

She received few benefits from the PPP program with only part-time employees. Pallay used what little she received to compensate her staff and then pay 40% back rent, utilities and other expenses that she owed, for a facility the State of New Jersey forbade her to use.

“The confusion, lack of direction, lack of planning in the entire government left me to fend for myself,” Pallay said. “I did everything I could to save my business.”

She had difficulty drumming attendance among her former 200 regular members when she attempted online classes; and when Murphy finally permitted businesses like Pallay’s to hold outdoor fitness classes beginning on June 26, 2020, the sweltering summer heat made it impossible at times.

After the state allowed indoor classes with a 25% capacity and mask restriction in September, Pallay’s landlord filed for eviction on Sept. 11; and though she attempted to salvage her business, the restrictions and general fear, kept her former members from attending.

Her landlord told Pallay he planned to shut the water off in November, which would make it impossible to operate, with Pallay deciding to close her doors for good on Oct. 31.

Since she has lost her business and lives with the angst of her eviction proceedings, Pallay said she has struggled with depression, social anxieties, headaches and panic attacks, with debt mounted more than $50,000, the family’s home and health insurance in peril.

“Rescue New Jersey helped to facilitate this lawsuit and I’m very proud of the testimony of Mrs. Pallay’s attorneys,” said Donald Dinsmore, Esq., Rescue New Jersey’s chairman.

“They are volunteering their expertise without compensation, to help safeguard the Constitutionally protected rights of New Jerseyans like Mrs. Pallay, who were asked to carry a greater burden than others during the pandemic.”

To view the hearing, visit: www.facebook.com/senatenj/videos/190003732899353. For more information about Rescue New Jersey and this case, go to: www.rescuenewjersey.org.

Appellate Division Denies Request to Expedite Case for Shuttered Business

CONTACT:
Jennifer Jean Miller | (973) 532-2117

(Morris Plains, NJ) The Appellate Division denied a request on Thursday to expedite proceedings for a New Jersey business that closed its door because of Gov. Phil Murphy’s back-to-back emergency COVID-19 executive orders, which have since resulted in the closure of more than one-third of the state’s small businesses. According to the order from Judge Carmen Messano in the case of JWC Fitness LLC versus Murphy, the case was denied an accelerated hearing for Murphy’s failure to properly execute the Disaster Control Act, which he invoked in his March Executive Orders and deemed some businesses “non-essential,” including the plaintiff’s CKO Kickboxing Franklin. In spite of her plight, Murphy asked the Appellate Division to deny counsels’ request to move the case quickly, which would have assisted plaintiff Darlene Pallay in seeking financial relief.

Although Messano’s order specified he would not expedite the case and the parties will next receive a briefing schedule to file their written arguments, he did not deny that the first claim pertaining to establishment of the Disaster Control Act, should be argued in the Appellate Division. He did, however, state the second and third claims that argued Federal and State Constitutional issues of “taking” requiring compensation, should return to the Superior Court, where the complaint was first filed on Sept. 23.

“The entry of this order is without prejudice to plaintiff’s ability to seek relief in the Law Division at the appropriate time; the entry of this order is not a ruling on the merits of plaintiff’s proposed amendment,” Messano wrote. As part of the Act, Murphy was mandated to establish compensation boards in every county where businesses and individuals impacted by the shutdowns, could petition for “reasonable compensation,” in return for his control over their properties. Murphy failed to establish these boards, which would have permitted Pallay to seek relief for her business. Instead Pallay’s thriving decade-old business, according to the filings from her attorneys, Robert W. Ferguson, Esq. of the of the law firm of Stern, Kilcullen and Rufolo, LLC of Florham Park and Catherine M. Brown, Esq., of Denville – a suit facilitated by the non-profit advocacy group Rescue New Jersey - dwindled to the point she closed her doors. “While Rescue New Jersey is pleased that the Appellate Court will address the underlying issue of the State’s misapplication of the Disaster Control Act and economic hardship that Mrs. Pallay has suffered, we wish the Court could have expedited the matter,” said Donald Dinsmore, Esq., Rescue New Jersey’s chairman.

Court briefs show Pallay acted in her business as “a law-abiding, taxpaying citizen of this State,” who not only helped to support her family – including three young children – with her business, she was also a vital part of her region, receiving Congressional recognition for “COVID-related activities that benefitted her community.” Pallay’s business, according to one of the court briefs, accrued debt as a result of her inability to operate under the restrictions, including to her commercial landlord. For more information about Rescue New Jersey and this case, go to: www.rescuenewjersey.org.

Sussex County Adopts Ordinance Expected to Create $2.3 Million in Savings for County Taxpayers

Jennifer Jean Miller
862-273-5379
jenniferjeanmiller@gmail.com

(Newton, NJ) In a time when many New Jersey residents have felt crushed by the weight of overburdening Murphy Administration taxes, Sussex County’s Board of Chosen Freeholders have provided relief to county taxpayers through Refunding Bonds, expected to garner more than $2.3 million in tax savings. The measure for the Refunding Bonds was unanimously adopted at the Wednesday Freeholder meeting, to replace inherited debt in Lease Revenue Bonds as part of the “Guaranteed Renewable Energy Program,” approved by the 2011 Freeholder Board, none of the present freeholders having served on that board. Those $26,715,000 in Lease Revenue Bonds backed a solar energy program that went belly-up after the company folded, leaving Sussex County residents holding the bag. According to the ordinance, $11,070,000 remains outstanding from the 2011 bonds, which will be refunded and refinanced, “to achieve debt service savings and tax relief.”

After Freeholder Director Sylvia Petillo read the ordinance into the record, Bond Attorney John Cantalupo provided background about the initial bonds; and expected savings through the Refunding Bonds. “This was the original solar program, that I know you are all aware of, is those bonds were originally financed,” Cantalupo said. “And as you know, we are in an historically-low interest rate environment.”

He compared the bond refinancing process as a way to lower payments, much like a home mortgage, further recapping the Freeholders approved a resolution on Oct. 15, directing the Morris County Improvement Authority, the issuer of the bonds – with Sussex County not having its own Improvement Authority – to activate the process. Once underway, it triggered the working groups within the Improvement Authority and county, to start reviewing the underlying documents and refinancing process.

Cantalupo said when analyzed, it was discovered the 2011 ordinance never included a refinancing mechanism. In order to create that component within the original ordinance, Cantalupo said the 2011 document required amending, “to allow the bonds to be refinanced.” “You’re not increasing your debt, you’re going to be lowering your debt,” Cantalupo reiterated. He explained more about this savings opportunity for Sussex County residents, saying that to refinance debt in New Jersey, a 3% debt services savings must already exist. “In this instance, what’s currently on the table based on market from the Monday before when it was looked at [Nov. 30], the savings are over 10%,” Cantalupo said, because the county has already paid a shortfall.

He said that equates to $1.15 million saved, which, “goes directly to the county and the taxpayers, under that program.” However, he said taxpayers will actually save $2,309,000, calling it a “fairly significant opportunity” for Freeholders to approve taxpayer relief and debt services. Freeholder Deputy Director Dawn Fantasia thanked Cantalupo for his presentation and for the consistent communications with his office on the topic, stating, “As you know, the current Freeholder Board came in and inherited some of these decisions, and some of this debt, and all of our residents have had to carry this burden.”

“The fact that we are able to save over $2 million, by amending this, is definitely excellent news for us as a board and us as a county,” Fantasia added. In other business: Each of the Freeholders offered their condolences for those who knew Hamburg Police Patrolman Jason Franco, who died accidently on Tuesday while deer hunting. At the start of the meeting, Petillo led the group in a moment of silence in his memory.

“Patrolman Franco was sworn into the Hamburg Police Department on April 16, 2018,” Petillo stated before their moment of silence. “He also served as a volunteer firefighter in Montague. The passing of Patrolman Jason Franco is a terrible tragedy for his family and our entire county. Tonight, our thoughts and our prayers are with his family.” “I want to echo the statements made at the beginning of the meeting and offer my prayers and deepest sympathy to the family of Patrolman Jason Franco,” said Freeholder Anthony Fasano.

“That is just an incredibly sad situation and my heart goes out to his family and to his friends, during this difficult time.” Page 4 December 11, 2020 Freeholder Joshua Hertzberg offered similar sentiments about Franco, saying, “When I first heard what had happened yesterday evening, I couldn’t help but feel that sense of just a terrible feeling what his family must be going through right now. I just want to extend my thoughts and prayers to them and his colleagues. I know he’ll be greatly missed - I’ve heard nothing but good things about him.”

“My heart goes out to Jason Franco’s family,” said Freeholder Herbert Yardley. “It’s a tragedy and there’s not much you can say other than God bless him and his family; and my heart goes out to them.” “In speaking to the tragic loss of Jason Franco, not only was he a police officer, but he was a firefighter,” Fantasia said. “He’s a true gentleman that exemplified public service here in the county and he was loved by so many. Our prayers go to him and his family.” Fantasia recapped figures in the county’s battle against COVID-19, reporting from Dec. 9, 66,415 of the 140,000 residents “have received and reported a test for COVID-19.” Fantasia broke that down, explaining over 47% of the county’s residents have been tested, with only 3,618 or 5.45% positive. Of those cases, 2,481 or 68.6% “recovered.” She defined “recovered” as one “not currently hospitalized with COVID, nor have they passed from COVID.”

She clarified the recovery rate is in process, due to the number of cases still under investigation; and is anticipated to be much higher. There were 937 or close to 26% still under investigation, she added. With the 200 or 5.5% death rate overall – one in October and two in November - the majority occurred at nursing homes, with 115 of the 200 county’s total, or 57.5%. Hospitalizations, updated each Friday on the county’s website, tallied 14 in October, 19 in November and seven to date in December – with all of December’s at Newton Medical Center.

During COVID’s first wave, Fantasia explained, it mainly impacted older adults and those with underlying health conditions, as well as long term care facilities ill-prepared for the pandemic, while mandated by the Murphy Administration to admit and readmit COVID positive to those facilities. The second wave, she said, is considered “community-wide,” with 70% sourced to young and asymptomatic individuals, typically contracting it at congregate activities based events; and passing it to household members between the ages of 19 and 49.

The state is presently not recommending non-essential travel out-of-state, she added, with those visiting from neighboring states asked to quarantine for 14 days. Fasano reminded they can request free tests from the county’s website through LabCorp at: www.sussex.nj.us. Fantasia said residents ordering kits should not enter credit card information, but insurance information; and those whose insurance does not cover it, should check off they do not have insurance, to receive it at no cost.

The county has been working with New Jersey’s Department of Health to develop a COVID-19 vaccine program, Fasano said, and will provide information in the near future about the public health clinics, similar to county flu clinics, for “fair access for all who live, work or are educated in Sussex County.” He called it a “big step in defeating this virus and getting back to normal,” with more information forthcoming on the county’s website. Yardley reminded county veterans in need of food, clothing, household items or toiletries, as well as help with temporary housing and heating bills, can find assistance in Franklin at the veterans’ center, through Catholic Charities; and via the county’s Senior Services. Page 6 December 11, 2020 Petillo thanked the Mohawk House for meal donations to Hopatcong seniors, with the establishment making a similar offer for Franklin seniors, Fantasia said. Hertzberg, who will be leaving the Freeholder Board for the Sparta Township Council in January, complimented the efforts of county employees including Administrator Greg Poff and CFO Elke Yetter, for their debt reduction efforts, as well as Tom Drabic, for public transportation planning programs.

He called it an “unbelievable honor,” to have served the county and to have worked with the other Freeholders, during his tenure. For the full meeting audio, visit: www.youtube.com/watch?v=MrEzzrlAiaY.

Annual “Stuff the Bus” Campaign Collects Close to 60K Pounds of Food for Residents in Need

CONTACT: Jennifer Jean Miller | 862-273-5379
jenniferjeanmiller@gmail.com

(Newton, NJ) Although 2020 has brought unusual circumstances to Sussex County, the generosity of residents remained strong, with more than 58,000 pounds of food items and over $15,000 in monetary donations given, during “Stuff the Bus” food and donation drive events countywide, the weekend before Thanksgiving. The food and fiscal donations collected at each Stuff the Bus site, benefit the Sussex County Social Services food pantry.

"Sussex County's annual ‘Stuff the Bus’ food drive was an outstanding success,” said Freeholder Anthony Fasano. “This program is so important, especially this year, when it comes to helping those who need it most.” “Due to these uncertain times, the need for food was greater this year than in the past,” said Joan M. Bruseo, director of Sussex County’s Division of Social Services. “A big thank you to the generous residents of Sussex County for making the 13th year of ‘Stuff the Bus’ the most successful yet.”

Stuff The Bus Collection - Thanksgiving, Nov. 2020

The generosity in our communities was amazing to witness and it will go a long way in helping county residents this holiday season and beyond," said Fasano, who also assisted at one of the events. According to county figures, more than one million pounds of food and $96,000 in monetary donations, have been collected since the first Stuff the Bus collection in 2008.

Social Services’ pantry not only provides food to those in need from its shelves in Newton for all county residents, it helps to restock shelves at food pantries throughout Sussex County, especially depleted quickly during economically challenging times.

Division of Social Services Director Joan Bruseo with Steve Andrews of 102.3 WSUS

The Stuff the Bus initiative has grown in the past 13 years, typically encompassing the efforts of schools within the county during the “Champions for Charity” food drives but postponed this round due to COVID-19. Participants for this drive included radio stations WNNJ 103.7, WSUS 102.3 and MAX 106.3; supermarkets including ShopRites of Byram, Franklin, Newton and Sparta; “Cram the Cruiser” collections from police departments throughout the county; and businesses that this year included First Hope Bank, Franklin Mutual Insurance Company, Franklin Sussex Auto Mall and R. Poust Inc.

The County of Sussex and Division of Social Services would like to send a warm thank you to the following for their assistance for this year’s Stuff the Bus and Cram the Cruiser events: Borasio; Steve Andrews; Steve Allen; WNNJ 103.7; WSUS 102.3; MAX 106.3; ShopRite; First Hope Bank; Police Chiefs and Officers from Byram, Franklin, Hamburg, Hardyston, Hopatcong, Newton, Sparta and Vernon Police Departments; Franklin Sussex Auto Mall; Skylands Ride; food pantry volunteers; Social Service employees and countless community supporters; as well as the people and businesses who served as a collection site and/or donated to make this food drive such a success.

Shelf-stable food and monetary donations for the food pantry are welcome year-round. Frozen food donations are accepted, such as ham or turkeys, but donors should call in advance to ensure freezer space is available.

Pet donations are additionally accepted at the pantry. For monetary donations, which directly benefit the residents of Sussex County, checks may be made payable to: “Sussex County Division of Social Services.” Individuals or families in need of food may come to the Division of Social Services, located at 83 Spring Street in Newton, Monday through Friday from 8:30 a.m. to 4:30 p.m.

Donations are also accepted during these hours or special arrangements can be made for after-hours donations by calling 973-383-3600.

Judge Transfers Case Against Gov. Phil Murphy to the Appellate Division

Jennifer Jean Miller
Email: jenniferjeanmiller@gmail.com | Tel: 862-273-5379

Court Transfers Case Against Governor to Appellate Division

(Morris Plains, NJ) A Sussex County business owner’s case against Gov. Phil Murphy for his violations of the Disaster Control Act advanced on Friday, after a judge in the Superior Court Morris/Sussex Vicinage granted its transfer to New Jersey’s Appellate Division.

Judge Stuart A. Minkowitz granted in part the Motion for Reconsideration that attorneys filed on Oct. 2 on behalf of Darlene Pallay who owns JWC Fitness LLC., a business in Sussex County’s Franklin Borough, which does business as CKO Kickboxing Franklin. Minkowitz also vacated his previous order from Sept. 30, in which he dismissed the case from the Morris County Law Division, justifying it could only be refiled as a new complaint within the Appellate Division of the Superior Court.

Attorneys for Murphy with the Attorney General’s Office Assistant Attorney General Kevin R. Jesperson and Deputy Attorney General Amy E. Stevens, filed a motion on Oct. 15 opposing Pallay’s Motion for Reconsideration filed by her attorneys Robert W. Ferguson, Esq., of the law firm of Stern, Kilcullen and Rufolo, LLC of Florham Park and Catherine M. Brown, Esq., of Denville.

Minkowitz based his decision, according to the order, on Court Rule 1:13-4, as well as the case Neptune v. State, Dept. of Envir., that when a case ought to be in the Appellate Division initially, it should be transferred for reason, not dismissed.

Ferguson and Brown filed the initial complaint against Murphy for Pallay on Sept. 23, facilitated by the newly formed, not-for-profit and non-partisan advocacy group, Rescue New Jersey. The suit seeks a declaratory judgment against Murphy, requesting Murphy to establish Emergency Compensation Boards as part of the Disaster Control Act, something he has failed to do.

“We are pleased by the court’s ruling and look forward to vindicating our client’s rights in the Appellate Division,” Ferguson said.

“Rescue New Jersey is pleased with the Judge’s decision and looks forward to putting forth a brief to the Appellate Court, where Mrs. Pallay can hopefully get the justice she so desperately needs and deserves,” said Rescue New Jersey’s Chairman, Donald Dinsmore.

“I am very pleased and hopeful at this latest development and I am remaining hopeful that we will be victorious at each step to help my business, as well as all businesses in New Jersey,” Pallay said.

When Murphy invoked the Act in March, ordering businesses like Pallay’s that he deemed were “nonessential” to close, as required by the Act, Murphy was mandated to establish Emergency Compensation Boards in each of New Jersey’s 21 counties, during the prolonged COVID-19 state of emergency – a state of emergency Murphy recently extended for the eighth time.

According to the Act, individuals or businesses are entitled to petition their respective county Compensation Board for reasonable compensation, in exchange for the Governor taking, using or controlling their property, even temporarily, during the state of emergency. In a state of emergency, Ferguson said the statute gives the Governor one power with respect to private property, and that he can only do so subject to compensation.

Pallay’s business has struggled under the strict restrictions Murphy has imposed. While she has family who live in Long Island and North Carolina where fitness businesses have been permitted to operate at full capacity, Murphy has only allowed businesses like Pallay’s to reopen with an indoor maximum state occupancy level of 25 percent. With Pallay’s classes high-intensity, interval training sessions, her class size is capped at 10 students per class, with 200 square feet required between each student.

Prior to the shutdown, Pallay’s classes could fill with up to approximately 30 students. Under Murphy’s edicts, she said she could not fulfill the CKO franchise business model, which offered unlimited classes to all of her members. Additionally, her membership thinned from more than 200 loyal members to 20.

At her most recent classes, Pallay would often average between five to eight students per class. She unfortunately had no choice but to close her doors and hold her final class on Oct. 30.

A reply brief and affidavit submitted to Minkowitz on Oct. 22 from Ferguson and Brown, detailed Pallay’s plight, calling her a “law-abiding, taxpaying citizen of this State,” who helped to support her family over the last decade with her business, including her three young children.

“She complied fully with the Governor’s Executive Orders, nothwithstanding the personal economic cost to her and her family,” the brief read. “She won Congressional recognition for COVID-related activities that benefitted her community.”

“Mrs. Pallay’s circumstances are parlous, dynamic and worsening,” the brief further stated, emphasizing in addition to facing an eviction proceeding from her commercial landlord, “she has creditors and she has expenses she cannot afford to pay.”

For more information about Rescue New Jersey, go to: www.rescuenewjersey.org