New Jersey Supreme Court Limits Private Lawsuits Under Civil Rights Act

Recently, the New Jersey Supreme Court ruled that private claims under the New Jersey Civil Rights Act (NJCRA) are limited to claims against individuals who were acting “under color” of state law. In other words, you can bring a private lawsuit under the NJCRA, but only against someone who was acting in his or her capacity as an employee or agent of the state or local government.

Bitters and infusions on bar counter with blurred bottles in bacThe case was brought by Maryann Cottrell, a resident of Glassboro, New Jersey. Ms. Cottrell apparently made negative comments about Zagami LLC at its public liquor license renewal hearing. Zagami is a company that owns a restaurant and bar in Glassboro. The company subsequently sued Cottrell, claiming her statements at the hearing were defamatory.
Zagami’s lawsuit eventually was dismissed by the Appellate Division. It found that since the liquor license renewal hearing was a “quasi-judicial” proceeding, Ms. Cottrell’s statements at it were protected by absolute immunity, meaning she could not be sued for anything she said at the hearing.

Ms. Cottrell then sued Zagami for malicious use of process, claiming its defamation lawsuit was a Strategic Lawsuit Against Public Participation (also known as a “SLAPP suit”) since it was baseless and intended to retaliate against her for speaking out against Zagami at the hearing and to deter her from doing so again in the future. Ms. Cottrell also brought a claim under the New Jersey Civil Rights Act (NJCRA), a state law that provides remedies for certain violations of the United States and New Jersey Constitution. For more information about the NJCRA, please read our Frequently Asked Questions (FAQ) About the New Jersey Civil Rights Act.

The trial court dismissed Ms. Cottrell’s case, finding there was probable cause for Zagami to bring a defamation claim, meaning there was a good enough basis for the company to file its defamation lawsuit that Ms. Cottrell could not prove that lawsuit was brought maliciously. The lower court also dismissed Ms. Cottrell’s NJCRA claim, ruling you cannot bring a private lawsuit under the NJCRA unless the defendant was acting under color of law.

The Appellate Division reversed on both of those issues. If concluded there was no probable cause for Zagami’s defamation lawsuit, and therefore Ms. Cottrell could proceed with her malicious abuse of process claim. It also ruled that the NJCRA does permit private claims against individuals who were not acting under color of law, as long as the lawsuit alleges the plaintiff was deprived of one of his or her protected rights, in this case the right to free speech.

However, last week in Cottrell v. Zagami, LLC and a companion case, Perez v. Zagami, LLC, the New Jersey Supreme Court reversed the Appellate Division’s ruling with respect to Ms. Cottrell’s NJCRA claim. It held the NJCRA creates a private cause of action only against individuals who are acting under color of law. Accordingly, since Zagami is a private company and not a government agency, it cannot be sued under the NJCRA.

The Supreme Court noted that Ms. Cottrell still has a remedy for Zagami’s effort to deter her from publically speaking about matters of public interest at a municipal hearing. Specifically, she still can continue to pursue her malicious use of process claim.