Consumer Law

Law firm pays $6M in settlement with bankrupt Newark agency

An ally of New Jersey Sen. Cory Booker and his old law firm have agreed to pay $6 million to settle a lawsuit alleging legal malpractice and widespread negligence perpetuated a multi-million kickback scheme that bankrupted the agency once in charge of treating Newark’s water.

It’s among the most significant developments in the bankruptcy case for the Newark Watershed Conservation and Development Corporation, the independent agency that received taxpayer money to oversee water treatment and delivery to half a million North Jersey residents.

The lawsuit filed by trustees for the agency in federal bankruptcy court, claimed that officials with oversight powers shared financial responsibility for the scandal because their inattention enabled wasteful and illegal spending and failed to stop millions in no-bid contracts for work that was never performed. Booker, who was mayor until 2013 and has since launched a bid for the presidency, was originally named in the complaint but a federal judge dismissed the case against him.

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