By Joshua Burd
Morristown will pay $5.5 million to settle a lawsuit with the Silverman Group after the developer alleged the mayor thwarted a deal to bring Deloitte LLP to one of its properties, instead steering the accounting giant to its eventual home at the M Station campus.
The settlement, which was announced last week, came in the midst of a civil trial tied to a downtown site at the corner of South and Pine streets, where Silverman planned to build more than 100,000 square feet of high-end office space above more than a dozen existing storefronts. Deloitte reportedly had settled on the site for its new regional headquarters after months of negotiations, the real estate firm argued, only to see the deal fall through after what it said was interference by Mayor Tim Dougherty and other officials.
In the April 10 announcement, Dougherty reiterated his stance that the six-story building “would have marred the character of South Street.
“It would have fundamentally altered what we all love about South Street,” the mayor said in a prepared statement. “Our insurance company made a business decision based on the ongoing costs of litigation. However, we are proud we stood firm to our beliefs and never agreed to a project that was simply not a good fit for that location. Morristown has experienced enormous success because our development process is thoughtful and measured, always taking the best interests of our community into account. We will continue to fight for smart development and because we stayed strong the character of South Street remains intact today.”
Joseph B. Fiorenzo, an attorney for the Silverman Group, said the firm was “pleased with this result, which was achieved after presenting compelling evidence to the jury over nine days, with eleven witnesses, that Morristown and its highest officials, including its mayor and business administrator, intentionally interfered with Deloitte’s selection of The Silverman Group’s site.”
“It is the height of government overreach for elected officials to inject themselves into negotiations between private parties and dictate the development of an owner’s property behind closed doors,” said Fiorenzo, a member of Sills Cummis & Gross PC and co-chair of its litigation department. “It is unfortunately symptomatic of a culture of disregard of both individual property owners’ rights and the open land use process before public boards.
“In recognition of the overwhelming proofs adduced at trial of its wrongful interference, the defendants have now agreed to pay the sum of $5.5 million to Silverman after taking a ‘no pay’ position and announcing there would be no settlement of the claim at the commencement of the trial. We hope this case will send a message to municipal officials everywhere that there are consequences to unlawfully wielding power to distort a fair process for the benefit of a favored developer.”
Deloitte moved into its new 110,000-square-foot ground-up office building on Morris Street in summer 2022, relocating from Parsippany to the eastern portion of SJP Properties’ high-profile M Station campus. Silverman had filed suit roughly three years earlier, alleging that Deloitte in July 2018 was planning to move forward with the South Street site, but was told by Dougherty told that it would not be able to do so.
Attorneys for Silverman would go on to present correspondence among Dougherty, business administrator Jillian Barrick and other officials that showed a preference for an SJP building. Several of those officials were called to testify in recent weeks as the civil trial took place over several days, giving way to the April 10 settlement announcement.
The $5.5 million settlement was slated to be paid in two installments, with the first coming by this week and the final payment in August.
