Two Passaic Chiefs Claim City Fraudulently Forced Them to Retire

Two Italian American deputy chiefs with the Passaic (NJ) Fire Department who agreed to retire in 2011 rather than accept forced demotions have filed suit claiming they were the victims of fraud and ethnic discrimination.

Deputy Chiefs Michael Martocci and John Scangarello claim the city, through its Business Administrator Ricardo Fernandez, conspired with FMBA Local 216 union president Louis Sanchez, to fraudulently pressure them to retire in an effort to benefit Hispanic firefighters.

The suit was filed in US District Court last Friday against the city of Passaic, the Passaic Fire Department and Fernandez. Martocci and Scangarello allege that the other two deputy chiefs, both of whom are Hispanic, did not retire and were never demoted. Fernandez and Sanchez are Hispanic.

The complaint contains seven counts, including:

  1. Use of fraud to discriminate on the basis of ancestry;
  2. Conspiracy to fraudulently discriminate;
  3. Violations of equal protection, substantive and procedural due process rights  violations by the city and fire department (Section 1983);
  4. Violations of equal protection, substantive and procedural due process rights  violations by Fernandez (Section 1983);
  5. Violation of the NJCRA and the NJ Constitution;
  6. Misrepresentation;
  7. Breach of promise (promissory estoppel).

Neither Sanchez nor FMBA Local 213 were named as defendants in the suit. Here are some of the more important allegations from the complaint.

  • Beginning in or about 2010 and continuing throughout the first half of 2011, Plaintiffs were repeatedly reminded and warned by Fernandez that Defendants would be eliminating the title of Deputy Chief and demoting all individuals with that title to the newly established title of Battalion Chief, resulting in a decrease in Plaintiffs’ base pay.
  • Louis Sanchez, who is also Hispanic and the President of Plaintiffs’ union Local 216, also frequently informed Plaintiffs of the inevitable and imminent demotions of all four (4) Deputy Chiefs under the RIF [reduction in force].
  • Both Fernandez and Sanchez repeatedly cajoled and at time threatened Plaintiffs to retire before they were demoted, informing them that since they had more than twenty-five (25) years of service, if they agreed to retire before the demotions were effectuated they would get the benefit of receiving pension benefits as a percentage of their higher base salary as Deputy Chiefs rather than Battalion Chiefs.
  • In reliance upon these representations, on August 11, 2011 Plaintiffs entered into separate agreements (the “Agreements”) with Passaic wherein they agreed, inter alia: (1) to formally retire no later than February 1, 2012; and (2) to forego any clothing allowance and stipend monies they would have otherwise been eligible to receive on or after December 31, 2011.
  • In return, Passaic agreed that Plaintiffs would not be subject to the pending demotion and would thus be able to retire as Deputy Chiefs.
  • At the time of Plaintiffs’ retirement, there were two other Deputy Chiefs within the PFD, both of whom, like Fernandez and Sanchez, were Hispanic.
  • It was not until sometime after executing the Agreements and formally applying for (and being granted) retirement through the New Jersey Police and Firemen’s Retirement System, that Plaintiffs learned the following: (1) the two Hispanic Deputy Chiefs remained Deputy Chiefs and were assigned to comfortable office jobs; (2) many Hispanic firefighters had been promoted to positions formerly held by the non-Hispanic officers that had been part of the RIF or forced into retirement; and (3) rather than demote the Deputy Chiefs, four (4) Captains (including Sanchez) were promoted to Battalion Chief.
  • Thus, and despite Defendants repeated pronouncements that the RIF was solely predicated on financial reasons, including cutting costs and ensuring reductions in overtime, four (4) Captains were promoted to Battalion Chiefs with a higher rate of pay. Thus, as opposed to the five (5) individuals that held the title of “Chief” before the RIF, the PFD now employed seven (7) Chiefs post-RIF.
  • Upon beginning to learn of the foregoing (but not yet knowing of the total extent of Defendants’ wrongdoing) on or about January 25, 2012, and through legal counsel, Plaintiffs forwarded correspondence to Fernandez, informing him that: (1) they had reasonably relied upon Defendants’ representations that all Deputy Chiefs were being demoted in agreeing to enter into early retirement; (2) there was no reduction in the number of Chiefs in the PFD; (3) Plaintiffs were fraudulently induced into entering into the Agreements; and (4) were also the victims of unlawful discrimination.
  • On or about August 14, 2012, Plaintiffs, through legal counsel, served Defendants with a Tort Claims Notice pursuant to the New Jersey Tort Claims Act, N.J.S.A. 59:8-1, et seq.
  • To date, Plaintiffs have been substantially injured by the actions of Defendants, having lost out on the continued opportunity to serve as Deputy Chiefs and the compensation and benefits that came with the position. …
  • Defendants intentionally and maliciously compelled Plaintiffs to retire under the threat of an imminent demotion of all Deputy Chiefs to Battalion Chiefs.
  • In actuality, Defendants had no intention to demote the Hispanic Deputy Chiefs, and fraudulently compelled Plaintiffs to retire in order to bolster the rank and seniority of the Hispanic Deputy Chiefs.
  • Indeed, upon information and belief, numerous Hispanic firefighters were promoted to various positions once held by non-Hispanic firefighters who were either laid off or forced to retire under the threat of the RIF.
  • Defendants forced Plaintiffs’ retirement in order to promote and bolster the ranking and compensation of similarly situated Hispanic officers. …
  • Defendants’ purported justification for the Deputy Chief demotions and RIF was financial, but the foregoing demonstrates that this reason was purely pretextual….
  • Defendants had no legitimate, non-discriminatory reason for their actions…

Here is a copy of the complaint: Martocci v City of Passaic

About Curt Varone

Curt Varone has over 40 years of fire service experience and 30 as a practicing attorney licensed in both Rhode Island and Maine. His background includes 29 years as a career firefighter in Providence (retiring as a Deputy Assistant Chief), as well as volunteer and paid on call experience. He is the author of two books: Legal Considerations for Fire and Emergency Services, (2006, 2nd ed. 2011, 3rd ed. 2014) and Fire Officer's Legal Handbook (2007), and is a contributing editor for Firehouse Magazine writing the Fire Law column.
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