Third Party Liability Under New Jersey Law Against Discrimination
New Jersey state courts have not specifically addressed the subject of third party liability under the LAD's (New Jersey Law Against Discrimination) aiding and abetting provision.
The Third Circuit and the United States District Court for the District of New Jersey, however, set forth an instructive standard in Failla v. City of Passaic, 146 F.3d 149 (3d Cir.1998), and Hurley v. Atlantic City Police Department, 174 F.3d 95 (3d Cir.1999), cert. denied, 528 U.S. 1074, 120 S.Ct. 786, 145 L.Ed.2d 663 (2000).
In Failla, 146 F.3d at 158, the Third Circuit, upon examination of Tyson v. CIGNA Corp., 918 F. Supp. 836 (D.N.J.1996), aff'd, 149 F.3d 1165 (3d Cir.1998), Passaic Daily News v. Blair, 63 N.J. 474, 308 A.2d 649 (1973), and Baliko v. Stecker, 275 N.J.Super. 182, 645 A.2d 1218 (App.Div.1994), appeal after remand, 322 N.J.Super. 261, 730 A.2d 895, certif. denied, 162 N.J. 199, 743 A.2d 851 (1999), predicted that the New Jersey Supreme Court would incorporate Restatement (Second) of Torts 876(b) into N.J.S.A. 10:5-12(e) and find that a person is liable for harm resulting to a third person from the conduct of another when "one knows the other's conduct constitutes a breach of duty and gives substantial assistance or encouragement to that conduct."
Relying upon Dici v. Pennsylvania, 91 F.3d 542, 553 (3d Cir.1996), the Failla court denied summary judgment to a supervisor on plaintiff's claim under 12(e) of the LAD. Id. n. 11.
The court further predicted that inaction could form the basis of aiding and abetting liability if it rose to the level of "providing substantial assistance or encouragement." Id. at 158.
court stated that plaintiff's supervisor could be liable for aider and abettor liability only if he knew that the failure to accommodate plaintiff was a breach of his employer's duty and if his inaction actually assisted or encouraged the unlawful act. Ibid.
The Failla court, however, refused to impose liability merely because a third party had some knowledge of the alleged illegal activity. Id. at 159.
Instead, the court noted that the extent of knowledge required for 12(e) liability is heightened by the Restatement standard. Ibid.
"Only those parties who meet this heightened standard will be aiders and abettors." Ibid.