A trucking and logistics company that won a $79 million tax break from New Jersey left out information on its tax credit application about several criminal and civil legal cases, according to a letter the Teamsters International Union sent to the Economic Development Authority and the Attorney General’s Office.
NFI, which applied for the tax breaks in 2016 and ultimately moved into a Camden waterfront office tower, certified in its application for Grow New Jersey tax breaks that it was not found guilty of any criminal violations nor was it involved in any legal proceedings, both of which the Teamsters letter argues were outright false.
In a statement to NJBIZ, NFI disputed the letter, saying the company has fully complied with Grow NJ application requirements.
“We have reviewed the letter sent by the Teamsters Union … and, as is typical of the Teamsters’ tactics, it is littered with inaccuracies and misinformation,” NFI said.
But in 2005, NFI affiliate Interactive Logistics Inc. pleaded guilty in federal court to three counts of wire fraud and was ordered to pay an $805,000 fine, and then $225,000 of restitution to beer-maker Anheuser-Busch, which the logistics company allegedly defrauded, according to the Teamsters letter.
Interactive Logistics was doing business as NFI Interactive Logistics LLC, even though NFI denied that they were affiliated.
“NFI’s criminally false statements warrant prosecution, and those statements, along with the company’s history of violating workers’ rights should also bar it from receiving financial assistance from the [Economic Development Authority],” Teamsters Vice President Fred Potter wrote.
In addition, the letter states: “NFI should be prosecuted and barred from receiving any financial assistance from the state.”
Regarding the 2005 case, NFI responded that, “the entity involved in that legal proceeding was dissolved in 2011 and, as a result, is not an affiliate of NFI. In an effort to resolve the ongoing litigation, that entity chose to take full responsibility for the unauthorized actions of one of its employees.”
In another case, when NFI submitted its application in 2016 it said there were no ongoing legal proceedings against the company, even though it was the subject of several labor wage law disputes, some of which were not settled until 2018, the Teamsters letter states.
Responding to that litigation, NFI said its Grow NJ application includes a Supplement to the Additional Background Questions, in which it details the existing litigation against the company.
“As part of its application diligence process, the EDA requested additional information about certain litigation, which we promptly provided,” NFI said.
A task force which Gov. Phil Murphy put together to scrutinize Grow NJ, which expires on July 1, presented evidence in May that NFI, along with several other businesses being advised by a law firm owned by the brother of South Jersey powerbroker George Norcross, presented falsified and questionable data on their applications about plans to move out of state in order to win tax breaks.
NFI and the other two companies – The Michaels Organization and insurance firm Conner Strong & Buckelew, where Norcross is a partner – ended up moving to a newly built waterfront office tower in Camden.
The EDA and Grewal’s office could not be reached for comment, while the governor’s office did not immediately return a request for comment.
“NFI’s willful misstatements about its criminal history, and about litigation challenging its fairness as an employer, compel the conclusion not only that NFI is an unworthy recipient of public funds, but that it is a criminal actor defrauding the state,” Potter wrote.
NFI’s legal counsel, William Tambussi of Brown & Connery LLP, did not return a request for comment.
Kevin Sheehan, a lawyer for Parker McCay where George’s brother Philip Norcross is a partner, provided advice to NFI, The Michaels Organization and Conner Strong in order to win the tax breaks.
Those three companies, according to documents presented at the task force hearing, provided questionable data about where in Philadelphia they would move if they did not receive the tax breaks.
All three initially stated that they would not leave the state without the tax breaks, only to change that response shortly before submitting their application, according to the task force.
NFI’s lawyer, Tambussi, is also the lawyer for George Norcross and those three companies who have filed several legal challenges against the task force.
Other companies highlighted in the task force investigation, all tied to Norcross, have filed some kind of legal challenge against the task force or Murphy administration, include Parker McCay and Cooper University Health Care, where George sits on the board of directors.
The high-profile legal team was successful in pressuring the task force to delay the release of its findings by at least a week until a June 17 court hearing—they were initially scheduled to be made public on June 11.
Murphy wants to let Grow NJ expire and replace it with a set of five new incentives capped at $400 million a year. He has threatened to veto a measure traveling through the state Legislature which would extend Grow NJ for seven months to buy more time for Murphy and lawmakers to hash out a new set of incentives.
But Senate President Stephen Sweeney, D-3rd District, a supporter of Grow NJ and Murphy’s often-timed political opponent, has dangled the possibility of a veto override for doing that.
