After Alina Habba’s ouster, Newark’s lead pipe fraud case is in limbo

A lawyer sought the dismissal of the charges based on the claim that Habba was not legally the U.S. attorney.

A team of criminal investigators headed by the FBI spent the better part of a year digging up residential curbs, sidewalks, and yards across Newark to determine whether lead water pipes had actually been replaced as they were supposed to be by a private contractor.

From January to September 2024, they excavated more than 400 holes in search of evidence in what prosecutors described as a shameless and systematic fraud that threatened the health of people throughout the city.

Federal prosecutors said the contractor for the project simply left dozens of the old lead lines in place and submitted fake paperwork and photos claiming he had done the work.

In October 2024, police arrested Michael Sawyer, CEO of JAS Group Enterprise Inc., which collected $10 million in taxpayer money to replace the hazardous lead pipes. Sawyer, a 57-year-old Burlington County resident and developer, has also won state tax breaks to build affordable housing projects in Somers Point, Lawrenceville, and other places.

But more than 15 months after Sawyer and an alleged accomplice were arrested, the prosecution of an environmental fraud case that stunned New Jersey remains in limbo. It is a potential casualty of the turmoil surrounding Alina Habba, Donald Trump’s abortive choice as U.S. attorney for New Jersey.

Habba resigned her post in early December 2025 after a federal appeals judge upheld lower court rulings that Trump had appointed her illegally.

Court documents reviewed by The Jersey Vindicator show that Habba had taken a personal interest in the prosecution of the Newark lead line case, inquiring into details of the replacement project and even raising thorny issues about the handling of evidence by prosecutors.

In a crucial July 22 meeting with Michael Schwartz, the lead attorney for Sawyer, Habba asked questions about the role of CDM Smith, a Boston-based engineering firm that Newark had hired to oversee the project. Part of the company’s job was to inspect the work on-site and determine if it was done correctly, according to the October 2024 criminal complaint that described the alleged scam.

Before getting paid, Sawyer and his company had to submit pay vouchers and work documentation to CDM, which then was charged with signing off on payments and certifying the work before the city cut checks.

The court records are not clear about why Habba specifically asked about the work of CDM Smith. But in the same meeting, Habba also asked about “the lack of a Brady disclosure” by the government. Such a constitutionally mandated disclosure requires prosecutors to provide criminal defendants with any exculpatory evidence in order to ensure a fair trial.

“Habba concluded the meeting by stating that she supported her team, but said there were important issues in the case and she wanted to take a ‘deep dive,'” Schwartz said in court papers, adding that it was his “good faith belief that some of the witnesses interviewed by the government provided exculpatory information” prosecutors had failed to share.

A few days after the July 22 meeting, prosecutors offered to provide redacted copies of witness interviews to the defense, while still maintaining they had properly followed evidentiary rules.

But Schwartz later sought the dismissal of all the charges against his client based on the claim that Habba was not legally seated as U.S. attorney.

U.S. Magistrate Judge Sharon King, sitting in Camden, halted Sawyer’s criminal prosecution and sent the case to U.S. District Judge Matthew Brann in Pennsylvania. Brann was already reviewing similar complaints lodged by three other criminal defendants indicted by Habba in New Jersey, including a pair of alleged drug runners and the mastermind of a multimillion-dollar real estate scheme police uncovered in Bergen County.

Brann promptly ruled against Habba, dealing a major blow to the Trump administration’s plans to evade U.S. Senate oversight by naming acting prosecutors around the country. A federal appellate judge upheld Brann’s ruling against Habba in early December, banning her from any further participation in the New Jersey criminal cases she had directed. Habba subsequently resigned.

The court rulings cast uncertainty on Sawyer’s prosecution in Newark’s lead pipe replacement fiasco. There was no word from the U.S. Attorney’s Office about how the case might proceed, especially since Habba had personally directed the case at a time the court said she did not have the authority.

On Jan. 5, the U.S. Attorney’s Office in Newark, contacted by The Jersey Vindicator, declined to comment on the Sawyer case or confirm if criminal fraud charges would be pursued. A day later, court records show, Assistant U.S. Attorney Edeli Rivera sent a letter to Judge Brann urging him to remit the criminal charges back to New Jersey.

“The Government is considering, in an abundance of caution, whether to seek a new charging instrument” against Sawyer, Rivera wrote.

Schwartz, Sawyer’s attorney, declined to return messages seeking comment for this story.

Sawyer and his co-defendant, Latronia Sanders of Roselle, have been free on $100,000 bail since being arraigned in 2024. They have pleaded not guilty to federal charges of wire fraud connected to the alleged lead pipe scheme.

The pair is also under investigation for allegedly running the same scam in Trenton, where they were hired to replace 1,300 lead and galvanized steel service lines under a $7.9 million contract awarded by the Trenton City Council in 2021.

Michael Walker, a spokesman for the Trenton Water Works, which serves 225,000 customers in the state capital and four surrounding Mercer County communities, said in December 2024 that the city was working with investigators to determine if work assigned to Sawyer’s company had indeed been performed.

Last week, state environmental regulators released an audit that showed investigators are now focused on 19 addresses in the city of Trenton where Sawyer and his workers may have committed fraud by claiming to remove lead drinking water lines that remain in service. The specific addresses have not been released.

The state ordered the City of Trenton to perform excavations at those sites and investigate more than 60 others in the city where documentation certifying the work is missing. The Trenton work was overseen by CDM Smith, the same Boston engineering firm that supervised the Newark project.

The investigations in Newark and Trenton have led the state to re-examine how it oversees lead pipe replacements around New Jersey. A report from the New Jersey Department of Environmental Protection in August itemized “lessons learned” through the alleged scam.

Planned reforms call for “enhanced controls that will include standardized site inspection report fields, guidance for pictures taken by oversight managers, and additional data reporting requirements,” according to the report.

Communities across the state are rushing to comply with a 2031 deadline set by the Murphy administration to replace all lead and galvanized steel water service lines. Many poorer towns, however, have fallen behind.

Trenton, for example, is in the midst of a multiyear project to replace tens of thousands of lead water lines throughout its service area. The project remains less than half complete and millions short of cash, officials say.

Testing by the U.S. Environmental Protection Agency (EPA) showed that both Newark and Trenton had lead levels that were among the highest of any major city in the United States, exceeding 15 parts per billion, the level of lead above which the EPA requires that remedial action be taken.

According to the EPA, any amount of lead exposure—even at levels below the federal actionable standard of 15 parts per billion—is detrimental to people’s health, particularly for children.