The State Supreme Court's Appellate Division has dismissed Nassau County Democratic Committee chairman Jay Jacobs' $45 million libel lawsuit against Southampton Town residents who protested his plan to open a children's day camp.

In 2012, Jacobs, then the state Democratic Committee chairman, sued two leaders of a civic organization in North Sea. He said they distributed fliers accusing him of lying about his proposal on paperwork filed with Southampton Town.

John Barona, the president of the Little Fresh Pond Association, and John Gorman, the vice president, said Jacobs' suit was intended to intimidate them and stifle public debate.

On June 25, a four-member panel of appellate judges upheld a 2012 ruling dismissing Jacobs' claim.

The judges said Jacobs must pay attorney fees to Barona and Gorman which their attorney said amounted to $42,000 -- but said "the defendants failed to demonstrate that this lawsuit was commenced solely to harass, intimidate, punish or otherwise maliciously inhibit their rights to free speech."

The court did not impose punitive damages Barona and Gorman had requested in a counterclaim.

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"Justice has been served," Barona said. "I think he filed the lawsuit as a way of trying to stop public participation against his camp, because there were very many people against it."

Jacobs said his claim is legitimate, and he is considering appealing to the state's highest court. "These folks, in an attempt to stop a legitimate project in Southampton, made libelous statements about me, and disseminated them on the windshields of cars up and down roads in Southampton," he said.

Jacobs' camp proposal has embroiled him in several court battles in the sleepy community of North Sea, where residents have complained the influx of children will generate traffic and noise, and could disturb the environment of Little Fresh Pond.

In 2012, Southampton Town's zoning board of appeals ruled that Jacobs must seek a variance for his original proposal for a day camp on the 17-acre site. He bought the former tennis club property in 2010. Jacobs said he has operated a tennis club and camp there since last summer without a variance, under an existing certificate of occupancy.

Barona and two other residents sued Jacobs last year, claiming the camp violates the zoning board of appeals decision. That suit is pending in State Supreme Court.

Jacobs won a separate court battle last year against residents who sought to stop him from installing a pool on the site. He said his certificate of occupancy "allows exactly what I am using it for today, nothing more and nothing less."He said children who participate in the camp for 10 weeks in the summer play tennis and "cross-train" with other activities, such as basketball and swimming, and do not swim in the pond.

"I am not running a nuclear waste dump, which is what they made the place sound like," added Jacobs, who owns four day camps and three sleepaway camps in New York and Pennsylvania.