ELIZABETH -- The gun charge against former Rutgers football star and NFL player Khaseem Greene stemming from a shooting outside an Elizabeth nightclub in December has been dismissed after it was revealed the accused gunman admitted he lied about Greene's involvement.

Greene, 28, of Elizabeth, was charged with unlawful possession of handgun after authorities said he handed a gun to the alleged shooter, Jason Sanders, outside the Allstar Night Club on Third Street in Elizabeth on Dec. 3.

Authorities said Sanders fired the handgun into the crowd, but no one was injured, and that security footage showed Greene passing Sanders the gun.

Court records show Sanders gave a voluntary statement when he was arrested on Dec. 30. He admitted to the shooting and said Greene had handed him the gun, authorities said. Greene was subsequently charged on Jan. 4 and indicted on May 9.

In several court appearances, Greene's lawyer, Joshua McMahon of Schiller McMahon in Westfield, sparred with state Superior Court Judge Robert Kirsch while alleging "misconduct" in how the Union County Prosecutor's Office and Elizabeth Police Department handled the case.

The prosecutor's office requested the charge be dropped and Kirsch dismissed it without prejudice on July 17, court records show.

McMahon now says the misconduct he was referring to is that Sanders recanted what he said about Greene the same day court records say he implicated him.

In an audio recording of Sanders' Dec. 30 interview provided by McMahon, Sanders told Elizabeth detectives he lied about Greene's involvement when pressed about whether he made that part up.

Sanders says, "If you put it like that, sir, then I lied."

"Okay, well you can recant at another time. Not tonight," one of the detectives responds. "When the prosecutor's office talks to you about your case you can say that wasn't Khaseem, I don't know what I was doing, but tonight this is an official statement. So you have every right as someone who is being charged with a crime to recant any part or all of your statement after your initial statement. Okay?"

McMahon said the conversation is proof that the prosecutor's office proceeded with indicting Greene despite Sanders admitting he lied.

A spokesman for the prosecutor's office said he could not comment on specific pieces of evidence while the case against Sanders remains pending.

Through a spokesperson, Elizabeth Mayor Chris Bollwage and Elizabeth police department leaders declined to comment on the dismissal.

"The Prosecutor's Office and police department worked in concert to repeatedly perpetrate at least two lies to the judge who they sought the initial arrest warrant from, and the grand jurors who returned the indictment," McMahon said.

"Specifically, police and prosecutors, despite overwhelming evidence to the contrary, falsely stated Greene was visible on a surveillance video recording handing a gun to another man, who then fired the gun into a crowd; and, second, that the alleged shooter, Jason Sanders, a self-admitted liar and multi-convicted felon, gave a statement to police claiming Greene handed Sanders the gun."

According to court records, Sanders has been previously convicted of a slew of weapons charges in several incidents going back to the 90s, plus a robbery conviction in 1991 and a conviction for making terroristic threats in 1993. In 1998, he was sentenced to eight years in state prison on one of the weapons charges and was released in 2003.

The fact that Sanders recanted about Greene's involvement was never noted in any police report nor was it told to the grand jury, McMahon said.

Prosecutors also did not play the surveillance video for the grand jury, he said. McMahon said he believes prosecutors wanted Greene to admit to a crime he did not commit "in order to shield the office from civil liability."

McMahon said the charge has cost Greene his NFL career and that he intends to bring a civil rights action in federal court "to help the young man get back on his feet financially and, just as important to Khaseem, take steps to make sure that police and prosecutors who tragically rush to accuse innocent black men are held to account."

Rutgers Scarlet Knights linebacker Khaseem Greene (20) celebrates after recovering a fumble for a touchdown in the Russell Athletic Bowl at the Florida Citrus Bowl on Friday, December 28, 2012 in Orlando, Fla. (David Manning for the Star Ledger)

Greene, who played football for Elizabeth High School, spent five years at Rutgers, where he played two years at safety and two years at linebacker. He was also a two-time Big East Defensive Player of the Year (2011-12), and he co-captained the Rutgers team that won a share of the 2012 Big East title. He graduated from Rutgers as the most decorated defensive player in school history.

The Chicago Bears drafted Greene in the fourth round of the 2013 NFL draft. He played 25 games over two seasons but then was cut by the Bears.

Though he has not taken the field since, he was on the rosters of the Tampa Bay Buccaneers and Detroit Lions, and was signed in January to a futures contract by the Kansas City Chiefs, allowing him an off-season opportunity to compete for a roster spot in summer training camp.

The Chiefs, however, placed Greene on waivers on May 10 just hours after NJ Advance Media reported that he was indicted on the gun charge.

The Chiefs declined to comment about whether the dismissal of charges would change Greene's status with the team.

Former Elizabeth High football coach Chet Parlavecchio told NJ Advance Media he was "flabbergasted" when he heard of Greene's indictment.

"He's one of the greatest kids I've ever coached," Parlevecchio said previously. "He was a leader and everything you wish for in a football player. He was someone who was never in trouble in high school. When he was there, he was a gentleman for us. Never any trouble."

"Khaseem is a total class act who has never been in trouble, and when he is not playing ball, he is spending his time and money hosting free football camps and clinics for underprivileged kids in his hometown of Elizabeth," McMahon added. "My heart goes out to Khaseem over the toll this has taken on his career."

Sanders faces charges of illegal possession of a handgun as well as possession of a weapon for an unlawful purpose and second- and third-degree aggravated assault. He is being held on $100,000 bail.

Tom Haydon and Ryan Dunleavy contributed reporting to this story.

Jessica Remo may be reached at jremo@njadvancemedia.com. Follow her on Twitter @JessicaRemoNJ. Find NJ.com on Facebook.