(Covers information from the S.D. Perry novels)
Shortly after the Mansion Incident, Barry called Jay, along with Trapp, for support when he and the other surviving Raccoon City S.T.A.R.S. were targeted with discrimination and false crimes by the Umbrella Corporation. Jay was worried about Barry and his comrades, and said he would keep and eye on Umbrella's activities. For another couple of minutes, Barry and Jay had a nice conversation, catching up, telling old stories and Barry said he would send him pictures of his kids. It was here Jay had to get off the phone, explaining that he wanted to talk but he had a meeting.
As it turned out, Jay had been "got to" by Umbrella (who's representatives presumably met Jay after the call) and, through either bribery or blackmail, forced him to work for them. This was repeated with other S.T.A.R.S. personnel, most especially Assistant Director Tom Kurtz, in key leadership positions, and others either discredited or forcibly retired (such as the National Commander; Marco Palmieri).
A week later, Jay and other S.T.A.R.S. officers subverted by Umbrella were sent to Raccoon City to eliminate the surviving Raccoon S.T.A.R.S. while they were meeting at Barry's house. The team proceeded to launch an assault on Barry's residence.
Jay wasn't seen, only identified as a shadow, and Jay proceeded to shoot two bullets at them near the conclusion of the battle, one of which hit Barry in the arm. In turn, Trapp (who was present at the meeting), who didn't get a good look at Jay as it was too dark, in turn shot Jay with a single semi-jacketed round. The shot was lucky, as it punched a hole directly over Jay's heart. His blood splattering over his gun, Jay stumbled and collapsed on his back, crashing against a tree before collapsing silently into the dirt, dead.
Trapp identified Jay after mere seconds later, and suffered greatly for killing his friend. Barry, however, was initially unable to accept what Shannon had done, though in the end did, though constantly wondered what could have made him betray the S.T.A.R.S.