MULTINATIONAL MONITOR Jan/Feb 1991 VOLUME 12, NUMBERS 1 & 2, JANUARY/FEBRUARY 1991
Busting the Trash Trust
THE NATION’S TWO largest garbage hauling companies, Waste Management, Inc. (WMI) and Browning-Ferris
Industries, Inc. (BFI), recently paid $50 million to settle a lawsuit in which they were accused of conspiring to fix prices across the
United States. Cumberland Farms and six other companies filed the suit more than three years ago in a Pennsylvania federal
district court on behalf of the two waste haulers’ approximately 500,000 customers nationwide. It is the first case to accuse the
two multinational trash disposal corporations of anti-trust violations on a national scale, although both have a history of convictions
and fines for regional price-fixing and other illegal activities [see “BFI: The Sludge of the Waste Industry,” Multinational Monitor,
June 1990]. This is the “first time the garbage industry’s overall pattern of racketeering has been pieced together,” Jonathan
Hutson of Citizen Action, a national public interest group, told Multinational Monitor. The companies, however, dismiss the
plaintiffs’ claims of a nationwide conspiracy, and “vigorously deny” that the agreement is an admission of any wrongdoing. The
settlement followed the failure of the defendants’ motion for dismissal of the case. When the court ruled that there was sufficient
evidence for the trial to proceed, the corporations agreed to the $50 million payment “to avoid the expenses and uncertainty” of a
trial, says Browning-Ferris. Waste Management Vice President J. Steven Bergerson adds that the settlement was reached “to
protect the company against suits arising from old investigations.” Waste industry observers such as Brian Lipsett of the Citizen’s
Clearinghouse for Hazardous Wastes see the payment as a validation of the plaintiffs’ accusations. “It’s clear to me that they
settled to avoid a finding of guilt, because the evidence was so strong,” Lipsett says. Critics argue that the companies settled to
prevent public disclosure of their criminal activities. The settlement will effectively bury the numerous documents and depositions
introduced by plaintiffs in the class-action lawsuit. “These [plaintiffs’] documents may never be seen by the public,” says Hutson.
“This settlement shows just how far the companies will go to keep the lid on the seamy side of the business.” Hutson points to the
companies’ repeated convictions and fines as evidence of the necessity of laws barring lawbreaking corporations from receiving
government contracts [see “Crime Doesn’t Pay,” Multinational Monitor, May 1990]. “This [settlement] gives citizens’ groups
energy to press for ‘bad boy’ laws nationwide,” says Hutson. “Ultimately that will be the most effective deterrent to corporate
crime.” -Nadav Savio
The 10 Worst Corporations of 1989
WASTE MANAGEMENT:
Criminal Recidivist Waste Management Inc., (WMI) the largest waste dumper
in the U.S., is also a repeat offender. Last year, its criminal record
became so offensive that the Environmental Grantmakers Association (EGA),
a coalition of foundations which gives money to environmental groups, began
giving serious consideration to a proposal to not allow for-profit corporations
to join its board. This move was precipitated by an attempt by Waste Management
Inc. to become an EGA member. EGA consists of 90 foundations that fund
national public policy and grassroots groups working for environmental
protection. Since 1987, the Association has met to share information and
ideas about issues and projects. Waste Management’s presence at EGA meetings
since 1988 created controversy within the group and led to the December
1989 vote on corporate membership. Waste Management is the largest publicly
held waste disposal corporation in the United States. In March of 1989,
California Waste Management, a subsidiary, pleaded no contest in the largest
criminal antitrust case in California history, paying a record $1 million
fine. Waste Management of Florida pleaded no contest to price fixing in
Florida’s Dade and Broward counties and was slapped with a $1 million federal
fine in January 1988. Waste Management also pleaded guilty in October 1987
to conspiring to fix prices in the Toledo, Ohio area with Browning- Ferris
Industries. And in May 1989, the U.S. EPA fined Chemical Waste Management,
a WMI subsidiary, a record $4.5 million for improperly burning PCBs at
a Chicago incinerator. Those opposed to WMI admittance to EGA argued that
Association members fund national and grassroots groups who undertake a
myriad of environmental projects, and many of these environmental groups
oppose the building of polluting disposal facilities, advocate toxic use
reduction and waste prevention and encourage communities to reduce solid
waste, all goals that conflict with WMI’s interests. “The presence of WMI
in such a funding community raises disturbing questions about the kind
of information the corporation will obtain and about WMl’s potential influence
on the opinions and decisions of grantmakers,” said Peter Bahouth, executive
director of Greenpeace USA. “It also grants legitimacy to a corporation
sorely in need of a positive environmental reputation.”
The 10 Worst Corporations of 1989 (full article)
Names in the News: Waste Mismanagement
CHEMICAL WASTE MANAGEMENT INC. (CWM), a subsidiary of Waste Management Inc. (WMI), admitted criminal guilt
in connection with its operations under the Superfund Law. The company agreed to an $11.6 million criminal, civil and
administrative settlement in October, in a Scranton, Pennslyvania U.S. District Court, for violations associated with the cleanup of
the Lackawanna Refuse Superfund Site. The settlement is the largest ever agreed to under the Superfund law.
WMI is the largest U.S. hazardous waste company, operating hazardous waste disposal facilities nationwide. WMI paid $8.1
million in fines for alleged environmental violations last year and $5.4 million in 1990. CWM was hired to move 60,000 tons of
contaminated garbage and more than 8,500 drums of hazardous waste at the Lackawanna site in 1987. The company began the
job in May 1988 and completed it in November 1988.
The government charged that CWM employees knowingly and intentionally crushed numerous drums containing hazardous
substances in order to speed up the project. The hazardous substances, including various solvents, paints, thinners, sludges, organic
acids and toxic metals, leaked out of the drums into the environment and contributed to the further contamination of the site. CWM
failed to report this activity in violation of the Superfund law.
“Unfortunate mistakes were made by a few of our people while cleaning up the Lackawanna site four years ago,” says D.P.
Payne, president of CWM. “Mistakes like these are costly and cannot be tolerated by the company.” CWM fired three of the
employees involved and has suspended three others.
– Ben Lilliston