How a Legal Storm Brewed Over E-Scrap in Tennessee

How a Legal Storm Brewed Over E-Scrap in Tennessee

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Anyone doing business with public agencies knows that government can be, to say the least, fickle and unpredictable. At times, sad to say not often, an individual or department delivers timely consideration and, for better or worse, a reasoned decision. All too frequently, however, one encounters inexplicable delay, callous indifference or sheer mindlessness. For example, what does a contractor do when an agency, over a period of years, shows no signs that it is unhappy about performance—indeed, admits it’s a great working relationship—and then suddenly seeks to punish what it had ignored or condoned? Here’s what.

In 2005, the Tennessee Department of Environment and Conservation (TDEC) invited proposals for the collection and disposal of household hazardous waste. Clean Harbors Environmental Services responded and eventually won a three-year contract, which included the handling of electronics scrap material or e-scrap. The agreement obligated Clean Harbors to, among other things, arrange waste pickup, conduct collection events, and transport waste to a recycling or disposal facility subject to TDEC approval, and, specifically, no waste could leave the United States without prior written consent. With its invoices, Clean Harbors submitted copies of the manifests (under which the wastes were shipped off-site) and signed certificates of disposition from the final disposal or recycling facility.

Shortly after the contract was signed, Clean Harbors proposed using Supreme Asset Management Recovery (SAMR), located in New Jersey, as a disposal facility for e-scrap, and TDEC approved the selection. Clean Harbors transported e-scrap to SAMR without incident for almost three years. Clean Harbors’s agreement with SAMR required SAMR to maintain complete records on how it performed its services and gave Clean Harbors the right to audit its records and inspect its facilities. However, the agreement did not prohibit SAMR from exporting waste received from Clean Harbors. Before engaging SAMR, Clean Harbors conducted an audit and found that SAMR did indeed export e-scrap out of the country.

Following widespread media reporting on e-scrap exportation from the United States to foreign lands, participants at household hazardous waste collection events began asking questions about the fate of the material. Responding to the public’s mood, TDEC, in April 2008, launched an investigation of Clean Harbors and SAMR with the objective of following the e-scrap through the entire recycling and disposal chain.

The TDEC probe yielded documents indicating SAMR shipped glass cullet to Samtel Group, India’s largest integrated manufacturer of a wide range of displays for television, avionics, industrial, medical and professional applications. TDEC also obtained bills of lading showing SAMR shipped glass and CRTs to L.G. Philips Display Brazil, Ltda, in Brazil.



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