For not the first time, or second, Waste Management is on the "hotseat" with the SEC, shareholders and their own employees! In a scenario that seems almost too bizarre to be true Waste Management's rosy projected second quarter earnings helped to make the value of Waste Management stock soar to nearly $60 per share, whereupon Waste Management executives sold over ONE MILLION shares of stock for over $56 Million! Then they revealed that second quarter earnings would be $250 million lower than projected, resulting in a slide in the value of Waste Management stock to a low of $25-15/16. Fortunately for the WM execs, they had the foresight to dump their stock before the plunge, saving themselves millions of $$$. The Wall Street Journal reported on July 9, 1999 that WMI's number 2 executive, Rodney Proto, collected over $16.5 million from the sale of WMI stock in the period before the announcement of an earnings shortfall. Unfortunately employees participating in a share purchasing plan and other shareholders were not so lucky.

It's comforting to know that not everyone is a loser in the WMI stock fiasco. Aside from the lucky Board members who managed to drop a large number of shares before the WMI stock plummeted, there are also a large number of law firms bringing class action suits against the company, also for some big bucks. The following is a list of some of the firms bringing these suits:

Whitting, von Sternberg, Emerson & Wilsher, L.L.P.;

Steven E. Cauley, P.A.;

Richard D. Kranich;

Spector & Roseman, P.C.;

Bernstein Liebhard & Lifshitz, LLP;

Shiffrin & Barroway, LLP;

Cohen, Milstein, Hausfeld & Toll, P.L.L.C.;

Wechsler Harwood Halebian & Feffer LLP;

Milberg Weiss Bershad Hynes & Lerach LLP;

Leo W. Desmond;

Finkelstein, Thompson, Loughran;

Pomerantz Haudek Block Grossman & Gross LLP;

Weiss & Yourman;

Levy and Levy;

Bernstein Litowitz Berger & Grossman LLP;

Stull, Stull & Brody;

Berman, DeValerio & Pease LLP;

Kaplan, Kilsheimer & Fox LLP;

Rabin & Peckel LLP;

Hoeffner, Bilek & Eidman, LLP.

Most of the suits involve words like "fraud," "violations of the Securities and Exchange Act of 1934," "issuing false statements," "artificially inflating stock prices," and so on. We will keep you posted on the results of these suits, if we can keep up with all of them!

The Wall Street Journal reported on August 16 that the board of Waste Management had ousted COO and President Rodney Proto and that John Drury had stepped down as CEO and Chairman. In late July the Chief Financial Officer and the General Counsel were dismissed. Drury was replaced on an interim basis by Robert S. "Steve" Miller, a "corporate turnaround expert," but was to remain as director of Waste Management. (On October 20, Drury resigned as the chairman of the board of directors, possibly due to health reasons.)

• August 1999 The Wall Street Journal revealed that WMI's Employee Stock Ownership Plan purchased additional shares only one week before the stock price plummeted. The Employee Plan is also bringing a suit against the company. WMI announces that the SEC is conducting an "informal inquiry."

• August 23, 1999 The Louisiana School Employees' Retirement System files a class action suit against Waste Management, alleging the company overstated its publicly reported financial results and made numerous materially false and misleading statements concerning the company's operating condition.

• October 5, 1999 Waste News announces that it has filed suit against one of its former officials, who allegedly "pocketed money from the sale of company trucks, containers and trailers and took kickbacks from vendors that did business with Waste Management." The official involved pleaded guilty earlier this year to a charge of underreporting his income.

• October 8, 1999 Bloomberg reports that "Investors have lost confidence in waste companies' strategy of buying smaller rivals, cutting costs and raising prices." They also reported that WMI may take longer than expected to find buyers for assets.

• October 11, 1999 Waste News reports an announcement by WMI that they pulled out of plans for a proposed new landfill in Joliet, IL, due to a ban on waste from outside of Will County, making the proposed landfill unprofitable. WMI also announced that it will be raising fees at the existing landfill from $38 to $42 per ton.

• October 12, 1999 Bloomberg reports that WMI has hired a consultant from Perot Systems Corp. to help improve WMI's computer systems. It adds that WMI is "working to regain credibility with investors after accounting errors" led to profit warnings.

• October 18, 1999 Waste News reports that WMI has offered to buy back all of the shares at the initial purchase price of those shareholders who "got stung," plus interest.

• October 21, 1999 WMI stock drops further to close at 16 13/16. It drops to a low of 14 during trading on 10/22. The stock has never made it as high as 20 per share during the month of October.

May 1, 1999 from an AP news story

WMI was fined $150,000 for illegally dumping medical wastes at the Charles City County Landfill in Charles City, VA. Curcuit Judge Thomas B. Hoover also ordered Waste Management to honor the terms of a consent agreement that was made with the Department of Environmental Quality in 1997, that prohibited WMI from bringing illegal medical waste into the state. The judge also criticized WMI for having only four people to inspect what amounts to 300 tons of garbage to be monitored every hour. Waste Management maintains that the medical wastes, which were shipped from New York, had just been overlooked.

The Palo Alto City Council voted unanimously to accept the transfer of The Palo Alto Sanitation Co. (PASCO) to WMI, following a closed door session about the Council's legal rights. Some local residents opposed the sale, as well as the Tri-Valley Sierra Club, citing a need for local control. WMI maintains that there will be no changes under the new owners in personnel, compensation or operations, and that it will use a business model taylored to the individual community. WMI has been sued by the Sierra Club and two other environmental groups over planned expansion, and the head of the Northern California WMI operations was indicted on charges last fall of stock manipulation.

December 21, 1998. From an article in BUSINESS WEEK

Waste Management has agreed to settle a shareholder class action suit for $220 million. This will be one of the largest settlements of its kind ever, if it is not altered in future agreements. The lawyer representing the shareholders wants to make sure that “out and out fraud” was not committed by Waste Management. There are other ongoing probes by the Securities and Exchange Commission for possible wrong doing by former WMI executives.

SCROD (South County Residents Opposing Dumps) was formed in early 1994 to fight a proposed landfill site in Lake County, Indiana. The community group has focused its efforts in three areas: the geotechnical, the political/legal, and maintaining community support. In 1995 USA Waste, now Waste Management, became the landfill operator. The following is the latest in their ongoing fight with Waste Management.

June 1999 from the Times

Indiana Supreme Court justices let stand a lower court decision that would allow the Lake County Plan Commission to create two residential subdivisions within a half mile of the proposed WMI ( formerly USA Waste) Hickory Hills landfill site. The lawyer for the plan commission is to appear July 6 before Lake Circuit Court Judge Lorenzo Arredondo for a hearing to lift a 3-year-old restraining order blocking a public hearing for the proposed subdivision. The proposed landfill could be blocked from opening because state law forbids the operation of a landfill within one-half mile of a platted subdivision.

Residents have been fighting the landfill's creation, believing it would not only pollute their ground water, but also might bring unwanted industrial development to their rural community. Petitions were filed in 1996 by David and Lucinda Coffman and Harry and Ruth Theile to subdivide their properties, which are adjacent to the landfill site. WMI-Hickory Hills has accused their opponents of proposing the subdivision in order to sabotage the landfill.

In the original suit, the company had sued the Plan Commission to stop the approval of the subdivision, and for the right to question the intentions of the families proposing the subdivision. In 1996 Judge Arredondo ruled that landfill lawyers could interrogate the families about the subdivisions' designs. The Indiana Court of Appeals ruled last year that Hickory Hills had no right to interrogate the families. The Supreme Court refused to hear an appeal of the matter by Hickory Hills.

The Plan Commission director, Wilbur Cox, said that once the court's restraining order is dissolved a hearing on the subdivision will be set. The Coffmans and Theiles, who contend it has always been their plan to build the subdivision, filed their subdivision plans before Hickory Hills applied for special zoning. The court's restraining order and the litigation that followed prevented a hearing for the subdivision and allowed Hickory Hills to get its zoning first.

Hickory Hills has also been unable to get a permit from the Indiana Department of Environmental Management to operate the landfill. IDEM has suggested Hickory Hills consider a smaller landfill, but the Lake County Solid Waste Management District, who had contracted with USA Waste/Hickory Hills in 1996 for the landfill, now maintains that no new landfill is needed.

WMI/Hickory Hills is suing the waste district for breach of contract for $200 million.

This article contains information about WMI's role in the disposal of radioactive sludge though a public sewer system in Colorado, and one citizen action group's response.

The Metro Wastewater Reclaimation District in Colorado asked for comments in December 1998 on a "permit" to be issued for the Lowry Landfill Superfund Site. This permit includes as "acceptable" the discharge into the sewer system levels of PLUTONIUM (yes, that's right, PLUTONIUM) over 150 times higher than existing drinking water standards in Colorado. (We know of no other state that has an "acceptable" level of plutonium in drinking water; this policy was denounced when it was adopted a few years ago, since independent scientists have argued that there is NO SAFE LEVEL OF PLUTONIUM. The allowable level for Plutonium 238+239+240 is 24 pCi/L.

Furthermore, the proposed permit allows for discharge of over 3 MILLION picocuries/liter of TRITIUM, In addition, Metro says it's OK to release Americium-241 (daughter product of plutonium, at 23), cesium-134 (12,300), Lead-210 (11), Potassium-40, Radium 226+228 (768), Strontium-90 (1,230). Thorium-228 (134), Thorium-230+232 (9,210), Uranium-234 (1,540), Uranium-235 (1,540), Uranium-238 (1,540).

These are all for 10 gallons per minute discharge. (Metro has said they expect to dump this stuff into the sewers for at least 30 years, that's how huge this site's contaminated groundwater problem is!) In addition to these radioactive compounds, many associated with nuclear waste dumping our citizens' investigation has documented, this permit will also allow numerous dioxin isomers and over 40 other pollutants, including most every toxic solvent and metal you can think of, including dioxins, PCB, cadmium, arsenic, mercury, etc.

OUR POSITION IS THAT THIS IS MIXED RADIOACTIVE HAZARDOUS WASTE AND THAT EPA IS COVERING UP THIS FACT TO PROTECT DOE AND ITS CONTRACTORS FROM LIABILITY. IF THIS PROCEEDS, THE LIABILITY WILL BE PASSED ONTO THE PUBLIC BY DISPERSING DEADLY RADIOACTIVE NUCLEAR WASTE INTO OUR FOOD SUPPLY, SINCE THEIR PLAN IS TO CALL THIS "FERTILIZER" FOR USE ON FARMLAND IN EASTERN COLORADO GROWING WHEAT FOR SALE TO THE COMMERCIAL FOOD DISTRIBUTION SYSTEM THROUGHOUT THE NATION AND PERHAPS INTERNATIONALLY.

Who will be the permittees for this? WASTE MANAGEMENT, INC. (you know their record of environmental crimes, price fixing, threats, etc.) [and] the City and County of Denver (The OPERATOR and OWNER of the Lowry Landfill site and the key PRP's). Is Metro Wastewater doing this to absolve itself of liability in a secret deal as they are another major polluter at this same site, where they dumped their sewage sludge for years? Is this a conflict of interest?

EPA says there are NO RADIONUCLIDES at this Superfund site, and have launched an attack against those who have spoken against this as "lunatics."

Adrienne Anderson is an Instructor of Environmental Studies at the University of Colorado at Boulder.  For additional information Adrienne can be contacted at (303) 492-4555 or by e-mail: andersa@spot.Colorado.EDU

• December 1998 United Waste Management, a Florida WMI subsidiary, agreed to pay penalties of $186,700 for violations that included improper storage of hazardous waste and failure to properly train employees. (EBIC)

• January 1999 San Luis Obispo County, CA, rejects WMI's attempt to take over a waste hauling operation, siting the company's history of violations and legal problems. (EBIC)

• USA Waste, who purchased Waste Management last year, has the distinction of having received the largest fine ever for illegal political contributions: $8 million. (INFACT)

• May 1999 Illegal medical waste is once again found at a WMI landfill in Virginia. Hospital employee error is blamed. (The Ledger-Star)

• May 1999 The price of sanitation service is going up in Charlotte County, Florida. And who owns both of the "competing" companies?...WMI. (Sarasota Herald-Tribune)

• May 1999 The chair of the New Hanover County, N.C., soild waste advisory committee is Chris McKeithan, head of Waste Management in Wilmington, N.C. No conflict of interest here! (Morning Star)

• May 1999 WMI is putting up for sale its share in Mexico's top waste hauler and seeking a judgement of $60 million against Mexico's government for breaching NAFTA. (Bloomberg)

• May 1999 The Wall Street Journal reports that the WMI board is refusing to pay about $40 million in pension and deferred compensation to its retired chairman, Dean Buntrock, and other former executives, pending the outcome of an SEC investigation into questionable accounting practices.

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