The next time a government inspector comes to a business and inspects its dumpster, do not be surprised if the resulting legal problem involves both environmental and consumer fraud actions. During the last few years, a number of national corporations have found themselves in legal trouble because the inspector found both hazardous waste and customer records containing personal information in a dumpster. If the business is in New Jersey that means it will be dealing with both the Department of Environmental Protection and the Division of Consumer Affairs’ Office of Consumer Protection. Needless to say, it is a situation to avoid.
Many items routinely handled by a business, including retail businesses, become a hazardous waste when disposed. These may include returned or excess inventory consumer products as well as cleaning and building maintenance products used at the business. Determining if they become hazardous waste when disposed often requires analysis not readily available at the disposing facility. Failure to know if disposed material is a hazardous waste can lead to substantial fines and even criminal prosecutions if it is improperly disposed. Any business should have a plan for determining if the materials disposed are hazardous waste subject to regulation and, if so, to ensure that the hazardous waste is handled and disposed of legally.
Many businesses are aware of the hazardous waste issues referenced above. Fewer are aware of this obligation imposed by New Jersey law with regard to disposal of customer information. “A business or public entity shall destroy, or arrange for destruction of, a customer’s records within its custody or control containing personal information, which is no longer to be retained by the business or public entity, by shredding, erasing, or otherwise modifying the personal information in those records to make it unreadable, undecipherable or nonreconstructable through generally means.” New Jersey is not alone in regulating the disposal of customer records. In states with such laws or regulations, any business having such records should also have a plan for their legal disposal. In New Jersey, the amount of actual damage to a consumer is automatically tripled, the consumer is automatically awarded attorney fees and costs and fines may be imposed up to $10,000 for a first violation and up to $20,000 for each subsequent violation. In some states, each disposed customer record is a separate violation.
The recent cases against national companies are likely only a prelude to similar actions against state or local business. When the inspector comes, those business should know that what is in their dumpsters does not include hazardous waste or discarded customer records containing personal information.