Protecting the Earth or Just Pretending? A Fight for Credibility in the Recycling Industry
Patch looks into a courtroom clash that could kill the fastest growing company in Chicago Heights. First in a five-part series.
Reduce, reuse, recycle. There are about 3,000 companies in America devoted to those ideals, some making millions of dollars every year to put them to practice.
But what if they’re not?
What if these companies are lying to the many clients who sent them used products to recycle? What if the old computer you gave up was not being recycled at all? Do you care where it really goes?
Intercon Solutions, an electronics recycling company based in Chicago Heights, has been around since 1987. In 2000, a young businessman and police officer named Brian Brundage bought the company and over 11 years grew it from two employees to nearly 100.
In a time when it is frowned upon but more profitable to send materials to developing countries instead of recycling domestically, Intercon has been cited in the Chicago Tribune and the Wall Street Journal for going above and beyond to avoid such practices.
Such diligence could be detrimental to a company's bottom line. But Intercon still found itself recognized in Inc. magazine’s ranking of the fastest growing companies in America.
The firm probably won’t make that list next year.
More than a year ago, the Basel Action Network, a Seattle-based environmental watchdog group, made a powerful public statement in accusing Intercon Solutions of shipping waste to a foreign land and contributing to the poisoning of impoverished people in a developing country. That accusation, like a poison, is killing Intercon.
Now, BAN and Intercon are preparing for a courtroom battle for credibility that could spell the end for one of them. Intercon filed a lawsuit in Illinois state court against BAN in June, but the watchdog returned fire with a federal countersuit in September.
If BAN’s accusation is wrong, it has used faulty information to defame a business and could pay dearly for doing so if damages are awarded to Intercon. If BAN is right, Intercon is getting its just desserts, earning a public execution in front of the entire recycling industry.
In the spring of 2011, Intercon applied for the E-Stewards Certification, BAN’s coveted standard held by fewer than 40 recycling companies in the United States. The certification required a third-party audit, and Intercon obliged.
After the audit, BAN’s founder Jim Puckett sent a letter to Brundage that stated, “The Basel Action Network very much regrets that we will not be able to accept Intercon Solutions into the E-Stewards Certification program at this time.”
For the first time, BAN was rejecting a company. Why? In the letter, Puckett stated he had evidence that cathode ray tubes and batteries, considered hazardous materials by the U.S. Environmental Protection Agency, left Intercon’s Chicago Heights facility and landed in Hong Kong, China. Puckett noted that such an action may violate state and federal laws in the United States and waste importation laws in Hong Kong.
But Puckett didn’t just send his letter to Brundage. The USEPA, the Illinois State EPA, two other business certifiers and “selected news media” also received copies.
Once a media darling among recyclers, Intercon was in the papers for a new reason.
Intercon made around $3 million in sales in 2008 and nearly tripled that figure in 2011. Brundage was predicting $15 million in revenue for 2012. Since Puckett’s letter and the ensuing media coverage, however, his predictions have changed.
“I’m going to hope to make four or five million in sales this year,” Brundage said, leaning forward with a fist on his conference room table at Intercon Solutions. “Hope? Hope? We should have been at $15 (million). I had to lay off guys. It kills me to lay off guys. Kills me.”
More than half of Brundage's staff was gone in a year. Intercon currently employs an estimated 40 employees. Brundage expected to be at 150 by now. Brundage walked around the offices of Intercon pointing out empty desks in nearly every office of his sales department. A big proponent of hiring locally, Intercon has had to cut plenty of Chicago Heights residents from its staff.
Neil Peters-Michaud, CEO of Cascade Assets, a fellow electronics recycler in the Midwest, could attest to the effect Puckett's letter had on Intercon and its competitors in the Chicago area.
"A lot of people were like sharks going after Intercon’s customers when that news came out," Peters-Michaud said. "That may be just how this industry is."
Competitors may have been champing at the bit for Intercon's contracts, especially since the company has been accused of equally shark-like business practices in the past, according to Karrie Gibson, president of fellow Illinois recycler Vintage Tech.
"Intercon earned it themselves," Gibson said. "I don’t talk negative about our competitors, but they’ve tried to hurt me. It’s an older way of doing business, to talk about each other real negatively. Intercon just tried to work their way up the ladder using Vintage Tech."
Losing business to competitors was the last straw for Brundage, and the CEO made a move in filing his lawsuit this summer that would either rebuild or further ruin his company's reputation.
“It’s really been huge, and I never in a million years would have thought that one bad story, one bad issue, could erase 11 years of great press and publicity,” Brundage said. “But it did. It really did. That's when I decided to sue.”
On June 29, Intercon filed a lawsuit against the nonprofit watchdog group in a state court. Brundage contends that not only did the trailers in question not contain cathode ray tubes and batteries, Intercon wasn't even responsible for shipping them to China.
"We have factual knowledge on both of the trailers to know that both of them were not ours," Brundage said. "We’ve lost around 70 percent of our business due to the BAN's false allegations and defamation."
Patch's series on the conflict between Intercon and BAN:
- Part 2: Heights Recycling Company Builds Case Against Seattle Watchdog
- Part 3: Nonprofit and Ex-Employees Bash Heights Recycler's Business Practices
- Part 4: What's in a Name? Heights Recycler's Fate to be Decided in Court
- Part 5: Where E-Waste Lands: Laws, Stigmas and Truths
Jim Puckett's Letter: Read the BAN letter to Brian Brundage, in its entirety, in a PDF attached to this post.