• High Tech Business Begets High Tech Environmental Problems
  • May 5, 2003 | Author: Antoinette R. Stone
  • Law Firm: Buchanan Ingersoll & Rooney PC - Philadelphia Office
  • Just as corporate America breathes a collective sigh of relief that the costly and burdensome Superfund program appears to be languishing in the quagmire of the federal bureaucracy, a new environmental bugbear may be looming on the horizon. This new threat to the bottom line will affect not only the chemical companies and industrial facilities, but also every business that uses computers and other electronic equipment. In today's fast-paced, high-tech economy, that includes most businesses.

    In the 1960's, computers may have lasted ten years on average. Today, the average is 4.3 years and, in the case of the most advanced products, less than two years. This accelerating rate of obsolescence is accelerating the generation of waste electric and electronic equipment (known in the waste industry as WEEE).

    The annual increase in the generation of WEEE is conservatively estimated to be three times the growth of average municipal waste. Significant environmental problems are caused by the hazardous components of WEEE, including heavy metals, such as mercury, lead, cadmium, halogenated substances, such as chlorofluorocarbons (CFCs), PCBs, and PVC, plus asbestos and arsenic. Such substances are not unknown in waste management, but the exponential increase in the amount of WEEE is magnifying the hazard to the environment and straining the ability of waste facilities to handle it. The cost of proper disposal of obsolete computers and other electronic equipment is significantly higher than merely paying more to the local trash hauler to take it to the landfill. Special treatment ranging from separate collection to stringent controls at the incinerator smokestack to pretreatment to recycling will account for the increased cost of WEEE disposal.

    The European Parliament has enacted extensive legislation regulating WEEE disposal that is scheduled to go into effect in 2001. Europeans will soon be required to comply with a host of requirements, including improved design of electronic equipment at the manufacturing level, manufacturer liability for waste management, and compulsory recycling. Other countries, including Japan, are also beginning to address the problem.

    Court tests of the Superfund law firmly established retroactive liability without regard to fault. Corporate America learned the hard way that "lying in the weeds," i.e. pretending to ignore the regulatory onslaught that was taking place around it, did not provide much protection from Superfund liability.

    The expensive lessons of Superfund should not have to be relearned. Although federal law in the U.S. does not yet specifically regulate the disposal of electronic equipment, businesses can and should be proactive now. Determine where your old computers are going. Figure out if there is an economical way to recycle old equipment. Round up your insurance policies and have them examined by an expert to determine the extent of your current coverage and the availability of additional coverage. Pay attention to the contracts with your waste haulers. Courts generally uphold carefully drafted indemnification agreements between business partners that apportion liability. Insert litigation avoidance provisions in your contracts to curtail the endless rounds of litigation. Now is the time to act, before the regulators impose tight compliance deadlines, before the litigation starts, before the insurance companies slam the door on coverage.