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Strategies & Market Trends : Three Amigos Stock Thread -- Ignore unavailable to you. Want to Upgrade?

To: James Strauss who wrote (6624)	7/3/1998 10:32:00 PM
From: James Wright	Read Replies (1) \| Respond to of 29382

Jim -- Early in my legal career I did a lot of Superfund work in some of the leading cases at that time. For example, I was one of the trial attorneys in the infamous Love Canal case that arose in Niagara Falls, New York, in the 1970s. Without spending too much time on this issue, I simply raise a word of caution about any metal recycling company. Many metal recycling facilities have very heavy environmental liabilities. This especially is true of older facilities. The clean up costs can be enormous -- tens of millions of dollars or more is not unusual. And the current owner of a site generally is liable for those costs (as are others), even if the company did not own the site back when the problems originally were created. I don't have any specific information about RECY. However, I suggest you ascertain the degree to which the company has exposure for potential clean up costs. If the company says none, then I wouldn't believe them. Again, however, I have no specific knowledge about RECY, this is simply based on what I know to be generally true about metal recycling facilities. Given that RECY seems to be on a buying spree for older companies, I suspect there may be a lot of hidden future cleanup costs for which RECY will be liable. Thus, I wouldn't invest in such a company. All it takes is for EPA to put just one facility on the Superfund list, and the company will be facing potential liability exceeding its annual profits from all of its other facilities put together. -- Jim