 	Environmental Technology Council

 1112 16th Street NW   (   Suite 420   (   Washington DC 20036   (  
(202) 783-0870

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December 17, 2008

Mr. Richard LaShier

Office of Solid Waste

U.S. Environmental Protection Agency

1200 Pennsylvania Ave., NW

Washington DC 20460

Re:	EPA-HQ-RCRA-2001-0032 

Dear Mr. LaShier:

	Thank you for the opportunity to respond to your request for
clarification of the ETC comments regarding the competitive harm to
hazardous waste companies that will result if aggregated electronic
manifest data that reveals customer lists in not categorically protected
as confidential trade secrets.

	First, we must clarify EPA’s observation that there is a large amount
of customer information already publicly available from state manifest
data and biennial reports.  Our point is that these data cannot be
aggregated into customer lists related to specific commercial hazardous
waste companies without a prohibitive investment of time, expense and
effort.  Sometimes so-called “data miners” attempt to collect and
manipulate the data and then sell the purported customer lists to
competitors.  These data miners generally start with state annual or
biennial reports.  However, some states accept the filing of paper
reports or electronic facsimiles such as PDF files.  These data are no
more useful to data miners than individual manifest forms.  Some states
compile report data into flat files or electronic databases that could
be manipulated to assemble customer lists, but these data are between
one and four years old.  Likewise, the BRS data compiled by U.S. EPA
from state submissions contains what must be considered historical data.
 For these reasons, data miners often attempt to obtain and compile
individual manifest data to supplement the state report data.  Paper
copies or manifests in electronic format, if available, must be obtained
directly from state agencies under state public records procedures,
often a daunting task.  Then the raw data must be compiled into a
searchable database management system, requiring substantial resources
for data processing, quality control, and verification.  The customer
lists compiled by data miners in this time-consuming and costly manner
are often incomplete, out-dated, marred by errors, and of limited value
to competitors.

	EPA’s electronic manifest database, on the other hand, could allow
competitors to easily obtain aggregated, complete, and time-sensitive
information on customers of specific hazardous waste companies.  The
courts that have addressed this specific issue have held that such
electronic compilations must be protected, even if the individual data
are otherwise available.  See, e.g., Northern Elec. Co. v. Torma, 819
N.E. 2d 417, 426 (Ind. Ct. App. 2005) (electronic compilation of motor
servicing information was held not to be readily ascertainable even
though all the information was publicly available in paper form).  While
a customer list derived from state data and the BRS generally would
relate to contracts completed from 1-4 years previously, the e-manifest
database will contain the identity of customers with current, on-going
contracts, and would therefore be much more valuable to competitors. 
Indeed, we have been advised by ETC member companies that if customer
data in the e-manifest database are not treated as trade secret
confidential, companies may simply choose not to participate in the
electronic manifest system and will continue to use paper manifests.

	To determine the quantitative harm that could be caused by disclosure
of a customer list derived from the e-manifest database, the ETC
utilized public information that is available from member companies. 
This analysis was prepared by the ETC based on historical information
and does not constitute forward-thinking statements for purposes of
securities laws or any representation by company management.  To
illustrate, one ETC member company provides multiple lines of waste
management services including incineration, solvent recovery, fuel
blending, landfill disposal, industrial site services, and aqueous waste
treatment.  The company has approximately 45,000 customers in almost all
major industrial sectors in the U.S. and Canada.  We examined each of
these service lines to determine the extent to which electronic
manifests would likely be used.  For services related to the company’s
fixed-based facilities such as incinerators and landfills, nearly all
shipments are currently subject to a hazardous waste manifest and
therefore customers would be included in an electronic manifest
database.  Indeed, it is common practice to use the manifest even for
shipments of industrial wastes sent to RCRA-permitted facilities. 
Likewise aqueous wastes that are received from customer facilities are
predominantly hazardous wastes subject to manifests.

	The only service line that involves a substantial portion of
non-hazardous industrial wastes is customer site services, such as tank
cleanouts and equipment cleaning.  Even these services frequently
involve some hazardous waste residuals that must be manifested for
disposal, and thus would also be included in an e-manifest database.  It
is worth noting that if a customer makes just one shipment under a
manifest, that customer would be identifiable in an e-manifest database,
even if a significant volume of business is non-hazardous wastes.  As a
conservative assumption, however, we have assumed based on an analysis
of service lines that 20% of the company’s services are provided to
customers that do not utilize a hazardous waste manifest for any
purpose, and therefore would not be included in an e-manifest database.

	Another ETC member company is primarily engaged in the highly
competitive business lines of solvent parts cleaning and oil collection
services and re-refined products, as well as containerized waste
services, vacuum services, and emergency response services.  This
company has approximately 330,000 customer locations across a wide
variety of industries, and virtually all of their waste business
services utilize the hazardous waste manifest, even for small quantity
customers.  These two ETC member companies generated combined revenues
for their waste-related services in 2007 in the range of $1.8 to $2.1
billion.  This is consistent with revenue estimates by industry analysts
such as Farkas Berkowitz that put total revenues for the hazardous waste
industry, including the remainder of ETC member companies, in the range
of $3 to $3.5 billion.

	Using conservative estimates of manifest-related revenues as described
above, the quantitative harm to a large ETC member company that would
result if e-manifest data were aggregated into a customer list and just
1% of business were lost to competitors as a result would be in the
range of $7 million to $9 million per company.  Obviously, if a larger
share that 1% were lost, the harm would be commensurately greater. 
Addressing the issue differently and using an average revenue per
customer ratio, the loss of just 100 customers to competitors as a
result of an e-manifest customer list would result in harm of between
$500,000 to $2 million per company in decreased revenues, depending on
the company’s total customer base.  Thus, a company that uses the
proposed e-manifest system would face substantial competitive harm if
e-manifest data could be aggregated into customers lists and disclosed,
rather than protected as confidential or trade secret business
information.

	Thank you for the opportunity to provide this clarification to the ETC
comments.  Please contact the undersigned if you have any further
questions.

Sincerely,

David R. Case

Executive Director

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