Lawsuit seeks injunction and civil penalty against two metal recyclers

January 09, 2017 05:40:05 AM

LOS ANGELES (Scrap Monster): A civil lawsuit has been filed against two Los Angeles metal recycling companies for violating laws pertaining to scrap metal transactions. Gonzalez Brother LLC and Kinsbursky Brothers Supply Inc. (KBI) have been alleged of dealing with stolen catalytic convertors without proper bookkeeping. Also, the companies failed to adhere to the payment requirements as prescribed in the State law.

The lawsuit pleads for injunction against the operators of the scrap metal facilities, thereby preventing further illegal transactions. It also calls for civil penalties up to $2,500 for each violation.

According to the lawsuit, Gonzalez Brother LLC knowingly purchased stolen catalytic convertors and resold them to other recyclers. No proper recordkeeping was maintained for these transactions. Further, the company was found involved in cash transactions. A raid conducted by authorities at the scrap metal facility premises recovered over 300 catalytic convertors. A scrutiny of the records showed that it lacked identifying information as required by the law.

Investigations by CCTF authorities had showed that Anaheim, California based Kinsbursky Bros. was one of the largest buyers of Gonzalez Brothers. None of the purchase transactions had supporting documents containing mandated legal information as prescribed by the law. Moreover, the company also failed to produce written agreement between the companies to indulge in sale and purchase of used catalytic convertors.

Meantime, Kinsbursky Bros., in a statement refuted the charges, noting that the company has already demonstrated to City Attorney’s Office that it has complied with all recordkeeping requirements. In addition, the company has been using the City Police Department’s reporting system for purchase of catalytic convertors. It termed the accusations as meritless and stated that it will go ahead with necessary litigations.

The California Legislature had adopted Senate Bill No. 627 in 2009, in an attempt to curb growing number of catalytic convertor thefts in the state. According to the Los Angeles Police Department (LAPD), over 4,300 complaints of catalytic convertor thefts have been reported in the past four years. During April 2015, LAPD had introduced a special task force named Catalytic Converter Task Force (CCTF) whose sole duty was to investigate and deal with catalytic convertor thieves.

SB 627 requires a recycler who accepts, ships or sells used catalytic convertors to maintain specified information regarding the purchase and sale of catalytic convertors for not less than two years. The bill requires the recycler to obtain a photograph or video of the seller, a written statement regarding the origin of the catalytic converter, and certain other identifying information, as specified. Moreover, the recycler is liable to provide this information for inspection to enforcement authorities upon demand.

The recycler who accepts catalytic convertor for recycling is required to maintain a written record that contains the place and date of sale; name, valid identification number of the seller; vehicle license number of the vehicle in which the material was transported to the premises. If the seller is a business, the written record shall include the name, address, and telephone number of the business. The record must also contain a description of the catalytic convertors. The recycler is also required to obtain a statement indicating either that the seller of the catalytic converter is the owner of the catalytic converter, or the name of the person from whom he or she has obtained the catalytic converter.