City, Company Try to Stop Takeover of Waste Hauling Firm

In their campaign to keep a waste hauler with a history of political corruption out of the city, Thousand Oaks officials have joined forces with a Simi Valley company, obtaining a temporary postponement of a U.S. Bankruptcy Court decision while seeking to appeal the ruling in U.S. District Court.

Thousand Oaks and Benedor Corp. of Simi Valley hope to overturn a bankruptcy reorganization ruling last month that would allow Western Waste Industries to take over controlling interest in G.I. Industries, Ventura County’s second-largest trash hauler.

The company sought to postpone the implementation of Judge Robin Riblet’s ruling in federal court on Monday and obtained a temporary stay Thursday--finding an ally in Thousand Oaks, which filed legal papers saying it agreed with Benedor and also had its own reasons for opposing the reorganization.

Benedor is suing Conejo Enterprises, a subsidiary of G.I. Industries, for more than $40 million, alleging breach of a 20-year contract to recycle green waste. It opposes the bankruptcy plan because it believes some other G.I. creditors should not be paid before Benedor.

“We don’t think Benedor has been treated fairly,” said attorney Gerald Etchingham of Nordman Cormany Hair & Compton, the Oxnard law firm representing the recycler.

Thousand Oaks, meanwhile, opposes the bankruptcy reorganization because it would transfer the city’s waste-hauling contracts from G.I. to Western Waste, a Torrance-based firm whose checkered history and reputation it dislikes.

Thousand Oaks officials and City Council members have been concerned about Western Waste’s involvement in recent political corruption cases in Louisiana and Compton. The company is also the target of an FBI corruption and bribery probe.

“Western Waste Industries has notoriously violated health and solid waste laws, corrupted public officials, and mismanaged its business to the tune of astronomical fines and landing key executives and managers in jail or on probation,” Thousand Oaks officials argued in documents filed with the bankruptcy court earlier this year.

Benedor and Thousand Oaks were granted a stay until next month, when they will try to convince U.S. District Judge William J. Rea during a Jan. 28 hearing that they have worthwhile grounds to appeal Riblet’s ruling. Riblet had ruled that Thousand Oaks had no reason for concern, since Western Waste’s Thousand Oaks operations will be managed by the same individuals who had managed G.I.

Mike Smith, G.I.’s chief executive officer, said the combined efforts of Benedor and Thousand Oaks to derail what he considered a perfectly fair bankruptcy ruling have left him confused about the future.

Whatever its eventual outcome, the plan to appeal will prevent G.I. Industries from surmounting its financial problems for at least a few more months, he said.

“We were hopeful when the judge approved this in November that this dispute would have been resolved by now,” Smith said. “But now it appears that this is still very uncertain.”