Connecticut Attorney General's Office

Press Release

Attorney General Sues Imprisoned Trash Hauler To Recover Millions For Defrauded Consumers

October 27, 2009

Attorney General Richard Blumenthal today sued imprisoned trash-hauling magnate James E. Galante in an effort to recover millions of dollars for customers harmed by artificially inflated trash hauling contracts and bid rigging.

Galante is currently serving an 87-month prison sentence at a federal correctional facility in Pennsylvania for bid rigging, conspiracy to commit wire fraud and income tax violations. His conviction followed an extensive investigation into Connecticut's trash hauling industry by the U.S. Attorney's Office, Federal Bureau of Investigation (FBI) and the Internal Revenue Service (IRS). The wide-ranging federal investigation produced convictions of a number of co-conspirators in Galante's scheme.

Blumenthal's lawsuit seeks to recover money for thousands of Connecticut consumers defrauded by Galante.

Galante artificially raised contractual prices to his commercial customers by 10 percent, each time falsely claiming that he was simply passing through increased disposal costs, which customers were forced to accept under their contracts. In reality, Galante's disposal costs remained virtually unchanged and actually decreased at least once during that period.

Additionally -- on at least two occasions -- Galante and a competitor agreed to rig bids for certain trash hauling contracts in Connecticut, including one for Yale University.

"James Galante deserves prison, but consumers deserve restitution -- millions of dollars for bid rigging and price manipulation that inflated trash hauling costs in southwestern Connecticut," Blumenthal said. "Victims of Galante's racketeering and bid rigging conspiracy -- thousands of small businesses overcharged millions of dollars -- deserve money back for Galante's fraud and deceit.

"Galante enriched himself by manipulating the market with his powerful waste empire in Connecticut, rigging bids and falsely blaming 10-percent price hikes on increased disposal costs. In reality, Galante was padding his profits and funneling illegal windfalls to his own professional hockey and automobile racing teams at the expense of customers, who unknowingly subsidized these extravagances.

"This action was made possible by the assistance provided by the U.S. Attorney's Office, and agents of the FBI and IRS, and I commend them for their leadership and enforcement action against Galante and his co-conspirators. Through a dedicated team of prosecutors and investigators, federal authorities successfully sent Galante to prison and extracted substantial criminal fines."

Galante's trash hauling empire in southwestern Connecticut and parts of New York included Automated Waste Disposal, Inc. (AWD), Thomas Refuse Service, American Disposal Services of CT (ADS), Transfer Systems Inc. (TSI) and Greensphere Inc.

In 2006, the federal government indicted Galante and co-conspirators on charges including violations of the Racketeer Influenced and Corrupt Organizations Act (RICO). Galante eventually pleaded guilty to racketeering conspiracy, conspiracy to commit wire fraud and conspiracy to defraud the Internal Revenue Service.

In addition to prison, Galante's sentence included a $100,000 criminal fine, a court order prohibiting him from future involvement in the trash hauling industry, and a requirement that he forfeit all of his interests in his various trash-related companies to the federal government.

Blumenthal, whose office received significant assistance from the U.S. Attorney's Office, is suing under the Connecticut Antitrust Act and the Connecticut Unfair Trade Practices Act in coordination with Department of Consumer Protection (DCP) Commissioner Jerry Farrell, Jr.

Blumenthal thanked those in his office who worked on the investigation, including Assistant Attorney General Gary Becker, Forensic Fraud Examiners David Boucher and Lawrence Marini and Paralegals Lori Measer and Holly MacDonald, under the direction of Assistant Attorney General Michael Cole, Chief of the Attorney General's Antitrust Department.

View the entire Galante complaint - (PDF-2.67MB)