Abrupt warehouse shutdown strands 250,000 mattresses, leaves workers without jobs

Nearly a dozen employees of a Fresno warehouse that took in hundreds of used mattresses and box springs each week for recycling are waiting to hear when – or if – they will receive their final paychecks after being laid off with no warning.

In the meantime, about 250,000 mattresses are sitting in storage in Fresno as wrangling continues over whether they will be recycled or dumped.

Blue Marble Materials, the largest processor in California’s official mattress recycling program, closed down operations at its Fresno intake warehouse on Sept. 26 amid a dispute over the Commerce-based company’s ability to live up to its contract with the Mattress Recycling Council.

The building in an industrial warehouse complex on South Elm Avenue was locked up and dark this week when a Bee reporter visited. Signs taped to the front window proclaimed in Spanish and English that the center – where residents could drop off their old mattresses and box springs to be recycled instead of taken to landfills – was closed.

A less conspicuous notice from the company’s landlord, taped to the front door and dated Oct. 3, gave Blue Marble and its CEO, Tchad Robinson of Los Angeles, three days to pay more than $37,000 in rent due for September and October or vacate the Fresno premises. Phone calls to the center were answered by a message saying the office was closed and that no date was known for reopening.

At the rear of the building, near the loading docks, old mattresses being dropped off by people were starting to pile up – right next to a hand-drawn “no dumping” sign. Three Blue Marble semi trailers were still poised at the loading docks.

At Blue Marble’s headquarters in Commerce, a woman who answered the phone said she could not discuss anything about the company and abruptly hung up. And no activity was evident for the company at two other Fresno industrial parks where Blue Marble operated mattress-storage warehouses as recently as this summer.

No one answered the phone at Blue Marble’s Bay Area facility in San Leandro.

The state’s recycling program

California’s mattress recycling program was launched under state law in late 2015 as a way to try to divert the bulky materials away from landfills and dissuade illegal dumping of mattresses on roadsides, empty lots and alleys, with a goal of recycling 75 percent, by weight, of materials recovered from mattresses and box springs by 2020.

Under the state’s program, which is managed by the mattress-industry sponsored nonprofit Mattress Recycling Council, customers pay a $10.50 recycling fee for every mattress they buy at a bedding or furniture store. That money goes toward paying companies that handle the recycling of old mattresses and box springs, including $3 payments to residents who bring in old mattresses to collection centers.

The Mattress Recycling Council’s annual report for 2017 indicates that retailers sold more than 4 million mattresses and box springs last year, generating more than $44.5 million in recycling fees.

Also in 2017, the MRC reported that nearly 1.3 million used mattresses were collected statewide under the recycling program, and that contracted recyclers such as Blue Marble reclaimed more than 36.8 million pounds of steel, wood, foam, quilting, cotton, felt and other material.

Almost 383,000 additional mattresses that were not suitable for recycling – either because they were too soiled, wet, or infested with bedbugs and other insects – were disposed of in landfills last year, according to the MRC.

The state’s Department of Resources Recycling and Recovery, or CalRecycle, is tasked with overseeing the Mattress Recycling Council’s program. But the state agency was criticized in an August audit for lax oversight of the industry-sponsored recycling program, including establishing interim goals en route to the 75 percent goal in 2025, collecting insufficient data to document whether the program is meeting its goals, and allowing the MRC to accumulate more than $42 million more than it has spent on recycling.

Blue Marble’s Fresno operations

The Fresno center served as a collection and transfer facility, taking in old mattresses and box springs from residents and larger customers such as motels. An employee at the company told The Bee that box springs would be stripped and dismantled for wood, metal and material to be separated and baled. Those baled materials, as well as mattresses, would be loaded into semi trailers and hauled to Blue Marble’s headquarters in Commerce. That’s where mattresses would be taken apart for springs, wood, foam padding, fabric and other components to be recycled and sold for new uses.

Marie Clarke, vice president of industry and external affairs for the Mattress Recycling Council, said Blue Marble was the largest participant in the state’s mattress recycling program, handling about half of the total volume of mattresses and box springs processed for recycling over the past couple of years. The MRC, however, terminated its agreement with Blue Marble over the company’s failure to be able to fully account for how many mattresses it was taking in, accumulating an excessive backlog of unprocessed mattresses, and not living up to its obligations to purchase additional automated shredding equipment to speed its dismantling and processing of mattresses and box springs.

A Blue Marble employee, who asked to remain anonymous, said workers reported to work in Fresno on Sept. 26 and began their usual tasks of taking in dropped-off mattresses, giving out the $3-per-mattress payout, and loading and unloading trailers when the local manager came out and told them to stop what they were doing and that the warehouse was closing at noon.

California journalism nonprofit CALmatters reported Thursday that Blue Marble had about 250,000 unprocessed mattresses in storage in Fresno; the Blue Marble employee confirmed to The Bee that was an accurate estimate of both “baled” and loose mattresses and box springs scattered among the three Fresno sites.

The employee added that “we were promised that this facility was expanding, that we were growing and adding more equipment,” including a new baler that came in about a week before the shutdown. “This is affecting what is supposed to be an awesome program that is helping all these people, and now it’s nothing,” the worker said.

The company’s paydays were on the first and 15th of every month, but employees have not received their Oct. 1 paychecks. After trying to contact Robinson, Blue Marble’s CEO, “we haven’t gotten an email, not a phone call, nothing,” the employee said.

Most of the workers have already filed for unemployment benefits, but some are still holding out hope that the company may reopen.

Others are less hopeful. Rob Sanchez, a truck driver for Blue Marble for the last 10 months, said he’s still gotten no official word from the company that it is closed, only that “our work has been stopped indefinitely.”

“It was a good company to work for,” Sanchez said. “It didn’t have benefits, but the pay was good, the hours were good, and they were flexible with our schedules if need be.” Sanchez said that his work schedule usually afforded him with a couple of hours of overtime pay each day, which further padded his regular pay of about $19 per hour.

Initially, he said his job included hauling trailers full of mattresses from landfills and other collection sites to the Elm Avenue site or to the two other Fresno warehouses. Later, the work switched to making longer runs between Fresno and San Leandro as well as to and from the main mattress-dismantling facility in Commerce.

While he’s filed for unemployment and reached out to the state Labor Commissioner’s Office over the skipped Oct. 1 paycheck, Sanchez said he will soon be rejoining one of his previous employers.

Ongoing problems

Reopening may be unlikely. The company’s Elm Avenue landlord, Span Development LLC in Madera, posted a three-day notice giving Blue Marble until Oct. 6 to either pay more than $37,000 owed for its rent for September and October or to get out. Phone messages left on Thursday and Friday by The Bee for a representative for Span Development were not returned.

The Mattress Recycling Council, in the meantime, is trying to figure out what will happen with the quarter million mattresses sitting in storage in Fresno. “If they have 250,000 mattresses in storage, that’s not what we’re paying them to do. We’re paying them to recycle them,” Clarke said. “The fact that (Robinson) was stockpiling them is concerning. We’re going to arbitration to figure out if we’ve already paid for them, because we’d like to recycle them, or if they are Blue Marble’s property.”

Clarke said the lack of adequate record keeping was one of the main points for the MRC’s action to terminate the Blue Marble contract on Sept. 21 – five days before the Fresno site was abruptly closed.

An audit of Blue Marble’s operations conducted for the MRC also found that Robinson was unable to secure the needed financing to purchase the mattress-processing equipment that he had promised to provide when Blue Marble and MRC renegotiated their contract in May.

In a biography on Blue Marble’s website, Robinson details his experience in private capital investing and management consulting. Business filings with the California Secretary of State indicate that Robinson established Eco-Modity LLC, a company that does business under the Blue Marble Materials name, in late 2012.

A search of public records databases indicates that since launching Eco-Modity/Blue Marble, Robinson has endured several state and federal tax liens: an IRS lien filed in December 2013 for almost $158,000; a state tax lien filed, and later released, in mid-2015 for about $2,600; and another IRS lien filed in July for more than $10,000.

Clarke said MRC does not expect the termination of Blue Marble’s contract to disrupt the state’s recycling program. “Fresno is actually blanketed in drop-off sites,” she said. “For the most part, consumers who are interested in dropping off their mattresses won’t have a problem finding a place. “

MRC has also reached agreements to divert the processing volume that was handled by Blue Marble to other participating recyclers “who are eager to process more mattresses,” and is in the process of soliciting bids from other companies for breaking down mattresses and salvaging their innards for sale.

This story was originally published October 5, 2018 at 3:56 PM.