The records included patients' names and Social Security numbers, potential fodder for identity theft, said Assistant Utah Attorney General Richard Hamp.

Nelson Refining Systems defends its handling of the records, and has sued KSL Radio and Television for coverage of the alleged incident. The firm destroys records and recycles silver-bearing wastes and X-ray films, according to its Web site.

And it is unclear what law is available for state officials to prosecute improper disposal of identifying medical documents.

The Legislature last year created a civil penalty for leaving such medical information in an unsecure location, with fines up to $100,000. But the law doesn't take effect until Jan. 1.

"It may be that we're frustrated by the lack of three weeks," Hamp said.

Medical records also are protected by the federal Health Insurance Portability & Accountability Act of 1996, or HIPAA, which applies to health care providers, related businesses and health officials. It carries severe penalties, including fines up to $250,000 and up to 10 years in prison.

To date, the office of the U.S. Attorney for Utah has not prosecuted any HIPAA cases.

It is considering an investigation, said spokeswoman Melodie Rydalch. "The facts as we've heard are something we'd definitely be interested in taking a hard look at," she said.

The lawsuit filed Wednesday against KSL alleges its coverage was inaccurate.

"It wasn't a Dumpster, it was a recycling bin," said Brenda Flanders, a lawyer representing the company. "And it wasn't 20 feet from the sidewalk."

The bin was "out of the public domain" and its contents are collected by a company that shreds the documents inside, the lawsuit asserts. "At no time is the recycle bin subject to public dissemination," it claims.

Sheryl Worsley, managing editor of KSL Newsradio, said the station stands by its story. "The records were accessible to anyone," she said in a statement. "We found them in plain view, near a busy street, in an open recycling dumpster just 20 feet from the sidewalk and right next to a fast food restaurant drive-through."

The property was not marked private or fenced off, she said. The site was visited at least six times, and each time, the bin "was unlocked, sometimes with the lid wide open," she added.

University Health Care has suspended its business with Nelson Refining Systems, said spokesman Chris Nelson. The health system destroys most medical records on site, he said, but hired the company to dispose of radiology records because of environmental regulations.

"Our investigation is ongoing," Nelson said.

Jill Vicory, spokeswoman with the Utah Hospital Association, said the majority of hospitals in the state have contracts with Nelson Refining Systems. The group alerted members to the alleged violations, and "many contract relationships [with Nelson] have been ended by our members," she said.

chamilton@sltrib.com