The National Association of Wholesaler-Distributors (NAW) filed a lawsuit against the Oregon Department of Environmental Quality and others in the United States District Court for the District of Oregon, challenging the constitutionality of Oregon’s Plastic Pollution and Recycling Modernization Act. The Act creates an “extended producer responsibility” (EPR) program intended to encourage a circular economy and modernize the state’s recycling program. Unfortunately, as enacted, the act misses the target and threatens the viability of the wholesale distribution industry nationwide – the cornerstone of America’s supply chain.
“While NAW supports the goal of a circular economy, the Oregon EPR law, as enacted, is unconstitutional, creates new mandates, inhibits interstate commerce, and fails at its primary goal of encouraging circularity,” said Eric Hoplin, President and CEO of NAW. “Rather than encourage sustainability through a uniform and transparent system where compliance burdens are shared across industries, Oregon chose to shift the burden to the parts of the supply chain that have little to no control over decisions to design, reduce, reuse, or recycle a product.”
NAW’s lawsuit alleges that with this law, Oregon unconstitutionally:
- Delegates control over the EPR program, including the setting of fees wholesaler-distributors must pay to a private, third-party group (the Circular Action Alliance (CAA)), with a financial interest in the program, without clear rules or oversight.
- Unfairly targets out-of-state producers, disrupts national markets, and tries to control business outside of Oregon—violating the U.S. Constitution’s limits on state regulation of interstate commerce.
- Mandates producers sign contracts with a single approved private organization (CAA), giving up their economic freedom and due process rights.
- Subjects producers to fees and rules set by CAA without a real chance to object or appeal, or transparency in the process.
