Deep Dive: How Lawsuits Are Shaping EPR Rollout

Sep 22, 2026

We recently hosted our latest quarterly Inside EPR webinar, “How Lawsuits Are Shaping EPR Rollout,” covering the legal challenges working their way through court against packaging Extended Producer Responsibility (EPR) laws in Oregon, California, and Colorado, including a major ruling that landed just days before we went live.

If you missed it, you can access the full webinar recording and slides here.

In the meantime, here are some highlights.

Oregon Delivers a Decisive Win for EPR

On August 27, just days before our webinar, a federal judge delivered a win for Oregon’s packaging EPR program in NAW v. Feldon — the first packaging EPR lawsuit in the country to reach a full bench trial. The National Association of Wholesaler-Distributors (NAW) had argued that Oregon’s law violated the Dormant Commerce Clause by unfairly burdening interstate commerce. They also argued it violated Due Process, since producers had no meaningful way to challenge how their fees were calculated. The court rejected both claims outright, calling Oregon “a pioneer in waste prevention and recycling legislation for more than half a century” and its program an example of “innovative leadership.”

What This Means for Other States

This is the first time a federal court has tested packaging EPR’s constitutionality after a full trial, not just a preliminary ruling, and the impact reaches well beyond Oregon. The preliminary injunction that had paused enforcement for NAW members since February is now lifted, so all Oregon producers are fully subject to the program. NAW is making these same Dormant Commerce Clause and Due Process arguments in its ongoing suits against California and Colorado. A thorough, 71-page ruling rejecting those exact theories doesn’t bind those courts, but it’s a significant headwind. Program structure differences across states still matter, and NAW can still appeal to the Ninth Circuit. Still, the core constitutional foundation for packaging EPR just got considerably stronger.

Three Legal Challenges in California

California is currently facing three separate lawsuits touching its packaging EPR law, SB 54, and the related recyclability labeling law, SB 343:

  • “Too far:” Seventeen state attorneys general, led by Nebraska, are suing to block SB 54 under the same Dormant Commerce Clause and Due Process theories that just failed in Oregon. NAW separately filed its own request to block SB 54 enforcement just days before losing its Oregon case.
  • “Not far enough:” Environmental groups, including the Natural Resources Defense Council (NRDC), are suing CalRecycle, arguing the finalized SB 54 regulations fall short of the law’s ambitions. Chemical manufacturers and a farm coalition have asked to join the case in defense of the regulations.
  • SB 343 labeling law: a coalition of food, packaging, retail, and consumer goods trade associations sued over SB 343’s restrictions on “recyclable” claims. A court paused Attorney General enforcement in July while the case continues — the law hasn’t been struck down, just paused.

Two Cases to Watch in Colorado

Colorado has two of its own pending cases. One — Independent Lubricant Manufacturers Association (ILMA) v. CDPHE — challenges the state’s Producer Responsibility Organization (PRO) structure on due process grounds similar to NAW’s Oregon arguments. The other is NAW’s own suit against Colorado, generally viewed as weaker than its Oregon case since Colorado producers aren’t required to join a single PRO the way Oregon’s are. Both cases now face a tougher road following the Oregon outcome.

What Producers Should Do Now

Our advice hasn’t changed: keep complying. Betting on litigation to erase your obligations is a costly gamble. Non-compliance now means back fees, potential penalties, and a compressed catch-up timeline if the outcome doesn’t go your way.

California’s ISR Plan Requirements Just Got More Flexible

In an update for California producers, CalRecycle announced on July 17, 2026, that Individual Source Reduction (ISR) Plans will no longer be binding commitments with the Circular Action Alliance (CAA), and instead they’re now primarily a data collection and planning exercise. This gives producers room to be realistic about what they can achieve each year, rather than risk being held to an early, overly ambitious commitment.

The Compostability Debrief in California: AB 1201, Failed Bills, and CAA’s Next Move

SB 54 allows compostable packaging as one path to compliance. However, a separate law, AB 1201, is set to block most compostable bioplastics (like PLA, PHA, and PBAT) from being labeled “compostable” at all as of next summer, since they aren’t recognized as allowed inputs under the USDA’s National Organic Program. That’s left compostable packaging producers in limbo, and many are relabeling products “compostable except in California,” adding to consumer confusion.

Two bills that would have compounded the stalled status of compostables even more, AB 1812 and SB 1031, both failed to advance this legislative session. CAA is now pursuing a Unique Challenge Exemption — a request that would let compostable materials phase in gradually rather than comply all at once. Where things go from here depends on two open questions: whether CalRecycle extends its June 2027 compliance deadline with AB 1201, and/or whether USDA changes the federal definition first. Until one of those resolves, brands should proceed carefully before making compostable packaging their next move in California.

Atlantic Packaging Can Help You Navigate What’s Next

With this much litigation in motion across multiple states, staying compliant while avoiding costly missteps takes real attention. We’re not able to offer legal advice, but our team is always happy to be a sounding board, helping you think through how packaging design choices affect your exposure to eco-modulated fees. Reach out to your Atlantic sales representative to find out more!

Ready to dive deeper?