The National Association of Wholesaler-Distributors (“NAW”) has appealed to the U.S. Court of Appeals for the Ninth Circuit, asking it to overturn a district court ruling that upheld Oregon’s Plastic Pollution and Recycling Modernization Act, the state’s extended producer responsibility (“EPR”) law for packaging.[1] The Oregon ruling was the first substantive decision issued in the pending challenges to state EPR laws across the country.[2]

Oregon

Oregon’s EPR law, which passed in 2021 and launched July 1, 2025, was the first active packaging EPR program in the country and is designed to shift the end-of-life costs of a product’s packaging onto its producer. The EPR law addresses packaging, printing and writing paper, and food serviceware. Unless an exemption applies, the law requires producers of these covered products to join a producer responsibility organization (“PRO”), collect detailed packaging and paper data, submit annual reports, and pay fees based on the volume and type of materials supplied. Oregon assigns "producer" status through a statutory hierarchy that generally places responsibility on the brand owner, trademark licensee, importer, manufacturer, or first seller of a covered product sold or distributed in Oregon.[3] The PRO here, the Circular Action Alliance (“CAA”), works with Oregon DEQ to assess fees on producers to help cover the cost of their materials to the state’s recycling system and to fund improvements that modernize and expand recycling, with each producer’s share tied roughly to its portion of these recycling costs. CAA also serves as the PRO for other states with active EPR laws, including California, Colorado, Maryland, Minnesota, and Washington.

NAW filed suit in Oregon on July 30, 2025, shortly after Oregon’s EPR obligations and associated reporting requirements took effect. On February 6, 2026, the court granted NAW a preliminary injunction barring enforcement of the law against NAW and its members only. Before trial, the court dismissed several of NAW’s claims, leaving only the Due Process Clause and Dormant Commerce Clause challenges for resolution at a five-day bench trial in July 2026. NAW argued the law violates both the Dormant Commerce Clause and the Due Process Clause by targeting out-of-state producers and delegating substantial regulatory authority to the CAA, a private PRO. In a 71-page ruling, the court rejected those claims, concluding that the law is not discriminatory and applies evenhandedly to in-state and out-of-state producers alike and that Oregon DEQ retained sufficient oversight and control over the CAA’s activities to defeat NAW’s constitutional challenges.

A related Oregon case remains closely tied to the outcome of NAW’s lawsuit. Earlier this summer, Lollicup USA filed a class action against Oregon DEQ Director Leah Feldon in the U.S. District Court for the District of Oregon asserting the same Dormant Commerce Clause and Due Process Clause challenges on behalf of producers not covered by NAW’s preliminary injunction.[4] In a September filing, both Lollicup and Director Feldon indicated that they are awaiting a decision on whether NAW will appeal before determining their next steps, including whether Lollicup will seek a preliminary injunction or whether Director Feldon will answer the complaint or move to dismiss the case.[5] The parties are scheduled to file a joint status report by October 16.[6]

The Oregon decision and subsequent appeal lands amid parallel litigation testing similar EPR laws in other states.

California

NAW and a 17-state coalition recently challenged California’s EPR packaging law, the Plastic Pollution Prevention and Packaging Producer Responsibility Act, known as SB 54.[7] In August, plaintiffs filed a motion for a preliminary injunction asking the court to block enforcement of SB 54 while their constitutional challenge proceeds. A hearing on NAW’s motion for preliminary injunction is scheduled for January 15, 2027.[8]

Plaintiffs also amended their complaint to add a Due Process Clause challenge, contending that SB 54’s definitions are unconstitutionally vague and the law imposes sweeping obligations without telling businesses how to meet them.[9] Both of plaintiffs’ filings rely on a recent order preliminarily enjoining enforcement of California’s SB 343 “chasing arrows” recycling-labeling law, in which the Court found that plaintiffs were likely to succeed on their unconstitutional-vagueness and First Amendment free-speech claims.[10]

Colorado

NAW also filed a federal lawsuit at the end of July 2026, challenging Colorado’s EPR packaging law, the Producer Responsibility Program for Statewide Recycling Act.[11] NAW claims the program violates the First Amendment by compelling businesses to join and pay dues to CAA and violates due process by prohibiting businesses from challenging CAA’s fee assessments in court. NAW has also moved for a preliminary injunction, which remains pending. A separate challenge to Colorado’s program was brought earlier by the Independent Lubricant Manufacturers Association, which likewise seeks preliminary injunctive relief and is awaiting a decision from the court.[12]

Conclusion

Taken together, these cases reflect a broader tension as EPR laws gain traction. States are moving quickly to shift the costs of recycling onto producers, while states and trade associations are challenging the constitutionality of these laws in court. The Oregon district court ruling suggests courts may be receptive to states’ authority to enact these EPR programs, but NAW’s Ninth Circuit appeal, along with the pending litigation in other states, means the legal framework remains unsettled.

What this means for producers. Companies that manufacture, sell, or distribute packaging and covered paper products that qualify as a “producer” under state law should continue preparing for compliance obligations in Oregon and other states with active EPR programs, notwithstanding the appeal and ongoing litigation in other states. Notably, the California or Colorado challenges do not suspend their respective state EPR laws unless their courts grant the preliminary injunctions. Producer registration, reporting obligations, and CAA’s implementation process remain in effect.

Affected companies should actively monitor these cases, as they could influence compliance timelines and litigation in other states.

Nelson Mullins’ environmental attorneys are monitoring EPR developments across states and are available to help clients assess applicability, registration, reporting, and fee obligations, evaluate litigation risk, and develop compliance strategies as this area of law continues to evolve.

[1] Plaintiff’s Notice of Appeal, Nat’l Ass’n of Wholesaler-Distribs. v. Feldon, No. 3:25-cv-01334 (D. Or. Sept. 24, 2026).

[2] Findings of Fact and Conclusions of Law, Nat’l Ass’n of Wholesaler-Distribs. v. Feldon, No. 3:25-cv-01334 (D. Or. Aug. 27, 2026).

[3] See Or. Rev. Stat. § 459A.866.

[4] Complaint, Lollicup USA, Inc. v. Feldon, No. 3:26-cv-01287-SI (D. Or. June 25, 2026).

[5] Joint Motion for Extension of Time, Lollicup USA, Inc. v. Feldon, No. 3:26-cv-01287-SI (D. Or. Sept. 9, 2026).

[6] Order Granting Joint Motion for Extension of Time, Lollicup USA, Inc. v. Feldon, No. 3:26-cv-01287-SI (D. Or. Sept. 10, 2026).

[7] Complaint, State of Neb. v. Heller, No. 2:26-cv-2214 (E.D. Cal. June 22, 2026).

[8] Motion for Preliminary Injunction, State of Neb. v. Heller, No. 2:26-cv-2214 (E.D. Cal. Aug. 19, 2026).

[9] Amended Complaint, State of Neb. v. Heller, No. 2:26-cv-2214 (E.D. Cal. Aug. 19, 2026).

[10] Cal. League of Food Producers v. Bonta, No. 3:26-cv-01675, 2026 WL 2055589 (S.D. Cal. July 14, 2026).

[11] Complaint, Nat’l Ass’n of Wholesaler-Distribs. v. Ryan, No. 1:26-cv-03460-NRN (D. Colo. July 30, 2026).

[12] Complaint, Indep. Lubricant Mfrs. Ass’n v. Colo. Dep't Pub. Health and Env't, No. 2026-cv-30902 (Denver Cnty. Dist. Ct. (Colo.) Mar. 12, 2026).