On July 30, 2025, the National Association of Wholesaler-Distributors (NAW) filed suit against the Oregon Department of Environmental Quality and the Oregon Environmental Commission alleging that Oregon’s Plastic Pollution and Recycling Modernization Act (RMA) is unconstitutional.
The RMA creates an Extended Producer Responsibility (EPR) program requiring producers, wholesalers, and distributors of packaging materials to join a private Producer Responsibility Organization (PRO), currently the sole-approved Circular Action Alliance (CAA). This organization sets mandatory fees on packaging sold into the state using a confidential, non-transparent methodology, which can lead to unpredictable and burdensome costs—particularly for small and mid-sized businesses. NAW is claiming that the law unfairly burdens them with excessive fees and compliance requirements, often despite limited control over packaging decisions, and denies them meaningful input or legal protections. The lawsuit identifies the following concerns:
- Producers must join CAA or face prohibitive costs to form an alternative PRO, creating a regulatory monopoly.
- Fees are set through a confidential process without public input or sufficient regulatory oversight.
- Mid-sized businesses, often categorized as producers despite limited packaging control, face significant compliance burdens and lack meaningful influence over fee-setting.
- Binding arbitration clauses and lack of judicial recourse limit producers’ ability to challenge fees or decisions.
Key Claims Raised in the Lawsuit:
- Excessive Delegation: The RMA unlawfully grants broad regulatory power to a private entity (CAA) without clear objective legislative standards or adequate procedural safeguards.
- Interstate Commerce Impact: The RMA discriminates against out-of-state producers by imposing disproportionate compliance costs and imposes burdens that disrupt national commerce, violating the Dormant Commerce Clause.
- Unconstitutional Contract Conditions: Producers must accept binding contracts with CAA that restrict their rights and limit their ability to challenge fees.
- Due Process Concerns: The law lacks fair procedures for producers to contest fee assessments, requiring binding arbitration and preventing judicial review.
The complaint alleges that the RMA imposes a non-transparent, monopolistic regulatory environment that shifts significant compliance costs and risks onto producers—especially mid-sized companies—with little opportunity for input or legal recourse. The lawsuit seeks to overturn the law and halt enforcement, citing violations of both federal and state constitutional protections.
