The Recycling Reckoning: Oregon’s EPR Law Hits a Federal Roadblock—and the Rest of the Country Is Taking Notes

A federal court in Oregon has done something no U.S. court has done before: paused enforcement of a state extended producer responsibility (EPR) law on constitutional grounds—though notably, the pause applies only to members of the National Association of Wholesaler-Distributors, not to all producers subject to the law. 

The ruling, issued in February 2026 in National Association of Wholesaler-Distributors v. Feldon, has sent ripples across the EPR landscape at a moment when six other states have enacted similar programs, and more are considering them. At its core, the case raises fundamental questions about whether state-by-state EPR regimes—which impose compliance obligations on producers of packaging, food service ware, and paper products—can survive scrutiny under the U.S. Constitution’s Commerce Clause and due process protections. With a trial set for July 2026, this is a case that producers, distributors, and policymakers across the country should be watching closely. 

Extended Producer Responsibility Laws

EPR laws have emerged across seven U.S. states as a mechanism to shift the cost burden of collecting, sorting, recycling, and disposing of packaging, paper goods, and food service ware away from local governments and taxpayers and onto the producers of those materials. Enacted in 2021, Oregon’s Plastic Pollution and Recycling Modernization Act (the RMA) was one of the first comprehensive EPR programs in the United States, taking effect on July 1, 2025.

What the RMA Requires

The RMA applies to a broad range of covered products, including packaging (plus storage items, service packaging, and shipping materials), food service ware, and printing and writing paper.

Under the law, covered “producers” are determined according to a statutory hierarchy that generally begins with the brand owner but can extend to licensees, importers, or the first distributor of a product into the state depending on the product type. All covered producers are required to join a state-approved Producer Responsibility Organization (PRO) and pay associated fees to finance statewide recycling system improvements. Producers with less than $5 million in gross revenue or less than one ton of covered materials per year are exempt.

A particularly contentious feature of Oregon’s program is that only one PRO—the Circular Action Alliance (CAA)—applied for and received state approval. As a result, producers subject to the RMA must join the CAA and accept its terms or exit the Oregon market entirely.

The National Association of Wholesaler-Distributors (NAW) has characterized the arrangement as a “captive compliance environment” with little competition or oversight. NAW’s central objection is that the law imposes unreasonable and disproportionate burdens on distributors and wholesalers, which are classified as “producers” under the RMA despite having little or no ability to control the design, composition, or recyclability of the products they handle. 

Other Trade Associations Failed To Intervene

Attempts by other trade groups to intervene in the NAW lawsuit have been unsuccessful. On April 1, 2026, the court denied motions to intervene by the American Forest and Paper Association (AF&PA) and a group of retail associations comprising Oregon Business and Industry (OBI), the Northwest Grocery Association, and Food Northwest. The court denied permissive intervention for all intervenors on the basis that the motions were not timely filed and would unfairly prejudice the Oregon defendants due to the expedited July 2026 trial date. The court also found that AF&PA did not meet the requirements for intervention as of right since it had other means to protect its interests and its motion was untimely.

These failed attempts reflect broad concerns about EPR programs across various industries. AF&PA’s intervention reflects the paper industry’s growing concern that EPR programs like Oregon’s fail to account for materials—such as paper and paper packaging—that already have well-established, high-performing recycling systems in place. The OBI-led intervention signifies how many businesses that play a critical role in the supply of goods nationwide and in Oregon have been heavily affected by these laws.

The Lawsuit and Court Rulings

In July 2025, NAW filed suit in the U.S. District Court for the District of Oregon, asserting five constitutional challenges:

• Violation of the Dormant Commerce Clause
• Violation of the Due Process Clause
• Violation of the Equal Protection Clause
• Unconstitutional conditions
• A state-law nondelegation challenge

Oregon responded with a motion to dismiss. On February 6, 2026, following a hearing on both motions, the court issued two significant rulings:

• Claims dismissed without prejudice. The equal protection, unconstitutional conditions, and Oregon constitutional claims were dismissed.
• Preliminary injunction granted. The court halted enforcement of the RMA against NAW and its members pending a five-day trial scheduled to begin on July 13, 2026.

The court allowed NAW’s dormant Commerce Clause and Due Process Clause claims to proceed, finding they raised serious questions on the merits and that the balance of hardships tipped sharply in NAW’s favor. 

Constitutional Arguments for Trial

Due Process Clause

NAW’s due process claim challenges the opacity and nonnegotiability of the CAA’s confidential fee structure and the absence of meaningful public regulatory oversight over those fees. During the preliminary injunction hearing, the court appeared to be particularly concerned with the due process implications associated with (1) the confidential fee structure that makes it difficult for producers to verify their fees and (2) NAW’s argument that some large-scale producers are operating CAA, potentially at the expense of nonmember producers.

Dormant Commerce Clause

NAW claims that the RMA violates the Dormant Commerce Clause on the basis that the law imposes substantial burdens on the nationwide packaging and distribution system. NAW claims that out-of-state distributors have disproportionate compliance burdens associated with tracking the sale of items into Oregon that may not even be sold in Oregon. The Dormant Commerce Clause claim was not discussed in depth during the preliminary injunction hearing. 

Key Limitations and Next Steps

This preliminary injunction is the first time a U.S. federal court has paused enforcement of an EPR statute on constitutional grounds. However, several important limitations apply:

• This is not a final ruling on the merits—the court applied the relatively permissive standard of “serious questions” rather than a likelihood of ultimate success. This case will be decided after a five-day trial starting on July 13, 2026.
• Following the recent U.S. Supreme Court decision in Trump v. CASA, Inc. (2025), the injunction applies only to NAW and its members—Oregon remains free to enforce the RMA against nonparty producers in the interim.

Broader Implications

The implications of this case extend well beyond Oregon. Six other states—including California, Minnesota, Maine, Colorado, Maryland, and Washington—have enacted similar EPR packaging frameworks, and many more are actively considering legislation. California’s program in particular is in active implementation, with regulations expected to be finalized by May. 

There is also a similar challenge to Colorado’s EPR law underway. On March 12, 2026, the Independent Lubricant Manufacturers Association filed a complaint in Denver District Court against the Colorado Department of Public Health and Environment (CDPHE), alleging that CDPHE unlawfully created a second PRO by approving an individual program plan submitted by the Lubricants Packaging Management Association. The complaint also includes constitutional challenges to the program similar to those raised in NAW’s Oregon complaint, such as due process and nondelegation doctrine claims. The complaint also raises a First Amendment claim against a statutory ban on disclosing EPR compliance costs to consumers.

Producers have grown increasingly anxious about navigating inconsistent, state-by-state compliance obligations, particularly as enforcement deadlines arrive even while constitutional litigation is still underway. As this area of law continues to evolve rapidly, we will continue to monitor developments and are happy to discuss the implications for your business.