Earth Day’s theme this year—Our Power, Our Planet—asks us to consider where environmental power resides and how it is exercised. Oregon’s Plastic Pollution and Recycling Modernization Act is an example of that question in action. Enacted in 2021, the Act represents an assertion of state environmental authority in a space that the federal government has not yet regulated—extended producer responsibility (“EPR”) for consumer packaging and related products.
But on February 6, 2026, the United States District Court for the District of Oregon issued a preliminary injunction temporarily enjoining the Oregon Department of Environmental Quality (“DEQ”) from enforcing the law against Plaintiff National Association of Wholesaler-Distributors (“NAW”) and its members. National Association of Wholesaler-Distributors v. Feldon, No. 3:25-cv-1334 (D. Or. Feb. 6, 2026). The decision is the first time a federal court has temporarily halted enforcement of a state packaging EPR program on constitutional grounds, and with six other states operating or implementing similar programs, the case’s implications may extend well beyond Oregon.
Oregon’s Plastic Pollution and Recycling Modernization Act
Oregon’s Plastic Pollution and Recycling Modernization Act was enacted in 2021 and requires producers of packaging, printing and writing paper, and food serviceware to join and pay annual membership fees to a Producer Responsibility Organization (“PRO”). ORS §§ 459A.863(6)(a), 459A.869(1)–(2). The Act defines “producers” broadly to include brand owners, manufacturers, wholesalers, distributors, and importers who sell or introduce covered products into Oregon, with only the smallest producers exempt. Id. §§ 459A.863(22), 459A.866, 459A.872(1).
The PRO must administer a DEQ-approved program providing for the collection, recycling, and responsible management of covered products and incentivize members to reduce the environmental and human health impacts of those products. See id. § 459A.875. That incentive operates primarily through the fee structure: the Act requires fees to be set on an eco-modulated basis, meaning producers of more recyclable or lower-impact materials pay lower fees, while producers of non-recyclable or higher-impact materials pay higher fees, creating a financial incentive to redesign their products. Id. § 459A.884(3)–(4). To calculate fees, producers are required to annually report the weight and type of covered materials they sell or distribute into Oregon. OR. Admin. R. § 340-090-0700(1)(d), (4)(b).
Oregon has approved only one PRO—the Circular Action Alliance (“CAA”), a private non-profit entity—and the program launched on July 1, 2025. CAA sets and assesses fees across material categories pursuant to a program plan approved by DEQ. However, the detailed fee-setting methodology underlying those fees has been designated confidential and is not publicly available. Producers who dispute their assessments have no access to judicial review—binding arbitration with CAA is the sole recourse.
The Constitutional Challenge
On July 30, 2025, NAW filed suit challenging the Act as both facially unconstitutional and as-applied to its members. The complaint alleges that the Act violates the Dormant Commerce Clause, the Unconstitutional Conditions Doctrine, the Due Process Clause, the Equal Protection Clause, and Oregon’s Nondelegation Doctrine. In its February 6, 2026 order, the court dismissed without prejudice the claims under the Oregon Constitution—including the nondelegation claim—as well as the Unconstitutional Conditions and Equal Protection claims, leaving the Commerce Clause and Due Process claims to proceed to trial, scheduled to begin July 13, 2026.
Commerce Clause
On the Commerce Clause, the complaint alleges the program discriminates against out-of-state producers by imposing disproportionate compliance costs on businesses operating national and regional supply chains, unduly burdens interstate commerce by subjecting producers to complex, non-reviewable fees tied to state-specific PRO determinations, and has impermissible extraterritorial effects by requiring out-of-state producers to conform their packaging decisions to standards set by CAA—including for products ultimately destined for other states.
Due Process
On due process, the complaint alleges that producers are subject to binding fee obligations with no visibility into how those fees are calculated, no meaningful opportunity to challenge fee determinations, and no access to judicial review—with binding arbitration as the sole recourse. NAW argues that the substantial private interest in market access and freedom from arbitrary fees outweighs Oregon’s interest in efficient program administration under the Mathews v. Eldridge balancing test.
What’s at Stake—For the Planet and the Law
Oregon is one of seven states—California, Colorado, Maryland, Maine, Minnesota, Oregon, and Washington—with EPR laws targeting packaging and related products, all sharing the same basic structural architecture as Oregon’s with some variations in whether PRO membership is mandated and whether multiple PROs are permitted. While the preliminary injunction applies only to NAW members and does not directly affect other states’ programs, the constitutional theories at issue go to the core architecture of EPR regulation and could have implications for how those programs are structured and enforced nationwide. Notably, CAA serves as the designated PRO in four other states—California, Colorado, Minnesota, and Maryland—meaning that a ruling on the constitutional adequacy of CAA’s fee-setting procedures could have direct implications for those programs as well.
The litigation also raises a broader question that extends beyond the EPR context: what procedural protections does the Due Process Clause require when state legislation vests binding administrative authority—such as the power to assess fees—in private entities rather than through traditional government processes? The appeal of such delegations is understandable: private entities can bring technical expertise that state agencies may lack, and delegating program administration may reduce state costs. But these same features may create constitutional vulnerability. The outcome of the Oregon litigation will have practical implications for how legislators can structure such delegations as they continue to exercise their environmental authority—ambitiously, but within their borders and within constitutional limits.
Conclusion
This Earth Day, the Oregon litigation serves as a timely reminder that state environmental authority—however well-intentioned—must operate within constitutional limits, including limits on how far states may reach in regulating commerce that crosses their borders and on the procedural protections that must accompany binding financial obligations imposed on regulated parties. The law itself advances the vision of waste reduction and a more circular economy, while the constitutional challenge illustrates the legal complexity that can accompany ambitious state environmental action.
The litigation will be watched closely by producers, regulators, and environmental advocates alike—and may shape the trajectory of state environmental regulation well beyond the world of packaging and waste.