By: Jacqueline Chan and Vanessa Fulton
Consumers are increasingly demanding environmentally-friendly products and packaging. Driven by this increased demand and desire to create positive environmental change, companies are working hard to shift to more sustainable materials and packaging and seeking to communicate such efforts to consumers through product labels and advertising.
“Recyclable.” “Biodegradable.” “Made of 100% recycled content.” These are claims commonly seen in the marketplace today, but what do they actually mean to consumers? The Federal Trade Commission (FTC) has long viewed environmental benefit claims as an area with a high potential for consumer deception.[1] Such claims are similarly vulnerable to consumer lawsuits and competitor challenges. As evidenced by a recent lawsuit, companies would be well advised to carefully examine environmental benefit claims to make sure they are supportable and do not overstate the environmental benefit of their products or packaging.
On February 26, 2020, a nonprofit environmental group, the Earth Island Institute, filed a lawsuit in California state court challenging claims regarding the recyclability of plastic packaging made by ten major food, beverage, and consumer products companies.[2] The complaint alleges that such claims are false and misleading because the plastics used are largely not recycled or recyclable and the use of such plastic packaging results in global and localized harm related to marine plastic pollution. The Earth Island case is reportedly the first of its kind to tie allegations related to “recyclable” claims to marine plastic pollution.
To support its allegations of false and misleading claims, the complaint largely argues that much of the plastic that defendants label as “recyclable” is not actually recycled by consumers. According to plaintiff, this is due to several factors including:
- Many consumers are unable to access facilities that will actually recycle these products, particularly for plastic resins #3-7.
- Products using plastic resins #3-7, even if collected by municipal recycling programs, are not actually recycled due to the “negligible-to-negative” value and are sent to landfills or incinerated.
- For products using plastic resins #1 and #2, although recyclable, recycling facilities in the United States cannot process the volume of plastic containers submitted to recycling facilities each year.
- There is a decreasing market to actually use recycled plastic, as it is cheaper to use “virgin plastic,” which plaintiff alleges that defendants themselves use as opposed to using recycled plastic.
Plaintiff further contends that each defendant misleadingly uses unqualified “Mobius loop” symbols (the three-chasing arrows symbol or the universal recycle symbol). Specifically, plaintiff argues that, in many cases, the universal recycle symbol indicates only the type of plastic resin used in the container. However, plaintiff found that surveyed consumers largely believed the symbol meant the container was wholly recyclable. According to plaintiff, many consumers also believed that the universal recycle symbol indicates that the container is itself composed of recycled material. The complaint argues that defendants are aware of this consumer perception and use this symbol to “gain consumer loyalty” by misleading consumers into believing the products are recyclable when they are not.
Finally, plaintiff alleges that defendants purposefully take advantage of consumers’ environmental concerns when advertising, marketing, and selling products packaged in plastic as “recyclable,” when, according to plaintiff, they are not. Among other requested relief, plaintiff is asking the court to require defendants to refrain from marketing and promoting the challenged products as “recyclable” when they are not “recyclable” according to the FTC’s Green Guides and to issue corrective advertising for existing “recyclable” claims.
Key Takeaways
Although this lawsuit focused on recyclable claims related to plastic packaging, the same considerations apply to other forms of packaging and to environmental benefit claims more broadly. Many companies are working hard to drive forward positive environmental change and this lawsuit should not dissuade companies from continuing down this path. Instead, it should serve as a reminder to carefully and critically evaluate environmental benefit claims. What does this claim convey to a consumer? Is the claim realistically and reasonably supported? This lawsuit speaks to the importance of not overpromising recyclability or recycled content of packaging and, where necessary, appropriately qualifying recyclability claims for clarity.
Our firm regularly works with clients in evaluating risks
related to environmental benefit claims and providing guidance on
substantiating and qualifying such claims.
We will continue to monitor this case and similar third-party challenges
related to recyclability, sustainability, and other environmental claims. Please contact our firm if you have any
questions or would like to discuss your company’s claims on this topic.
[1] The FTC issued “Green Guides” designed to help marketers avoid making environmental claims that mislead consumers.
[2] Earth Island Institute v. Crystal Geyser Water Co. et al., Case No: 20CIV1213 (Cal. Super. Ct., San Mateo Cnty.). The lawsuit also names unnamed “Does” as defendants, leaving open the possibility of naming additional defendants.