California Extended Producer Responsibility Regulations Challenged In Court

On June 2, 2026, the Natural Resources Defense Council, Inc. (NRDC), Californians Against Waste Foundation (CAWF), and Oceana, Inc. (Petitioners) filed suit against the California Department of Resources Recycling and Recovery (CalRecycle) challenging the final regulations promulgated under Senate Bill 54 (SB 54). Petitioners’ Complaint asserts two arguments that the final regulations are not valid due to substantive deficiencies and makes policy arguments that the regulations are not sufficiently protective of the environment.

SB 54 Background

SB 54, or the Plastic Pollution Prevention and Packaging Producer Responsibility Act, was passed on June 30, 2022. The Act calls for the creation of an extended producer responsibility (EPR) program in the state. The program has been largely set up and partially implemented over the last several years, with an effective program date of June 1, 2026. Final regulations under the Act were approved on May 1, 2026.

The Act directs CalRecycle to take specific actions pertaining to the EPR program and provides structure for the program itself. SB 54 is robust and contains many directives, including:

• Producers of plastic products and packaging covered under the program must ensure those products are recyclable or compostable by 2032;

• Producers of materials covered under the program must meet recycling rates specified by the state; and

• Instructions that CalReycle promulgate regulations to ensure the Act requirements and policy goals are met, including a policy goal to ensure that 75 percent or more of materials within the EPR program scope are “source reduced, recycled, or composted by the year 2020, and annually thereafter.”

Complaint

First Cause of Action

Petitioners first allege that the final regulations are inconsistent with SB 54.

• Paragraph 79 of the Complaint alleges that the final regulations include a federal definition of “hazardous waste” that is inconsistent with the term as used under the Act and other California state law.

• Petitioners also claim that provisions in the final regulations discussing conflicts with federal law are inconsistent.

Second Cause of Action

Petitioners’ second allegation claims that the final regulations are arbitrary, capricious, or without reasonable or rational basis.

• The Complaint alleges that previous versions of the regulations excluded chemical recycling technologies as an eligible form of recycling given their “well-known, harmful characteristics” of the technologies, but that the approach in the final regulations does not explicitly exclude these technologies. Petitioners argue that CalRecycle did not provide an explanation nor include documentation in the administrative record explaining this change.

• Petitioners argue that CalRecycle did not provide a reasonable explanation as to the use of a federal definition of hazardous waste, or incorporation of technical standards into the final regulations.

• Petitioners argue that CalRecycle did not provide a reasonable explanation underlying the decision to define or scope an Act requirement for “viable” responsible end markets.

• Petitioners argue that CalRecycle did not sufficiently elaborate or explain its decision regarding an Act requirement that certain materials including toxic materials be subject to an increased fee.

• Petitioners lastly argue that the regulatory provisions describing conflicts with federal law are without reasonable basis.

Policy Rationales

The Complaint raises policy issues and frames the Complaint from an environmental protection perspective. In providing background on SB 54, the Complaint raises legislative findings, such as environmental justice concerns associated with plastic pollution. Petitioners focus on elements of SB 54 that seek to minimize waste, environmental impacts, and public health impacts.

NRDC’s press release regarding the lawsuit explains that “[w]e need strong rules that are true to SB 54, reduce plastic waste, and prevent greenwashing.” The press release quotes CAWF Director Nick Lapis, who explains that the regulations do not reflect the law that was passed, and that Californians deserve stronger protections.

Commentary

This lawsuit comes on the heels of a similar lawsuit challenging Oregon’s EPR program, and a lawsuit challenging SB 343, California’s recyclability labeling law. Challenges against EPR programs and state programs that target plastic products and packaging are not unexpected. This is a dynamic regulatory space that has seen a swift increase in state EPR programs and state interest in regulating plastics, generally.

EPR programs, in particular, are in their relative infancy in the United States (more longstanding, robust programs exist in the European Union), especially for programs related to plastics and packaging. Oregon, California, and other states have enacted laws to set up programs that are run and overseen by third parties, leaving producers little room for redress and complicating advocacy efforts. Questions about supply chain issues, producers’ rights, constitutionality of the programs, and more practical and legal implications have been raised for nearly all existing EPR programs at the state level.

Legal challenges are one of the handful of tools producers have to address questions and concerns about aspects of the programs that are unclear, unfair, non-transparent, unreasonable, or otherwise impractical from a compliance standpoint. If successful, these challenges may lead to changes in future iterations of programs and may result in new state programs that account for the challenges associated with existing programs.

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