NAW Requests 9th Circuit to Suspend Enforcement of EPR Law

Note: This article is based on publicly available information from court filings, Oregon regulatory materials, the National Association of Wholesaler-Distributors, Circular Action Alliance, and U.S. legal and waste-industry reporting available as of June 19, 2026.

Why Oregon’s EPR Fight Has Everyone in the Packaging Aisle Suddenly Reading Court Orders

Extended producer responsibility may sound like the name of a corporate yoga class, but in Oregon it has become one of the most important legal battles in U.S. recycling policy. The National Association of Wholesaler-Distributors, commonly known as NAW, has challenged Oregon’s Plastic Pollution and Recycling Modernization Act, arguing that the state’s extended producer responsibility law places unconstitutional burdens on distributors and delegates too much regulatory power to a private organization.

The requested headline says NAW asked the 9th Circuit to suspend enforcement of the EPR law. More precisely, the lawsuit was filed in the U.S. District Court for the District of Oregon, a federal court within the Ninth Circuit. The court granted a preliminary injunction on February 6, 2026, temporarily preventing Oregon’s Department of Environmental Quality from enforcing the law against NAW and its members while the case proceeds. That may sound like legal housekeeping, but for companies moving packaged goods across state lines, it is a very large broom.

At the center of the dispute is a practical question with national consequences: who should pay for recycling systems, and how far can a state go when it makes private companies fund them? Oregon says its law modernizes recycling, improves accountability, and shifts costs away from local governments and households. NAW argues that the law sweeps in wholesalers and distributors that often do not design, manufacture, or control packaging, yet may still face registration, reporting, fees, contracts, arbitration rules, and penalties.

What Is an EPR Law?

Extended producer responsibility, or EPR, is a policy model that makes producers financially or operationally responsible for products and packaging after consumers are done with them. Instead of relying mostly on taxpayers, city recycling programs, and ratepayers, EPR laws require covered companies to help pay for collection, sorting, processing, recycling education, market development, and related system improvements.

In theory, EPR creates a cleaner incentive. If a company must pay more for hard-to-recycle packaging, it may redesign that packaging to be lighter, simpler, reusable, or more recyclable. In practice, the details get messy faster than a toddler with a yogurt pouch. The law has to define who counts as a “producer,” what materials are covered, how fees are calculated, who collects the money, how the money is spent, and what happens when a company disagrees with the bill.

Oregon’s Recycling Modernization Act

Oregon’s Plastic Pollution and Recycling Modernization Act, often called the Recycling Modernization Act or RMA, was enacted through Senate Bill 582. The law became effective in 2022, with major program obligations launching in 2025. It covers packaging, printing and writing paper, and food serviceware sold or distributed into Oregon. Producers generally must participate in a producer responsibility organization, report covered materials, and pay fees that help fund the recycling system.

Oregon’s approved producer responsibility organization is Circular Action Alliance, or CAA. CAA administers key parts of the program, including producer registration, data collection, fee assessment, and funding flows. Supporters see this structure as a way to build expertise and coordinate a complicated statewide recycling overhaul. Critics see a private organization holding too much practical power over regulated businesses. That tension is the legal spark behind NAW’s challenge.

Why NAW Challenged the Oregon EPR Law

NAW represents wholesaler-distributors across many lines of trade. These companies are the middle of the supply chain: they move goods from manufacturers to retailers, institutions, contractors, restaurants, offices, schools, and other customers. They may handle packaged products every day, but they often do not choose the packaging. A distributor may ship a product in a manufacturer’s box, with a manufacturer’s label, using packaging designed long before the distributor ever sees it.

That is why NAW argues Oregon’s definition of responsibility is too broad. If a wholesaler simply brings goods into Oregon, should it be treated like the company that designed the packaging? Oregon’s framework can assign obligations based on who sells, distributes, or offers covered products into the state when other responsible parties are unavailable or when the statutory hierarchy points to that entity. NAW says that structure can place heavy burdens on distributors that have little practical control over packaging choices.

The Dormant Commerce Clause Argument

One of NAW’s central claims is based on the Dormant Commerce Clause, a constitutional doctrine that limits states from unduly burdening interstate commerce. NAW argues that Oregon’s program affects national supply chains, not just Oregon transactions. Packaged goods do not politely stop at the state border, put on an Oregon hat, and become magically traceable. Many products move through warehouses, distribution hubs, and customer networks spanning multiple states.

NAW contends that requiring distributors to track, report, and pay based on Oregon-specific packaging flows can create disproportionate compliance burdens. A company operating nationally may have to build systems to identify what packaging ultimately enters Oregon, even when goods are shipped through complex channels. The association also argues that fees and compliance obligations may distort competition, especially when out-of-state distributors face costs that purely local businesses may avoid or experience differently.

The Due Process Argument

NAW also raises due process concerns. The lawsuit questions whether Oregon has delegated too much regulatory authority to CAA, a private organization. According to NAW, CAA’s fee-setting role, confidential methodology, producer agreements, and dispute-resolution procedures make the system opaque and difficult to challenge. Businesses do not generally enjoy receiving invoices calculated by a method they cannot fully inspect. That is not recycling policy; that is “trust us, bro” with a payment deadline.

The due process concern is not simply that fees exist. Fees are common in regulatory programs. The deeper issue is whether regulated parties have enough notice, transparency, oversight, and meaningful opportunity to contest obligations. If a private organization effectively determines what a company owes and the state enforces consequences for nonpayment, courts may ask whether constitutional safeguards are strong enough.

What the Court Did in February 2026

On February 6, 2026, the U.S. District Court for the District of Oregon granted NAW a preliminary injunction. The order barred Oregon’s DEQ director from enforcing the Plastic Pollution and Recycling Modernization Act against NAW and its members while the case proceeds. The court found that serious questions went to the merits of NAW’s claims, that NAW members faced likely irreparable injury, and that the balance of hardships tipped sharply in NAW’s favor.

That does not mean NAW has won the whole case. A preliminary injunction is not a final ruling. It is a temporary pause designed to prevent harm while the court considers the merits. Think of it as the legal equivalent of pressing the giant red “hold on a second” button. It gives NAW members relief from enforcement for now, but it does not automatically erase Oregon’s law or decide whether the EPR system is constitutional.

The Injunction Is Narrow

The most important practical detail is scope. The injunction applies to NAW and its members. It does not suspend Oregon’s EPR law for every company. Non-NAW producers may still need to register, report, pay fees, and comply with CAA and DEQ requirements unless they have their own legal relief or Oregon changes its enforcement position.

This narrow scope creates an awkward compliance split. One distributor may be protected because it is an NAW member. A competitor with similar operations may remain fully subject to the law. That uneven landscape is one reason the case has attracted attention from trade groups, packaging companies, retailers, manufacturers, recyclers, and legal observers across the country.

Why Oregon Says the Law Matters

Oregon’s argument is rooted in a familiar problem: recycling systems are expensive, inconsistent, and often confusing. Local governments and ratepayers have historically carried much of the cost. Residents are told to recycle, then face different rules depending on where they live, what service provider they have, and whether the item in their hand is actually recyclable or merely wearing the costume of recyclability.

The Recycling Modernization Act aims to create a more uniform, accountable system. It is designed to fund recycling improvements, standardize collection lists, support responsible end markets, and require producers to participate in the costs created by packaging and paper products. Supporters argue that without producer funding, communities struggle to keep up with changing packaging streams, weak recycling markets, contamination, and infrastructure needs.

From Oregon’s perspective, the law is not a punishment for business. It is an attempt to make the economics of packaging waste less lopsided. If companies profit from selling goods in packaging, the state argues, those companies should help pay for what happens after the package is opened, flattened, rinsed, forgotten in the garage, and eventually placed in a bin with a heroic but uncertain future.

Why Businesses Are Worried

Business concerns fall into three broad categories: cost, control, and complexity. Cost is the obvious one. EPR fees can become significant, especially for companies handling large volumes of covered materials. Some distributors argue that the fees may exceed margins on certain products, making Oregon sales less viable. In low-margin wholesale distribution, a surprise invoice is not a rounding error; it can be the difference between serving a market and walking away.

Control is the second concern. Many wholesalers do not design packaging. They may not know the exact composition, weight, recyclability profile, or brand-level responsibility for every item moving through their systems. Asking them to report and pay as though they were packaging engineers can feel like asking the delivery driver to redesign the pizza box. Admirable ambition, wrong person.

Complexity is the third concern. Oregon is not alone. California, Colorado, Maine, Minnesota, Maryland, and Washington have moved toward packaging EPR frameworks or related recycling reforms. Each state has its own definitions, deadlines, exemptions, reporting requirements, and administrative structures. A national company may soon face a patchwork of obligations that requires legal review, data systems, supplier coordination, contract changes, and ongoing monitoring.

Why This Case Could Affect Other States

Oregon’s law is especially important because it is one of the first major packaging EPR programs to move from theory into real implementation. Other states are watching closely. If Oregon’s program survives, it may become a model for future EPR laws. If parts of it are struck down, lawmakers and regulators elsewhere may revise their programs to avoid similar constitutional challenges.

The case may influence how states define “producer,” how much power they give to a producer responsibility organization, whether fee methodologies must be public, how disputes are handled, and whether companies can challenge assessments in court. Even a narrow ruling could shape the architecture of EPR nationwide.

Transparency May Become the Key Word

The legal fight suggests that transparency will be central to the next generation of EPR programs. Companies may accept that recycling costs are rising and that producer funding is here to stay. What they are less likely to accept is a system where fee calculations are confidential, contracts are non-negotiable, and disputes are funneled into procedures they see as limited or one-sided.

For regulators, the lesson is also clear. If a state wants to use a private PRO to run a public-facing compliance system, it may need stronger guardrails. That could include clearer statutory standards, public fee formulas, agency review of assessments, multiple PRO options, accessible appeals, and stronger conflict-of-interest protections. In other words, if the recycling system is going to ask businesses for money, it should at least show its math. Nobody likes a mystery invoice, except maybe the person sending it.

What Companies Should Watch Next

The case is scheduled to proceed toward a trial on the merits. Companies should watch whether the court ultimately agrees with NAW’s Dormant Commerce Clause and due process arguments. They should also monitor whether Oregon amends regulations, changes enforcement practices, adjusts CAA oversight, or modifies fee transparency rules before a final decision.

Businesses selling packaged goods into Oregon should not assume the preliminary injunction protects them unless they fall within its scope. Non-NAW companies remain in a different position. They should review whether they are obligated producers, whether exemptions apply, whether supplier contracts allocate responsibility clearly, and whether their data systems can support state-specific reporting.

Practical Compliance Questions

Companies should ask several basic questions. Do we sell, distribute, import, or offer covered products in Oregon? Are we the brand owner, licensee, importer, distributor, retailer, or another party in the statutory responsibility chain? Do we have packaging data by material type and weight? Are supplier agreements clear about who handles EPR reporting and fees? Have we registered with the correct organization? Do invoices match our understanding of reported data? Do we have a process for challenging errors?

These questions are not glamorous, but neither is scrambling during an enforcement deadline. The companies best positioned for EPR compliance will be those that treat packaging data like financial data: organized, auditable, updated, and assigned to someone whose job title does not secretly mean “whatever nobody else wanted to do.”

Experience-Based Lessons From the NAW EPR Dispute

The NAW challenge offers several practical lessons for companies, policymakers, and anyone who enjoys watching environmental law collide with supply-chain reality. The first lesson is that compliance systems must be designed around how products actually move. A state may want clean data on packaging entering its borders, but distributors often operate in networks that were built for speed, availability, and cost efficiency, not state-by-state material accounting. If the law assumes perfect visibility, the law may be disappointed. Supply chains are not spreadsheets wearing sneakers.

The second lesson is that definitions matter more than slogans. “Producer pays” is simple. Defining the producer is not. In a modern supply chain, a product might involve a foreign manufacturer, a U.S. importer, a private-label brand, a wholesaler, a retailer, a marketplace, and a final customer. If responsibility is not assigned clearly, multiple parties may worry they are liable, or worse, each may assume someone else handled it. That is how compliance gaps are born, usually with a calendar reminder that says “oops.”

The third lesson is that transparency builds legitimacy. Businesses may complain about fees, but they complain much louder when they cannot understand them. A producer responsibility organization that collects money should be able to explain how fees are calculated, what data was used, how errors can be corrected, and how decisions can be challenged. Confidential business information can be protected without turning the whole program into a black box. When regulated parties understand the rules, they are more likely to comply and less likely to call their litigation counsel before breakfast.

The fourth lesson is that states need to think nationally even when legislating locally. Packaging markets are interstate by nature. A box of office supplies may be designed in one state, imported through another, stored in a regional warehouse, sold through a national contract, and delivered to Oregon as part of a broader account. If each state builds a different EPR system, companies will need flexible compliance infrastructure. Smaller businesses may struggle most because they lack dedicated legal, sustainability, and data teams. Good policy should improve recycling without accidentally creating a paperwork obstacle course where only the biggest companies can afford the entrance fee.

The fifth lesson is that environmental ambition and constitutional design must travel together. Oregon’s recycling goals are serious. The United States produces enormous amounts of packaging waste, and local recycling programs need stable funding and clearer rules. But even well-intentioned laws must respect constitutional limits, provide due process, and avoid unnecessary burdens on interstate commerce. A program can be green and still need guardrails. In fact, durable environmental policy usually needs more guardrails, not fewer, because it must survive lawsuits, elections, budget cycles, and the occasional spreadsheet-induced panic attack.

The sixth lesson is that businesses should not wait for final court rulings to prepare. Litigation can change obligations, but it rarely eliminates the need for data. Even if Oregon’s program is modified, EPR is expanding in the United States. Companies that build packaging inventories, supplier questionnaires, reporting workflows, and contract clauses now will be better prepared for California, Colorado, Minnesota, Maine, Maryland, Washington, and future states. Waiting until every lawsuit is finished is like waiting until every road is pothole-free before buying tires. Admirable optimism, terrible operations plan.

The final lesson is that EPR is no longer a niche sustainability topic. It is now a boardroom, legal, procurement, logistics, and finance issue. The NAW case proves that recycling policy can affect market access, supplier relationships, product margins, and competitive strategy. Companies should bring legal teams, sustainability leaders, finance departments, and supply-chain managers into the same room early. Give them coffee. Give them data. Do not give them a 200-page regulation five minutes before the deadline and call it teamwork.

Conclusion: A Recycling Law, a Constitutional Test, and a National Wake-Up Call

NAW’s challenge to Oregon’s EPR law is more than a fight over packaging fees. It is a test of how far states can go in shifting recycling costs onto companies that sell or distribute covered products. It also asks how transparent and accountable a private producer responsibility organization must be when it plays a central role in a state regulatory program.

For Oregon, the case threatens a flagship recycling modernization effort. For distributors, it offers temporary relief and a chance to challenge obligations they view as unfair. For other states, it is a warning to build EPR programs with clearer definitions, stronger oversight, and more transparent fee systems. For everyone else, it is a reminder that the humble package is no longer just something you tear open and toss in the bin. It is now a legal, environmental, and economic object with enough complexity to make a shipping label blush.

The outcome will not end the national debate over extended producer responsibility. If anything, it will sharpen it. America’s recycling system needs funding, consistency, and accountability. Businesses need fairness, predictability, and due process. The next phase of EPR law will have to deliver both. That is a tall order, but then again, so is fitting a week’s worth of cardboard into one recycling cart without performing minor household engineering.