Oregon Judge Upholds EPR Scheme in Full Against Constitutional Attacks

First-of-its-kind ruling signals that industry should prepare for extended producer responsibility (EPR) compliance as states expand extended producer responsibility programs.

On August 27, 2026, U.S. District Judge Michael H. Simon issued a 71-page decision upholding Oregon’s Plastic Pollution and Recycling Modernization Act (RMA) in its entirety, rejecting every constitutional challenge brought by the National Association of Wholesaler-Distributors (NAW) following a five-day bench trial in July. The ruling marks the first federal court decision sustaining an EPR packaging law against dormant Commerce Clause and Due Process attacks — and it is not the result industry was hoping for.

What the Court Decided

NAW made several Constitutional arguments. First, they argued that RMA violated the Dormant Commerce clause by discriminating against interstate commerce, imposing disproportionate and unreasonable user fees, and/or imposing excessive burdens on interstate commerce compared to local benefits. Second, NAW argued that under the due process clause, RMA affords insufficient process to contest fees, and unconstitutionally delegates fee-setting authority to Circular Action Alliance (CAA), the private nonprofit institution responsible for administering Oregon’s producer responsibility program. The court disagreed on every count, finding that the RMA serves legitimate environmental and public-health purposes, does not favor Oregon businesses over out-of-state competitors, and that the Oregon Department of Environmental Quality (ODEQ) retains adequate oversight of CAA’s operations and fee methodology. Notably, the court found that evidence of higher costs for any given individual producer was only anecdotal and does not establish a substantial burden on interstate commerce.

What This Means for Industry

The practical takeaway is straightforward: Producers selling covered packaging, food serviceware, or printing and writing paper into Oregon must comply with the RMA’s registration, reporting, and fee obligations. The preliminary injunction that had shielded NAW members from enforcement has been lifted. ODEQ (which has continued to send non-compliance warning letters to covered producers throughout the pendency of the litigation) will likely approach enforcement with renewed confidence after yesterday’s ruling.

The compliance burden is real. During trial, one NAW member testified that its CAA invoice consumed roughly 74% of its Oregon gross profit. Another testified that the per-unit fee on a plastic cup approached 50% of the product’s total cost. Producers, particularly wholesalers and distributors operating on thin margins, should budget accordingly and ensure they have systems in place to track material composition, volumes, and SKU-level data across more than 60 material categories.

Looking ahead, the Ninth Circuit Court of Appeals could overturn this decision, but that depends on whether NAW decides to appeal. An appeal would require full briefing, a hearing schedule, and a panel decision, meaning any theoretical reversal is not coming soon. Even if reversed, the Ninth Circuit could merely send the matter back to the District Court rather than overturn the statute. 

In the meantime, Oregon’s framework stands, and there are additional costs and risks associated with a continued “wait and see” approach to compliance. Under CAA’s Participant Producer Agreement (which obligates producers to sign when entering the program), the CAA may assess late charges of up to 1% per month of producer fees owed past the applicable due date, compounded monthly. And the statutory penalty amounts (should an invigorated ODEQ now choose to enforce them) max out at $25,000 per day, per violation.

The Broader Implications

A separate class action challenging the same Oregon EPR scheme remains pending before the same judge, Judge Simon. Given his reasoning in yesterday’s NAW decision, however, that class action case faces steep odds because as discussed in our prior article, the class action echoes the same claims raised by NAW.

Seven states have enacted EPR packaging laws in recent years, including California, Colorado, Minnesota, and Washington, among others. Importantly, this ruling in Oregon is not controlling or binding in other states. Each EPR jurisdiction has its own statute with distinct regulatory nuances, but the Oregon decision likely will serve as persuasive authority that could inform how other courts analyze similar programs.

What Companies Should Do Now

Potential Oregon producers, including companies considering entering the market, should seek legal counsel regarding their compliance obligations before exposure accrues. The window for treating EPR as a theoretical risk has closed in Oregon for now.