Court dismisses Greenpeace lawsuit against Walmart

Sept. 20, U.S. District Court Judge Maxine Chesney dismissed a lawsuit Greenpeace Inc. filed against Walmart in late 2020, saying the organization lacked standing for the case to be considered on the merits. In the suit, Greenpeace USA alleges that Walmart uses unlawful, unfair, and deceptive business practices by incorrectly labeling and advertising its various private-label plastic products and packaging as recyclable.

The lawsuit highlighted nearly a dozen examples of what Greenpeace says are Walmart’s private-label products with unqualified and otherwise problematic recyclable labels, with the organization adding that these examples are just the tip of the iceberg.

According to Federal Trade Commission (FTC) guidelines, a product or package cannot be marketed as recyclable unless it can be “collected, separated or otherwise recovered from the waste stream through an established recycling program for reuse or use in manufacturing or assembling another item.” Because the suit was dismissed on a legal technicality, this clear violation of the law is allowed to stand, the organization says.

Greenpeace says labeling Walmart’s packaging as recyclable also violates California Environmental Marketing Claims Act (EMCA), which regulates deceptive environmental marketing claims.

In response to the court’s ruling, Greenpeace USA Oceans Campaign Director John Hocevar says, “Walmart sells more products packaged in throwaway plastic than almost any other polluter in the world. Big brands know their customers are growing concerned about plastic pollution, but, instead of addressing real solutions, they have opted for greenwashing. 

“Walmart failed to take action when we pointed out that they were labeling packaging as recyclable when it was headed for landfills and incinerators,” Hocevar continues. “When we finally took them to court, Walmart used a legal technicality to challenge our right to file rather than addressing the substance of the case.” 

He adds that California’s “SB 343 will end this kind of greenwashing in California, and nationwide legislation is soon to follow.”

According to that California bill, which as of Sept. 23 had not been signed into law by Gov. Newsom, a product or packaging type would be considered recyclable in California if, based on information published by the California Department of Resources Recycling and Recovery (CalRecycle), the product or packaging is of a material type and form collected for recycling for jurisdictions that collectively encompass at least 60 percent of the state.”

This legislation is consistent with the FTC guidelines on recyclability claims.

“The failure of companies like Walmart to move away from single-use plastic and shift to reuse, refill and package-free approaches is prompting a wave for regulations across the U.S. and around the world,” Greenpeace’s Hocevar says. “The more they duck responsibility, the greater the demand for stronger regulations.”

Greenpeace USA says it is reviewing the court’s ruling and evaluating all legal options. 

Creighton Magid, a partner at the international law firm Dorsey & Whitney in its Washington office, helps clients navigate the federal regulatory system, particularly in connection with the U.S. Consumer Product Safety Commission.

Regarding the decision to dismiss the case, he says, “The dismissal order throws a bucket of cold water on lawsuits brought by environmental organizations under state consumer deception statutes. It’s not enough to argue that claims of recyclability are misleading; to bring a lawsuit under such a statute, the organization has to show that it was misled. Greenpeace and similar organizations have a hard time making that showing because they’re not inclined to believe that plastic is recyclable generally. As Judge Chesney made clear in her order, that’s the Achilles’ heel in this type of lawsuit.”