In December, Walmart was sued for allegedly deceiving consumers about the recyclability of its private-label product packaging. Not just called out on social media or criticized in a vigilante blog post, but sued in California Superior Court in Alameda County. While the first hearing isn’t until this month and a ruling is far from determined, the nuance at the center of this legal battle illuminates a core complexity — and key point of contention — in the world of consumer packaging.
To understand the case, let’s first review the legal definition of recyclability. The Federal Trade Commission’s Green Guides prohibit marketing something 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."
Recyclability is legally defined not by potential, but by what happens in practice.
While any product, package or material could theoretically be recycled with the right quantity and under the right conditions, the FTC’s definition of unqualified recyclability for consumer packaging legally ties marketing claims to collection, sortation and end markets. That means recycling facilities must be available for at least 60 percent of consumers where an item is sold; the entire item (excluding minor components) must be technically recyclable and large enough to make it through a materials recovery facility’s (MRF) sorting system; and the material must have enough value to justify recycling.
The first two pieces of the FTC definition are nuanced but more easily navigable than the question of end markets. How2Recycle, the leading recycling labeling scheme administered by GreenBlue and the Sustainable Packaging Coalition (SPC), assesses sortation and reprocessing capacity based on the Association of Plastics Recyclers’ Design Guide and sortation protocols. It evaluates community access through its Centralized Study on Availability of Recycling, previously updated in 2016 and set to be updated again later today.
(It’s worth noting that Greenpeace took issue with SPC’s methodology for calculating community access, so it developed an independent study in partnership with NGO The Last Beach Cleanup. Greenpeace uses this data in a 2020 report that spells out the basis for its case against Walmart. Others have criticized Greenpeace’s methodology. But that’s a rabbit hole for another day.)
Recyclability is legally defined not by potential, but by what happens in practice.
The final piece of the recyclability puzzle — an actual assurance that recycling is happening — is where things get even more complex, to say the least. The FTC’s Statement of Basis and Purpose, updated in 2012, asserts that "to make a non-deceptive unqualified claim, a marketer should substantiate that a substantial majority of consumers or communities have access to facilities that will actually recycle, not accept and ultimately discard, the product."
The problem is that there is no publicly available database of what materials are actually recycled.
Which brings us to the case against Walmart, filed by Greenpeace, which alleges that the world’s largest retailer is liable for "unlawful, unfair, and deceptive business practices with respect to the advertising, marketing, and sales of plastic products or plastic packaging." According to the suit, Walmart’s private-label product packaging (specifically, lower-value Nos. 3-7 and unidentified plastics) breaks California Environmental Marketing Claims Act and FTC guidelines by proclaiming the recyclability of packages that won’t actually be recycled.
"The labels at issue educate consumers on how they may responsibly recycle packaging, have been developed by third-party sustainability experts and comply with federal and state laws," a spokesperson from Walmart told me via email. Walmart filed a motion to dismiss the case, and intends to defend against the suit.
Recycling markets are dynamic. Most MRFs don’t disclose proprietary information about the quantity and value of what they sell to reprocessors. Collection data alone doesn’t account for what MRFs can sell, not to mention the prevalence of recycling contamination. So how is Walmart — and every other retailer or brand that produces packaging — expected to figure out and track what’s recycled in practice across tens of thousands of communities? From where I sit, this is the crux of the challenge.
For companies that use the How2Recycle label, GreenBlue recently released a comprehensive update to its guidance on end markets. It has also downgraded the recyclability of certain plastics based on weak or ambiguous end markets. Greenpeace asserts the guidance is insufficient, and labels that encourage consumers to "check locally" are fundamentally deceptive.
The problem is that there is no publicly available database of what materials are actually recycled.
To help fill the obvious data gap, nonprofit The Recycling Partnership plans to publish its Pathway to Recyclability framework this month, when it will open for stakeholder review and comment. The tool is intended to provide companies with clear, aligned feedback on whether packages can navigate the recycling system and, if not, what actions need to be taken.
"We want to build something transparent, data-driven and with as many players as possible so that we can get to the heart of the truth for all of us. Not just what one perspective is," Keefe Harrison, CEO of The Recycling Partnership, told me. "We want the truth, not the perspective."
Even with incomplete information and gaps in the data, it’s widely understood which packaging materials are more and less valuable in the market. The scrutiny of marketing claims will continue to rise, particularly for brands and retailers proclaiming to have met this moment with ambitious packaging goals. Regardless of this lawsuit’s outcome, the days for unchecked recycling claims are numbered.
