Keurig forced to pay CA$3M fine for false coffee pod recyclability claims

14 Jan 2022 --- Keurig Dr. Pepper Canada has been forced to pay a CA$3 million (US$2.3 million) penalty to the country’s Competition Bureau, as well an unspecified amount in a US class-action lawsuit, following misleading claims made about the recyclability of its single-use K-Cup coffee pods. 

Canada’s Competition Bureau determined the company was making false statements in its advertising campaigns via its website, social media and on text and logos on the K-Cup pods and packaging. 

“Portraying products or services as having more environmental benefits than they truly have is an illegal practice in Canada,” says Matthew Boswell, the Bureau’s commissioner of competition. 

“False or misleading claims by businesses to promote ‘greener’ products harm consumers who are unable to make informed purchasing decisions, as well as competition and businesses who actually offer products with a lower environmental impact.”

Greenwashing coffee 
Keurig is accused of portraying its K-Cup pods as recyclable throughout Canada, when in fact only the provinces of Quebec and British Columbia have the infrastructure needed for processing them. 

Enough K-Cup coffee pods have been sold to stretch around the earth at least ten times, according to Greenpeace.Moreover, the Bureau concluded that Keurig Canada’s claims about the steps involved to prepare the pods for recycling are false or misleading in certain municipalities. 

“Keurig Canada’s claims give the impression that consumers can prepare the pods for recycling by peeling the lid off and emptying out the coffee grounds, but some local recycling programs require additional steps to recycle the pods,” reads a statement by the Bureau. 

In addition to its US$2.3 million fine, the company will also have to donate CA$800,000 (US$639,000) to a Canadian charitable organization focused on environmental causes and pay CA$85,000 (US$68,000) for the costs of the Bureau’s investigation. 

Keurig, who uses the motto “brew a better world,” will also be required to publish corrective notices about the recyclability of its product on its websites, social media, in national and local news media, on the packaging of all new brewing machines, and via email to its subscribers. 

On top of this, the company will be forced to enhance its corporate compliance program as necessary to promote compliance with the laws and prevent deceptive marketing issues in the future. 

Keurig’s apology 
Canada’s Competition Bureau acknowledges that Keurig voluntarily settled the matter. 

Keurig made US$4.43 billion in net sales of coffee in 2020.Cynthia Shanks, senior director for communications and sustainability at Keurig Canada, issued a statement explaining the company switched the most commonly recyclable form of plastic – polypropylene (PP) – for its K-Cups three years ago, but many recycling streams still do not accept the pods. 

“As we continue working with municipalities and the recycling industry to increase K-Cup pod recycling acceptance, we’ve been evolving our communications with consumers to share that the pods are recyclable in select communities and remind them of the appropriate steps to recycle,” says Shanks.

“The agreement with the Competition Bureau of Canada will further enhance our communications, reminding consumers to verify whether K-Cup pods are accepted in their municipality’s recycling program and, if so, any additional steps that may be necessary to prepare the pods for recycling.”

US class-action lawsuit 
According to Keurig’s annual reports, the company made US$4.43 billion in net sales of coffee in 2020 alone. A class-action lawsuit against the company in the US has been settled, though the terms of the settlement have not yet been made public. 

The lawsuit, which was filed by California-based Lexington Law Group, who also successfully sued Terracycle recently for greenwashing claims, accused Keurig of unlawful and misleading advertising regarding the recyclability of its PP coffee pods. 

Despite the company’s line “Keurig is making every cup matter,” Greenpeace estimates less than 5% of PP in the US is ever recycled. 

By Louis Gore-Langton

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