Mind the greenwashing gap: ClientEarth helps companies avoid plastic lawsuits with briefing series

23 Sep 2022 --- British environmental law charity ClientEarth has released a series of briefings detailing how companies using plastics for packaging or fashion can avoid litigation as legislation against greenwashing, chemical use and waste disposal becomes increasingly stringent.

Numerous companies have ended up in court over the past several years, with pressure mounting on brands to take responsibility for their environmental impact and give consumers an honest account. 

Rosa Pritchard, plastics lawyer at ClientEarth and author of the briefings, tells PackagingInsights that businesses using plastics in all sectors are at risk, and the likelihood of being taken to court is rising. 

“Companies across the plastics value chain, from fossil fuels companies to consumer goods giants and waste management companies, should be on high alert – as they are increasingly exposed to lawsuits,” she asserts. 

Major brands are increasingly at risk of litigation.“We want decision-makers in these companies, and those who are investing in them, to know that litigation risks are growing. They need to factor these risks into their decision-making on plastics, including in what approaches they should take to the plastic crisis, noting litigation on greenwashing and promoting so-called ‘false solutions’ to the plastic crisis is a particular threat.” 

Avoiding lawsuits 
The briefing is divided into four key areas of potential conflict: greenwashing, hazardous chemicals, environmental damage, and waste disposal and recycling. Each of these subjects gives way to possible legal trouble if companies are not well informed and diligent in their practices.  

Greenwashing lawsuits have spiked sharply in the past year as consumer awareness over misinformation is rising. An example includes the US and Canadian suits filed by consumers against big-name consumer companies (Keurig, BlueTriton and Coca-Cola), alleging that claims regarding the recyclability of products are misleading.

The agreement for a global plastics pollution treaty by the United Nations also brought the expectation of a “tidal wave” of lawsuits in the near future. Pritchard says that vigilance is now necessary both to prevent litigation and to avoid adding to the already tightening web of legal restrictions.  

“Litigation is expensive and resource-intensive for companies. It generates huge public attention and can cause irreparable reputational harm to companies. There is also a risk – especially with innovative cases, which we see in the plastics space – that new precedents will be set in the courts which fundamentally affect what companies can and can’t do,” she says.

Chemicals and waste 
If industry is not more careful with their practices, the law may become more stringent.The advice issued on hazardous chemicals follows several EU decisions to phase out thousands of potentially dangerous chemical additives, many of which are commonly used in plastics. 

“Plastics-related litigation is already on the rise, and there’s no reason to think this will change anytime soon. Across the value chain, concern about the health impacts of plastic additives is giving rise to lawsuits in the US,” says Pritchard. 

“Consumers and citizens, NGOs, shareholders, competitor companies, and groups whose livelihoods are affected by the plastics crisis are already holding companies accountable for their plastic impacts, and they are increasingly using the courts to do so.” 

The briefings on disposal and recycling are similar. False recycling promises made by large companies have also brought lawsuits, some of which have been successful, against major brands and retailers. One such example was a Californian suit against TerraCycle that forced the company to change its labeling practices and implement supply chain certification.

“At the end-of-life phase, we have seen lawsuits against consumer goods companies for plastic waste, a major investigation into the perpetuation of the recycling ‘myth’ by the fossil fuel industry and a number of criminal prosecutions against companies and directors involved in the waste trade,” continues Pritchard. 

Investor interest 
Finally, and perhaps most importantly, Pritchard highlights that investors are showing a strong interest in these themes – as are insurers – as it “clearly affects both their underwriting and investment activities.” 

“So we’ve had a lot of interest in the briefings from investors, banks and insurers and NGOs – both environmental and consumer protection. The rise of plastic-related lawsuits is not happening out of the blue. It’s happening at a time when the world is producing twice as much plastic waste as it was two decades ago,” she says.  

“We are drowning in plastic, and surveys show that people worldwide have had enough. Companies across the plastics value chain cannot keep churning out more plastic.” 

By Louis Gore-Langton