Navigating the Greenwashing Maze: The Multiple Pathways of Risk to Consider for Environmental Marketing Claims

As American consumers continue to focus on the environmental attributes of products, companies making environmental marketing claims continue to field risk from several different directions. While this type of advertising may not be a current priority for the federal government, recent litigation trends show that the risk of advertising in this space can also come from state or local regulators, consumers, and competitors. We take a look at recent examples from each of these areas below:

• State Enforcement: Federal enforcement related to green marketing claims may be quiet as of late, but states are filling in the enforcement gap. All states have consumer protection laws in place, and California, in particular, has laws that focus on the types of “green” claims that can be made about a product. In the most recent example of state enforcement related to greenwashing, California Attorney General Rob Bonta filed suit in the Superior Court of California against Novolex Holdings, LLC, Inteplast Group Corp., and Mettler Packaging LLC (collectively, the Defendants). Under California Senate Bill 270 (SB 27), single-use plastic bags are banned from being offered at the point of sale at certain stores in California unless they meet certain criteria, including being recyclable within California and being labeled as such with instructions for recycling. According to the complaint, the Defendants’ plastic bags are not actually recyclable, despite being marketed as such. When consumers attempt to recycle them per the instructions on the bags, they “generally end up in landfills or incinerators.”¹ The state accuses the Defendants of misleading consumers and violating SB 270 as well as California’s Environmental Marketing Claims Act, False Advertising Law, and Unfair Competition Law.²
• Local Enforcement: In addition to state enforcement, there are also local considerations related to greenwashing. For example, in September, the city of Philadelphia sued S.C. Johnson & Son and Bimbo Bakeries USA in the Philadelphia County Court of Common Pleas for purportedly deceiving consumers about the recyclability of their LDPE (RIC #4) plastic bag products. The city alleges that the companies violated Philadelphia’s Consumer Protection Ordinance, Phila. Code § 9-6300 et seq., which was enacted in 2024 and “enable[s] the City to protect consumers from deceptive marketing such as Defendants’ claims about their bags’ recyclability.”³ While the lawsuit acknowledges that some recycling programs nationwide accept plastic bags, it also states that “for almost all of those programs, nearly all of those collected plastic bags nevertheless go to waste due to . . . the absence of any significant end market for reprocessed plastic bag material.”⁴ Citing the Federal Trade Commission (FTC) and the U.S. Environmental Protection Agency, the complaint argues that it is not whether a product can be “theoretically” recycled that matters when considering whether a recyclability claim is deceptive, but “whether recyclability marketing provides consumers with realistic expectations.”⁵ Based on consumer surveys, the city also alleges that consumers misunderstand any use of the chasing arrows symbol on a plastic product to mean it can be recycled, “regardless of whether those chasing arrows appear around a number as part of a RIC, alongside some qualifying language, or in any other context.”⁶ According to the city, because plastic bags “almost always go to waste,” “no matter how hard consumers try to recycle those plastic bags,” the companies’ recyclability claims are “confusing to the ordinary consumer, causing them to [falsely] think that they can buy Defendants’ products without contributing to plastic waste.”⁷
• Consumer Litigation: In addition to facing government enforcement, companies making environmental claims can also face consumer class action lawsuits. Allegations of companies making false or misleading statements that cause consumers to spend more on a product than they would have had they known the truth have proliferated, especially in the “greenwashing” space. To mitigate the risk of these demands, environmental benefit claims should be carefully tailored to fit the support a company has for the claim. Broad claims are easily targeted in consumer class actions. For example, Rust-Oleum Corp. recently agreed to pay $1.5 million to settle allegations that it deceptively marketed its cleaning products as “non-toxic” and “Earth Friendly.”⁸ The plaintiff had filed suit in the U.S. District Court for the Northern District of California, alleging that these claims were misleading because the cleaning products contained chemicals that could be harmful to humans, animals, and the environment. In addition to the monetary settlement, Rust-Oleum agreed to (1) remove the “non-toxic” claims from its product labeling; and (2) add an asterisk to the “Earth Friendly” claims on its products’ front labels that will direct consumers to the back label, where it will state: “Contains no inorganic phosphates, hazardous solvents, or environmentally harmful surfactants.”⁹
• Competitor Challenges: Challenges brought by competitors can take two forms: (1) litigation, or (2) challenges filed in front of the National Advertising Division of the Better Business Bureau National Programs (NAD). In the litigation context, competitors may bring actions under the Lanham Act and state consumer protection laws. For example, personal protective equipment manufacturer Moldex-Metric, Inc. (Moldex) recently sued one of its competitors for alleged violations of the Lanham Act and California’s Unfair Competition Law and False Advertising Law. According to the complaint, the competitor falsely advertises its earplugs as “eco-friendly,” “sustainable,” and “bio-based.”¹⁰ Moldex accuses the defendant of using unqualified environmental benefit claims to “convey[] to consumers that the products have specific and far-reaching environmental benefits with little or no negative environmental impact.”¹¹ This marketing has the purported effect of misleading consumers into believing they are making a “smarter ‘environmental’ choice” when buying these products over competitors’ products.¹²

As an alternative to litigation, companies or trade associations will often bring advertising challenges against their competitors in front of the NAD. In one recent decision from this spring, the International Bottled Water Association challenged several claims Boxed Water Is Better (Boxed Water) made about its boxed water products, including claims that the packaging was “100% recyclable” and “renewable,” and that Boxed Water is “better for the planet” and “sustainable.” The NAD ultimately determined that Boxed Water’s claims that its cartons are “recyclable” were supported under the FTC’s Green Guides, as Boxed Water submitted data showing that 62% of households and communities have access to recycling facilities that would accept Boxed Water’s cartons.¹³ The NAD also found that certain general environmental benefit claims were appropriately qualified in context by surrounding statements explaining the specific environmental benefits the carton offers.¹⁴ However, the NAD recommended that Boxed Water modify several of its other claims to provide consumers more context about the claims, and recommended that it discontinue a claim that Boxed Water was the “most renewable option in the water aisle” as Boxed Water did not submit supporting evidence for this claim.¹⁵

As reflected in the above examples, companies making environmental marketing claims have several avenues of risk to consider, including government enforcement, consumer lawsuits, and competitor challenges. Ensuring environmental claims are narrowly tailored to the claim’s support is crucial to help mitigate these various risks. If you have any questions about how your company can lower the risk of making green claims about your products, please reach out to the authors or any of their colleagues on Arnold & Porter’s Consumer Protection & Advertising team.

© Arnold & Porter Kaye Scholer LLP 2025 All Rights Reserved. This Blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.