Recycling Symbols and Labels Are Costing California Businesses

Recycling symbols and labels are ubiquitous on products and packaging. In California, this can mislead consumers, who may find that their product or packaging isn’t recyclable under state law. But change is underway for California businesses following the passage and enforcement of SB343, which requires businesses to proactively document that their products and packaging are recyclable if those products and packaging contain recycling symbols or labels.

The consequences for businesses failing to document compliance are costly, including consumer class action litigation, regulatory enforcement, and substantial penalties. The enforcement and compliance deadline is Oct. 4, 2026, and it’s critical for businesses to undertake compliance efforts now to avoid enforcement.

SB343 shifted the burden to businesses to document, in advance, that their products and packaging with recycling symbols and statements are recyclable in California.

The law establishes some criteria for determining recyclability:

• It’s collected in curbside programs serving at least 60% of California’s population
• It’s sorted into defined streams by at least 60% of the state’s recycling programs where it’s routinely used as feedstock in the production of new products or packaging

Many businesses find these criteria to be unproductive for determining their compliance obligations. Recognizing this, California’s Department of Resources Recycling and Recovery, or CalRecycle, published a study detailing its efforts to characterize the recyclability of product and packaging materials in the state.

Despite CalRecycle’s efforts, compliance remains elusive for many businesses.

Risks of Non-Compliance

Consumer class action lawsuits are an active risk for businesses, even though SB343 isn’t yet technically enforceable by CalRecycle.

Lawsuits have already been filed in California state and federal court, with plaintiffs citing non-compliance with SB343 as evidence of liability. The causes of action in those class action lawsuits are based on alleged violations of California’s Business and Professions Code sections 17200 (Unfair Business Practices) and 17500 (Deceptive Marketing Practices).

The lawsuits allege that recycling symbols and labels on the targeted products and packaging are unfair and deceptive because the materials that comprise those products and packaging aren’t truly recyclable in California. They cite SB343, arguing that the targeted products and packaging aren’t mentioned in CalRecycle’s findings.

The remedies those consumer class action lawsuits seek include class certification, damages, penalties, and attorneys’ fees. But remedies aren’t the most substantial risk for businesses. It’s the mere fact that a business is named as a defendant in a consumer class action that creates the most substantial risk, because this forces businesses to hire litigation counsel and to fund the defense.

Businesses also face risks of regulatory enforcement and penalties, future risks that won’t manifest until after the 2026 compliance deadline. While regulatory enforcement risks aren’t currently pressing for businesses, that doesn’t mean they aren’t consequential. Some of those consequences include regulatory penalties of up to $2,500 per violation as well as misdemeanor criminal liability, including potential imprisonment.

Mitigating or Eliminating Risks

Prophylactic measures exist for businesses seeking to mitigate or eliminate SB343 compliance risks. Measures will vary based on the type of business, its products and packaging, and its use of recyclability symbols and labels.

Removing all recycling symbols and labels for products and packaging is the simplest measure a business can take. Practically, this option could present its own challenges. Removing all recycling symbols or statements may not be feasible for businesses that want to signal to customers that their products are environmentally friendly. Additionally, a product manufacturer may have little or no control over its packaging and the symbols and labels on its packaging.

Short of removing all recycling symbols and labels, businesses looking to mitigate SB343 risk can evaluate their products and packaging against CalRecycle’s study to confirm that they are truly recyclable, then document that fact and maintain those records going forward. The challenge with self-evaluation is that CalRecycle’s findings don’t provide product- and packaging-specific answers on which categories of products and packaging can display recyclability symbols or statements.

The reason why CalRecycle’s findings aren’t product- and packaging-specific is logical—there is significant variation between products and packaging—so to specify each is unworkable and impractical. Instead, CalRecycle’s findings provide general categories of products and packaging and leave it to businesses and their attorneys and consultants to get into the specifics.

Another measure businesses can take is to develop products and packaging specifically for the California market. While this sounds technically feasible, it is impractical because which products or packaging make their way into California for disposal is beyond a business’s control.

Businesses far and wide have products and packaging that come into California. While the compliance deadline for SB343 is more than a year away, most businesses won’t be able to remove or modify recyclability symbols or labels on products and packaging instantaneously. The time for evaluating and documenting compliance is now.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law, Bloomberg Tax, and Bloomberg Government, or its owners.

Author Information

Christopher “Smitty” Smith is partner and chair of the environmental practice group at Greenspoon Marder.

Write for Us: Author Guidelines