Plastics trade groups seek to limit California recycling probe

Washington, D.C. — Two plastics trade associations are asking a federal court to rein in a probe by California Attorney General Rob Bonta into whether the industry made dishonest claims about recycling.

The American Chemistry Council and the Plastics Industry Association argue that Bonta's tactics are chilling their speech and political advocacy.

The groups filed separate but related lawsuits in U.S. District Court in Washington on May 24, asking the court to scale back or toss out subpoenas Bonta gave them as part of an investigation that he launched in 2022.

Bonta's investigation, which mirrors climate lawsuits against fossil fuel companies, is probing whether the industry has oversold recycling for decades — including chemical recycling — to the public and lawmakers as a solution to plastics waste.

The lawsuits are one of the few public glimpses inside the ongoing probe.

Bonta subpoenaed others, including ExxonMobil Chemical Co., when he began the investigation in 2022. In April, Reuters quoted Bonta saying that he could decide "in the coming weeks" on the probe.

But the plastics groups are now pushing back on Bonta's subpoenas, accusing him of trying to punish them for holding views on plastics policy that differ from Bonta's.

The industry groups said the attorney general was trying to unconstitutionally chill their political activity by seeking internal documents on member companies' views, in ways that it said violate legal precedent on free speech and political activity within groups.

"The California Attorney General may disagree with ACC's political views, including our recommended policies for creating a more sustainable plastics future, but the U.S. and California constitutions protect free speech and political engagement and prohibit government officials from retaliating against the exercise of those rights," said Allison Starmann, ACC's general counsel.

Similarly, Matt Seaholm, the president and CEO of the plastics association, said the lawsuit was about protecting free speech and political rights of its member companies.

"The Plastic Industry Association has cooperated with the California Attorney General's requests for the last two years, but it is imperative that we continue to protect our members' First Amendment rights," he said.

"The plastics industry is investing billions of dollars in innovative technologies to increase recycling rates and we remain committed and willing to work with policymakers to keep plastic out of the environment and in our circular economy," Seaholm said.

Bonta's office did not respond to a request for comment but told Reuters that it was reviewing the lawsuits and "remains fully committed to holding accountable the fossil fuel industry for its decades-long campaign of deception regarding the plastics crisis."

Both ACC and the plastics association said they had provided non-confidential documents in response to the subpoenas.

But in a May 3 letter from Bonta to ACC, which ACC made public, the attorney general's office called the chemical association's response "dismal" and said its free speech claims would not protect untruthful speech designed to "fraudulently sway" government policy.

In the subpoena, the California deputy attorney general leading the probe, Nina Lincoff, said Bonta has received information that ACC's "promotion and marketing of recycling plastic may have resulted in legal violations," including in false advertising, unfair competition, product liability and consumer protection.

Bonta told ACC that it had not produced any evidence that providing the documents would violate its rights to speech, assembly or petitioning the government.

"ACC's privilege claims lack merit, and we request ACC promptly produce the documents … responsive to the subpoena by May 17, 2024," Bonta wrote.

When he launched the probe, Bonta created a website detailing what he said was industry deception, including serious doubts by executives about the economic viability of recycling going back to the 1980s. Bonta pointed to quotes in a 2020 documentary interviewing former senior plastics association leaders.

ACC's lawsuit centers around Bonta's attempt to uncover information about an ACC study of public attitudes on chemical recycling, which the group provided to the Federal Trade Commission last year as part of that agency's ongoing effort to write new environmental marketing rules, known as the Green Guides.

The ACC report, the Environmental Claims Study (ECS), did public polling in early 2023 that found that 88 percent of Americans consider advanced recycling, another term for chemical recycling, to be a legitimate form of plastics recycling.

But Bonta's office, in public comments to the FTC, took a different position on chemical recycling, calling on the agency to say traditional mechanical recycling is preferred, and to limit green advertising around plastics with poor recycling rates like flexible film.

ACC issued a news release in April 2023 noting that the ECS report formed a key part of its comments for FTC's plan for new rules for environmental marketing, including for plastic recycling.

Bonta's letter said the subpoena seeks information about the "funding, proposal, planning, execution and follow-up" of the study.

"It appears this study, formulated between a partnership of members and ACC, demonstrates the plastic industry's continued attempts to fraudulently sway the government and public into believing that they are creating solutions to the plastics waste and pollution crisis, while in reality, exacerbating the crisis," Bonta's letter said. "Correspondence of this nature would not be protected by the First Amendment."

But ACC said that Bonta was trying to find out which ACC member companies worked on the ECS report, and to threaten ACC and its members into silence because they and Bonta have opposite viewpoints on chemical recycling.

"[Bonta] is using his investigative power to intimidate ACC and its members, to silence speech and to undermine the federal government's request for public comment on matters of public concern," ACC's lawsuit said. "The court should intervene to halt those abuses."

ACC called Bonta's communications a "naked attempt to pinpoint which of ACC's members joined together to petition the federal government" in the Green Guides review.

The association said Bonta's subpoena has caused the group to limit its government activities.

For example, it told the court it decided not to do a second public opinion survey for the FTC and to cut back its advocacy in California, because of fears of another subpoena.

"Without data from the new survey, ACC has had to modify its advocacy efforts to the FTC, degrading its ability to speak, and preventing ACC from engaging in further public speech," the group said.

"ACC's speech has been further chilled in California where ACC has been reluctant to engage fully on certain policy issues important to its members' California interests for fear that its advocacy strategies and communications on those topics may be subject to additional singling out and retaliation from Defendant Bonta."

Similarly, the plastics association said Bonta's subpoena has chilled its communication, and it asked the federal court to block enforcement.

"The effect of Mr. Bonta's position has been an immediate and significant chilling of PLASTICS' ability to interact and communicate with its members, lawmakers, regulators, and others," it said, adding that it has "has limited full candid speech to its members, due to fear that the California Attorney General will demand unlimited access to such communications."

In its lawsuit, it said Bonta was trying to access protected association archives going back decades that are stored at the Hagley Museum and Library in Wilmington, Del., as well as internal association communications and newsletters.

The plastics group argues those are privileged documents reviewing internal strategy, policy discussions and membership data. It said access to the Hagley archives is limited to association members and scholars, but not litigators, government investigators or journalists.

The association's lawsuit chronicles what it said were two years of providing non-privileged information to Bonta, as well as a log of privileged communications it gave to Bonta that summarized private documents.

ACC also gave Bonta a log of more than 550 documents it said were privileged.

Similar to Bonta's May 3 letter to ACC, the plastics association lawsuit said Bonta sent it a letter April 5 demanding those privileged communications or it would seek to enforce its subpoena. Bonta's actions have limited open speech within the association, the group said.

"Some PLASTICS staff have stopped engaging in open discourse — including the free and candid exchange of information and the formation and development of the Association's public policy positions — knowing that their private views and communications could be disclosed if a First Amendment privilege is not protected," the association said.

While the plastics association lawsuit did not include a copy of Bonta's demand letter, the letter Bonta sent to ACC said the chemical association's claims of privilege and the log of documents it said were confidential were too vague to be properly evaluated by courts.

"ACC has not provided a single correspondence with a single member, nor has ACC identified any member or representative of any member," the association said. "ACC's position appears to be that all correspondence with all members concerning any issue is confidential. This proposition is not supported by the law."