The Government of Canada is moving apace to implement its zero plastic waste agenda, which includes developing and implementing new regulations for plastic manufactured items under the Canadian Environmental Protection Act (CEPA) [1] [2] Consumers are also seeking to enforce their rights in relation to greenwashing claims. The industry is responding with equal vigour, challenging the designation of plastic manufactured items as “toxic substances” and increased regulation of plastic, including plastic packaging.
Key cases to watch in this space, the decisions in which may impact current and future regulation of plastic packaging of consumer products, with implications for businesses, include:
- Gordon v. Keurig Canada Inc. et al. (March 11, 2022), Toronto22/00678262-00 (CP) (Ont. Sup Ct (Civ Div)) (stayed in Buis v. Keurig Canada Inc., 2023 ONSC 87);
- Buis V. Keurig Canada Inc. (January 20, 2022), Ottawa 22/00088299-00CP (Ont. Sup Ct (Civ Div)) (pending certification proceeding);
(1) Keurig proposed class actions
In 2021, the Canadian Competition Bureau concluded that certain of Keurig Canada Inc.’s (Keurig Canada) claims about the steps to prepare their branded single-serve, single-use plastic beverage coffee pods (K-Cups) for recycling were false and misleading, contrary to the Competition Act. In provinces outside of British Columbia and Quebec, the K-Cups were not generally accepted in municipal recycling programs. Moreover, consumers had to take certain steps to prepare the K-Cups for recycling. Consequently, the Competition Bureau found that the recyclability claims in relation to the K-Cups were false and misleading because, in part, 1) the K-Cups were not readily recyclable everywhere across Canada and 2) the steps necessary to prepare the K-Cups for recycling were not adequately disclosed. The Consent Agreement between the Competition Bureau and Keurig Canada provided for payment of monetary penalties and fees and a number of behavioural remedies but did not provide compensation to Canadian consumers.
In March 2022, a Canada-wide class action lawsuit against Keurig Canada was filed in Toronto in the Gordon v. Keurig Canada Inc. et al. matter on behalf of all persons residing in Canada who had purchased these K-Cups and/or Keurig-branded brewing machines during the period that the recyclability claims were made (Gordon). The Gordon claim alleges that the defendants engaged in false, misleading, deceptive, and unconscionable marketing practices. A few months prior, a separate Canada-wide class action lawsuit against Keurig Canada was filed in Ottawa in the Buis v. Keurig Canada Inc. matter (Buis). The Buis claim was made on behalf of all persons residing in Canada who purchased K-Cups.
To avoid overlapping or identical proceedings, a ‘carriage’ motion was brought before the Ontario Superior Court of Justice to determine which proceeding, Gordon or Buis, was the better vehicle that should be allowed to proceed. Pursuant to subsection 13.1 (4) of the Class Proceedings Act, 1992, in a decision dated January 4, 2023, Justice MacLeod stayed Gordon and allowed Buis to proceed on the basis that Buis relied on a theory of damages used in the U.S. class action settlement, was the more focused action (Gordon had a wider potential class and named three defendants), and was more likely to lead to a prompt settlement.
Against the backdrop of the federal government’s draft recyclability claims labelling rules, which once finalized, will affect when and how future civil claims may be made in Canada, the outcome of Buis may set the initial bar for damages in relation to false and misleading environmental claims in Canada, i.e., greenwashing.
(2) Responsible Plastics Use Coalition et al. v. The Minister of the Environment and Climate Change et al.
Over three days in March 2023, the Federal Court of Canada heard an application for declarations quashing or voiding the order adding “plastic manufactured items” to Schedule 1 “List of Toxic Substances” (the Order). As of June 21, 2023, there has been no released decision.
The applicants argued that the Order:
- Intrudes on provincial jurisdiction over waste management under section 92 of the Constitution Act, 1867. This was supported by the intervenors, the Provinces of Saskatchewan and Alberta, who further argued that the Order did not fall within the federal power to legislate in furtherance of the Peace, Order and Good Government of the country, since plastic manufactured items lack the required uniqueness to constitute an issue of national concern.
- Is overly broad and oversteps the permissible bounds, established by the Supreme Court of Canada in R v. Hydro Quebec, [1997] 3 SCR 213, of the federal government’s authority to regulate “toxic” substances under CEPA. The applicants argued that the principles of R v. Hydro Quebec have not been followed as the general category of “plastic manufactured items” is overly broad language, without adequate scientific support demonstrating significant danger to the environment for all manner of things captured by this “substance.”
- Is ultra vires of subsection 90(1) of CEPA. The applicants argued that items must be added one at a time based on an assessment of whether each item is “toxic.” “Plastic manufactured items” are not a single item and the Order is not supported by an adequate scientific assessment demonstrating that all plastic is toxic.
- Is unreasonable and wrong in law given that plastic manufactured items are not a “substance” in or a “class of substances” under section 3 of the CEPA. The class of materials is too broad fall within these definitions and the federal government did not demonstrate the toxic nature of all manner of plastic manufactured items.
The Minister of Environment and Climate Change, the Minister of Health and the Attorney General collectively argued that the Order and the decision to add “plastic manufactured items” to the List of Toxic Substances was reasonable and within their legislative authority under CEPA.
The outcome of this case may course-correct existing regulations, including the ban on single-use plastics, or alternatively, it may support future regulation of plastic manufactured items, including plastic packaging.
(3) Responsible Plastics Use Coalition et al. v. The Attorney General of Canada
The industry launched a second lawsuit challenging the Single-use Plastics Prohibition Regulations in July 2022, which more pointedly challenges the federal ban on several single-use plastic items (SUPs). The Single-use Plastics Prohibition Regulations is the first tranche of regulation following the designation of “plastic manufactured items” as a toxic substance under CEPA.
Among other things, the applicants in this matter seek an order quashing the ban under the Single-use Plastics Prohibition Regulations on importing, manufacturing and selling SUPs. In general, the applicants argue that the decision to ban SUPs is ultra vires the powers of the Government of Canada under part 5 of CEPA, because there is no adequate support demonstrating that SUPs are a “toxic substance” and, as such, the ban cannot be a valid exercise of the federal criminal law power. On March 23, 2023, a case management judge was assigned and as of the time of writing, the respondents had not filed their submissions and the matter had not been set down for hearing.
If the applicants’ legal challenge in the Responsible Plastics Use Coalition et al. v. Minister of the Environment and Climate Change et al. matter is upheld, it may serve as a precedent for challenging future tranches of regulation of plastic manufactured items.
For inquiries regarding regulatory requirements applicable to plastics in consumer products and their packaging, please contact Monica Song and Yulia Konarski.
The author gratefully acknowledges the contribution of Rachel Kuchma and Olivia Graham, Student at Law.
[1] Dentons – Consumer products’ trends to watch in 2022: The war on plastic
[2] The federal government is moving quickly to implement further regulation of plastic under the Canadian Environmental Protection Act
