Does your company make public statements that it cares about, and is working meaningfully toward, environmental sustainability?
If yes, this article is for you.
The opinion released by the District of Columbia Court of Appeals on August 29, 2024, demonstrates that even aspirational statements, such as the company’s statement on its website that it aims “to achieve positive change in the world and build a more sustainable future for our communities and our planet,” can be actionable under consumer protection laws for being false and misleading representations. Earth Island Inst. v. Coca-Cola Co., No. 22-CV-0895, 2024 WL 3976560 (D.C. Aug. 29, 2024).
In 2021, Earth Island Institute, an environmental organization, filed a complaint against The Coca-Cola Company (“Coca-Cola”). The complaint alleged that Coca-Cola engaged in false and deceptive marketing, misrepresenting itself as a sustainable and environmentally friendly company, despite being one of the world’s largest contributors to plastic pollution. In Earth Island’s telling, Coca-Cola generates more plastic than any other company in the world, producing 2.9 million metric tons of plastic waste per year.
“[R]ecycling has proven overwhelmingly insufficient in addressing global plastic pollution,” Earth Island continues. “A mere 9 percent of all plastic that has been produced since the 1950s has been recycled, while 79 percent has ended up in landfills or the natural environment.”
Despite “[having] done very little to address the immense problem of global plastic pollution and [having] even actively opposed legislation proven to improve recycling rates,” Coca-Cola represents itself as working toward environmental sustainability. Earth Island cited the following statements from Coca-Cola’s website, Coca-Cola’s Business & Sustainability Report, and its official Twitter (now “X”) feed:
Coca-Cola aims to “[m]ake 100% of [its] packaging recyclable globally by 2025.” It also aims to “[u]se at least 50% recycled material in [its] packaging by 2030.”
“Part of our sustainability plan is to help collect and recycle a bottle or can for every one we sell globally by 2030.”
“Our plastic bottles are made to be remade. We are carefully designing them to be 100% recyclable—even the caps. Our goal is for every bottle to become a new bottle, and not end up in oceans, rivers, beaches and landfills. And that means we are using less new plastic.”
“Our planet matters. We act in ways to create a more sustainable and better shared future … [t]o make a difference in people’s lives, communities and our planet by doing business the right way.”
“Scaling sustainability and partnering with others is a focus of ours.”
“We’re using our leadership to achieve positive change in the world and build a more sustainable future for our communities and our planet.”
“As it exists right now, recycling infrastructure in the United States is incapable of keeping pace with Coca-Cola’s incredibly high production rates,” Earth Institute explained. “Market.us estimates that Coca-Cola sells 1.8 billion bottles per day, and that globally, people consume over 10,000 soft drinks from Coca-Cola every second of every day. … And despite Coca-Cola’s heavy emphasis on recycling in its advertising and online representations, the vast majority of its bottles end up in landfills or entering the natural environment as pollution. … [I]n 2018 only 8.7 percent of all recyclable plastics in the United States were recycled.”
Earth Institute alleged that “Coca-Cola is categorically not a sustainable company and misleads consumers in presenting itself as such” and that “Coca-Cola misleads consumers by overstating the benefits of recycling, as well as the capacity and ability of waste management companies and municipalities to economically recycle the large amount of PET bottle waste that companies such as Coca-Cola produce.” “The facts, as alleged above, demonstrate that Coca-Cola has violated the [D.C. Consumer Protection Procedures Act (CPPA)], D.C. Code § 28-3901 et seq.,” Earth Institute concluded.
Coca-Cola moved to dismiss Earth Island’s complaint for failure to state a claim. The trial court granted the motion, ruling that:
Coca-Cola’s statements were “general, aspirational corporate ethos” that did not create a claim under the CPPA;
Coca-Cola’s statements did not appear on the product label and thus were not tied to a “product or service” as required by the CPPA; and
Coca-Cola’s statements, being “blatantly cherry-picked from various publication sources,” were not actionable under the CPPA, as “[t]he statute provides a cause of action for a misleading ‘material fact,’ not a bungle of different statements taken from various documents at different times.”
Earth Island Institute v. The Coca-Cola Co., No. 2021 CA 001846 B, 2022 WL 18492133 (D.C.Super. Nov. 10, 2022).
The District of Columbia Court of Appeals reversed. Addressing the trial court’s three bases for dismissal, it ruled that:
Even aspirational statements can be actionable under the CPPA if they reasonably lead to the belief that the company is meaningfully pursuing its stated goals, or at least intends to, when in reality it is not. Here, Coca-Cola made a statement that it “ast[s] in ways to create a more sustainable and better shared future.” However, Earth Island alleged that Coca-Cola has no real intention of meaningfully reducing its production of single-use plastic. If that is true, then Coca-Cola’s statements could mislead reasonable consumers.
Coca-Cola’s statements are related to “goods and services,” which are interpreted as “any and all parts of the economic output of society, at any stage or related or necessary point in the economic process.” D.C. Code § 28-3901(a)(7). “Coca-Cola’s packaging is part of the products that it sells, and the environmental impact of how it creates that product, and what becomes of it, are qualities of the product itself under the CPPA’s broad approach to goods and services,” the Court explained.
While a CPPA claim typically cannot be based on a “grab-bag of statements that no reasonable consumer would ever be likely to see in combination,” in this case, it is appropriate to consider Coca-Cola’s statements in the aggregate, as “[i]t is plausible enough that a consumer curious about Coca-Cola’s environmental impacts would come across the variety of statements relied upon by Earth Island through some casual Googling.” Earth Island, 2024 WL 3976560, at *12.
This decision emphasizes the importance of aligning public statements about sustainability with actual practices. Even aspirational statements about the company’s sustainability plans can be actionable under the CPPA. Each case requires analyzing whether these statements lead reasonable consumers to believe that the company is actively pursuing, or at least intends to pursue, its stated goals, and whether this belief reflects the truth.
The information provided in this article is intended for informational purposes only and does not constitute legal advice. It should not be relied upon or applied without consulting an attorney to address your specific circumstances. Please note that this article was published on the date indicated and may not reflect subsequent changes in the law.
