The International Bottled Water Association (IBWA) has filed a lawsuit challenging the constitutionality of newly-added provisions of New York's Returnable Container Act (RCA)—also known as the "Bottle Bill." The suit alleges that certain Bottle Bill provisions added as part of New York's 2009-2010 budget law improperly impede interstate commerce while violating IBWA members' equal protection and due process rights.
Joining IBWA as plaintiffs in this lawsuit are Nestle Waters North America, Inc. and The Polar Corp. d/b/a Polar Beverages.
The Bottle Bill, originally passed in 1982, is intended to encourage recycling and to reduce litter and waste. It requires consumers to pay a five-cent deposit when purchasing certain bottled beverages and permits consumers to obtain a refund of that deposit by returning the empty bottle to the retailer.
IBWA strongly supports the Bottle Bill's goal of encouraging recycling and environmental conservation and is not challenging the deposit requirement or the recycling portions of the Bottle Bill. Rather, the IBWA lawsuit concerns the new labeling requirements, unrealistic effective date and special exemptions granted to certain IBWA members' competitors in the recent Bottle Bill amendments.
Under the new Bottle Bill, all bottles covered by the law must contain a special New York-specific bar code. The law prohibits bottles with that New York bar code from being sold in other states, even if those states' laws would permit the sale. IBWA believes that the New York bar code requirement is unconstitutional because it controls commerce occurring in other states.
While the new Bottle Bill applies to nearly all forms of bottled water, including flavored water, vitamin water and water containing artificial sweeteners, it creates an exception for bottled water products that have sugar added. The new Bottle Bill gives no reason why water with sugar should not be covered by the law when all other forms of water are covered. Indeed, the sugar water exception runs counter to the important environmental goals of the Bottle Bill. IBWA believes this arbitrary exception, which gives special preference to companies that sell sugar water products, violates the U.S. Constitution's Equal Protection Clause.
IBWA also seeks a reasonable amount of time for its members to comply with the new Bottle Bill, which is set to take effect on June 1, 2009. The new Bottle Bill imposes a number of different requirements on IBWA members, including the need to design new product labels, register those labels with the state, implement a distribution system that ensures New York-labeled bottles are offered for sale only in New York, and create a process to handle redemption of empty bottles by consumers.
IBWA members are unable to prepare for all these complex requirements in such a short time (less than 60 days after the law was passed). The original law provided the soft drinks and beer industries 15 months to comply with a far simpler system than the recently enacted changes. IBWA has asked the court to prevent the new Bottle Bill from taking effect for a reasonable period of time sufficient for its members to prepare for the law's new requirements.
The suit was filed in U.S. District Court in Manhattan.