American Apparel & Footwear Association (AAFA) is taking California regulators to court over who will run the state’s landmark textile recycling program.
The national trade association filed a petition in Sacramento County Superior Court against the California Department of Resources Recovery and Recycling—setting up a fight over control of the industry’s first extended producer responsibility system.
The suit challenges CalRecycle’s decision to appoint Landbell USA as the sole producer responsibility organization (PRO) under SB 707—the first U.S. law requiring apparel brands to fund and manage textile waste. AAFA argued the selection fails to meet core statutory requirements, including that the PRO be producer-led, a registered nonprofit and governed by a representative board, and is now petitioning to have the decision vacated and reconsidered.
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“We can’t get off on the wrong foot,” said Stephen Lamar, president and CEO of AAFA. He argued that failing to follow the statute at the outset risks weakening confidence among brands and other stakeholders expected to participate in the program. “We certainly can’t get off on a foot that’s a step so far outside of the statutory requirements.”
AAFA’s challenge centers on four requirements set forth in the law: that the PRO be formed by producers, structured as a nonprofit, governed by a diverse board and equipped with financial controls to prevent costs from escalating.
“All four of those requirements are essential to how this program is built and run,” Lamar told Sourcing Journal. “The statute is very clear…and the decision didn’t meet those requirements.”
The group filed its challenge just weeks after the decision, as companies face a July 2026 deadline to register with the PRO and begin complying with the law. The compressed timeline, Lamar said, makes it critical to resolve governance questions quickly so the industry can move forward.
“The service provider doesn’t have the same incentives to keep costs low that the producers do,” Lamar said. “At the end of the day, this is about accountability. We ask the industry to be accountable—governments need to be accountable as well.”
As California prepares to roll out what could become the largest textile EPR program globally, the case raises a separate question: Will the systems that hold industry accountable be held to the same standard? For Lamar, the successful outcome is a “producer responsibility organization formed by producers, governed by a diverse board, structured as a 501(c)(3) and built with strong financial controls.”
CalRecycle has said that Landbell USA was selected for its ability to implement the program effectively. While the former did not respond to Sourcing Journal’s request for comment, the latter did.
“Having been selected as the PRO by CalRecycle, Landbell USA is focused on meeting the demands of the Responsible Textile Recovery Act (SB 707),” Patrick Gibbs, executive director at Landbella USA, said over email. “We will continue to be guided by CalRecycle on our statutory obligations, focusing on excellence in delivery.”
