Yahoo Finance Unilever accused of hiding Ben & Jerry’s Israel boycott from shareholders
Unilever is being sued by a US investor over claims it hid a boycott of Israel by its Ben & Jerry’s ice cream brand that wiped billions of US dollars off its stock market value.
According to the proposed class action in Manhattan federal court, Unilever improperly concealed the decision before it was announced, recognising that many US states might divest from companies that support anti-Israel boycotts, yet stood behind it once the news became public.
The lawsuit was filed by a Michigan pension fund, the City of St. Clair Shores Police and Fire Retirement System.
Unilever was contacted for comment.
Ben & Jerry's announced last July it would stop selling its products in the Israeli-occupied West Bank and parts of East Jerusalem, as well as severing its three-decade relationship with an Israeli ice cream maker that rejected the ban.
The price of Unilever American depositary receipts (ADRs) fell nearly 8pc over six days as Florida and Texas reviewed their relationships with the British consumer goods company, and some Jewish groups accused Ben & Jerry's of anti-Semitism.
Seven states including Florida, Texas and New York later divested their pension fund investments in the Hellmann's maker, according to the complaint.
It said: “As a result of defendants' wrongful acts and omissions, and the declines in the market value of Unilever ADRs, plaintiff and other class members have suffered significant losses and damages.”
Chief executive Alan Jope and Unilever's board are also defendants.
Founded in 1978, Ben & Jerry's has long positioned itself as socially conscious, and kept its independence to pursue that mission after being acquired by Unilever in 2000.
Ben & Jerry's said last July that selling ice cream in the occupied Palestinian territories was "inconsistent with our values".
Most countries consider Israeli settlements in those territories illegal, which Israel disputes.
The Israeli ice cream maker, American Quality Products, sued Ben & Jerry's in March for refusing to renew its licence. A New Jersey judge put that case on hold last week after the parties agreed to arbitration.
The consumer goods giant earlier this week came under fire from another shareholder, Nick Train from Lindsell Train Investment Trust, who claims the company is suffering from "long Covid" that has left its performance "pedestrian".
He said that the firm’s exposure to emerging markets is hitting performance as sales are "recovering slowly, if at all in some cases".
