Ben & Jerry's files new lawsuit against parent company Unilever

15/11/2024 6:04

        Ice cream brand Ben &
        Jerry's said in a lawsuit filed Wednesday that parent company
        Unilever has silenced its attempts to express support
        for Palestinian refugees and threatened to dismantle its board
        and sue its members over the issue.
        
        The lawsuit is the latest sign of the long-simmering
        tensions between Ben & Jerry's and consumer products maker
        Unilever, which is planning to spin out its ice cream business
        next year.
        
        The spin out would include the top-selling Vermont-based
        maker of Chubby Hubby, although experts on corporate governance
        said the brand's board, a centerpiece of the new lawsuit, could
        present challenges to the deal.
        
        A rift first erupted between Ben & Jerry's and Unilever in
        2021 after the ice cream maker said it would stop selling its
        products in the Israeli-occupied West Bank because it was
        inconsistent with its values, a move that led some investors to
        divest Unilever shares.
        
        The ice cream maker then sued Unilever for selling its
        business in Israel to its licensee there, which allowed
        marketing in the West Bank and Israel to continue. That lawsuit
        was settled in 2022.
        
        In its new lawsuit, Ben & Jerry's says that Unilever has
        breached the terms of the 2022 settlement, which has remained
        confidential. As part of the agreement, however, Unilever is
        required to "respect and acknowledge the Ben & Jerry's
        independent board's primary responsibility over Ben & Jerry's
        social mission," according to the lawsuit.
        
        But, according to the lawsuit, "Ben & Jerry's has on four
        occasions attempted to publicly speak out in support of peace
        and human rights. Unilever has silenced each of these efforts."
        
        In response to Reuters' story, Unilever said in an emailed
        statement: "Our heart goes out to all victims of the tragic
        events in the Middle East. We reject the claims made by B&J’s
        social mission board, and we will defend our case very
        strongly."
        
        "We would not comment further on this legal matter," it
        added.
        
        The lawsuit was filed in New York federal court.
        
        Minor Myers, a professor at the University of
        Connecticut School of Law, said the tension between Ben &
        Jerry's and Unilever would be top of mind in a deal,
        particularly if Unilever's ice cream brands are acquired by a
        private equity firm or competitor company.
        
        "The Ben & Jerry's situation, would be front of mind of
        any possible buyer," Myers said. "To the extent that Ben &
        Jerry's or a subsidiary wants to be liberated to say (what they
        want, it) may impact the sales of the flagship ice cream brand."
        
        That would result in a lower valuation for Unilever's
        ice cream brands, Myers said.
        
        There are fewer concerns if the ice cream brands become
        a separate publicly traded company, Myers said.
        
        Ben & Jerry's said in the lawsuit it has tried to call for a
        ceasefire, support the safe passage of Palestinian refugees to
        Britain, back students protesting at U.S. colleges against
        civilian deaths in Gaza, and advocate for a halt in U.S.
        military aid to Israel, but has been blocked by Unilever.
        
        The independent board separately spoke out on some of those
        topics, but the company was muzzled, the lawsuit says.
        
        Ben & Jerry's said that Peter ter Kulve, Unilever's head of
        ice cream, said he was concerned about the "continued perception
        of anti-Semitism" regarding the ice cream brand voicing its
        opinions on Gazan refugees, according to the lawsuit.
        
        Unilever was also required under the settlement agreement to
        make a total of $5 million in payments to Ben & Jerry's for the
        brand to make donations to human rights groups of its choosing,
        according to the lawsuit.
        
        Ben & Jerry's selected the left-leaning Jewish Voice for
        Peace and the San Francisco Bay Area Chapter of the Council on
        American-Islamic Relations, among others, the filing says.
        
        Unilever in August objected to the selections, saying that
        Jewish Voice for Peace was "too critical of the Israeli
        government," according to the lawsuit.
        
        Ben & Jerry's has positioned itself as socially conscious
        since Ben Cohen and Jerry Greenfield founded the company in a
        renovated gas station in 1978. It kept that mission after
        Unilever acquired it in 2000.
        
        Unilever's dozens of products include Dove soap, Hellmann's
        mayonnaise, Knorr bouillon cubes, Surf detergent and Vaseline
        petroleum jelly.