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New York court rejects suit against Unilever over Ben & Jerry’s Israel boycott

A Michigan pension fund sued for compensation for a drop in shares' value.

A Ben & Jerry's mobile ice-cream truck. Credit: Pixabay.
A Ben & Jerry's mobile ice-cream truck. Credit: Pixabay.

A Manhattan judge dismissed a lawsuit against Unilever on Tuesday that claimed the company misled U.S. investors by not immediately disclosing a decision by its Ben & Jerry’s unit to stop selling ice-cream in Israeli territory over the 1949 armistice lines (“Green Line”).

The City of St. Clair Shores Police and Fire Retirement System, a Michigan pension fund, filed suit in June 2022, seeking damages for a drop in the price of Unilever shares after Ben & Jerry’s announced in July 2021 that it would end sales in eastern Jerusalem, as well as in Jewish communities in Judea and Samaria, commonly known as the West Bank.

U.S. District Judge Lorna Schofield found that Unilever was not required to disclose the boycott when Ben & Jerry’s board decided on it in 2020 because Unilever had ultimate control over whether to implement it.

While Ben & Jerry’s board oversees its “social mission,” Unilever retained authority over financial and operational decisions when it bought the Vermont-based ice-cream company in 2000.

The self-described socially conscious Ben & Jerry’s said in 2021 that selling ice cream in the territories was “inconsistent with our values.”

Last December, Unilever announced that it had resolved a legal battle with the independent board of Ben & Jerry’s.

Months earlier, the British consumer goods conglomerate sold its Ben & Jerry’s ice cream business in Israel to local licensee Avi Zinger for an undisclosed sum. Ben & Jerry’s responded by filing a lawsuit against its parent company Unilever in an attempt to block the sale.

In an updated lawsuit filed in September 2022, Ben & Jerry’s said it was seeking damages and wanted the trademarks returned. The brand also asked a judge to stop Zinger from selling the ice-cream in Judea and Samaria.

Ben & Jerry’s has also faced allegations of using child labor.

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