NEW YORK, Nov 14 (Reuters) – Ben & Jerry’s has filed a lawsuit against its parent company, Unilever, accusing it of blocking the ice cream brand’s attempts to publicly support Palestinian refugees and threatening to dismantle its board. The legal action, filed on Wednesday in federal court, highlights the ongoing tensions between the two companies, especially as Unilever plans to spin off its ice cream business next year.
The lawsuit underscores a deepening rift between the Vermont-based brand, known for its social activism, and its British multinational parent, which has historically exercised control over Ben & Jerry’s operations. The case also raises questions about the future of the ice cream brand amid Unilever’s efforts to restructure its portfolio.
Background of Dispute
This latest legal battle marks a continuation of tensions that first flared in 2021 when Ben & Jerry’s announced it would cease selling its products in the Israeli-occupied West Bank, citing concerns over human rights and its social mission. This decision led to backlash from some investors, who subsequently divested their Unilever holdings. Later, the ice cream maker sued Unilever after the company sold its Israeli business to a local licensee, allowing sales in the West Bank to continue. That lawsuit was settled in 2022.
According to the new complaint, Ben & Jerry’s alleges that Unilever has violated the terms of the 2022 settlement, which required the parent company to respect the independence of Ben & Jerry’s board, particularly its commitment to the brand’s social mission. The lawsuit claims that Ben & Jerry’s attempted to publicly advocate for human rights on four separate occasions, including calls for a ceasefire, support for Palestinian refugees, and advocacy for U.S. military aid to Israel to be halted. In each case, the brand claims Unilever blocked its efforts.
Unilever Responds
Unilever rejected the accusations in a statement, expressing its condolences to all victims of the ongoing violence in the Middle East and denying the claims made by Ben & Jerry’s. “We reject the claims made by B&J’s social mission board, and we will defend our case very strongly,” the company said. “We would not comment further on this legal matter.”
Ben & Jerry’s, however, expressed confidence that the dispute would be resolved through legal channels but refrained from commenting further on the specifics of the ongoing litigation.
Corporate Governance and the Spin-Off
The tensions between the two companies could complicate Unilever’s planned spin-off of its ice cream business, which includes Ben & Jerry’s iconic products like Chubby Hubby and Half Baked. Legal and corporate governance experts suggest that the presence of Ben & Jerry’s independent board—central to the current lawsuit—could present challenges to the spin-off, particularly if Unilever sells the ice cream business to a private equity firm or competitor.
Minor Myers, a professor of law at the University of Connecticut, noted that potential buyers would likely be concerned about the ongoing conflict and the brand’s advocacy positions, which could affect the business’s valuation. “The Ben & Jerry’s situation would be front of mind for any possible buyer,” Myers explained. “To the extent that Ben & Jerry’s or a subsidiary wants to be liberated to speak out, it may impact the sales of the flagship ice cream brand.”
However, he added that if the ice cream business were spun off into a separate publicly traded entity, these concerns might be less significant.
Disagreement Over Donations and Social Advocacy
The lawsuit also alleges that Unilever blocked Ben & Jerry’s from donating to certain organizations, including the left-leaning Jewish Voice for Peace and the Council on American-Islamic Relations, both of which were chosen by the brand to receive funds as part of the 2022 settlement. Unilever reportedly objected to Jewish Voice for Peace, arguing that the group was “too critical of the Israeli government.”
Ben & Jerry’s, founded in 1978 by Ben Cohen and Jerry Greenfield, has built its identity around social activism. Even after its acquisition by Unilever in 2000, the brand has continued to champion progressive causes, positioning itself as a socially responsible company. However, the latest lawsuit underscores the ongoing friction between its mission and the business interests of its parent company.
Unilever, whose diverse portfolio includes brands such as Dove, Hellmann’s, and Knorr, has not commented on the broader implications of the dispute for its ice cream business.
Looking Ahead
As the litigation moves forward, the future of Ben & Jerry’s social mission and its relationship with Unilever remains uncertain. The case serves as a reminder of the challenges that can arise when a socially conscious brand operates under the umbrella of a multinational corporation with broader commercial interests.
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