On Tuesday, July 5, 2022, Ben & Jerry’s sued its parent company, Unilever, in an attempt to stop the sales of its ice cream in the West Bank through a third party distributor.
The complaint states that Ben & Jerry’s is “[a]n institution that is known for the principled, progressive stances it takes on various societal issues, both domestically and internationally.” The company’s corporate model is “based on the concept of ‘linked prosperity,'” whereby “profit, quality, and social impact serv[e] as co-equal principles.” Ben & Jerry’s has been linked to a number of societal issues, including: 1% for Peace (challenging the Reagan administration’s Cold War spending policy); Support Farm Aid (supporting grassroots efforts to keep family farmers on their lands); LGBTQ+ rights; Fight for the Reef (protecting Australia’s Great Barrier Reef); and Black Lives Matter.
In 1999, Ben & Jerry’s was approached by several potential buyers interested in acquiring the company. Ben & Jerry’s entered into a merger agreement with Unilever in 2000. This merger agreement “expressly empowers an Independent Board of Directors” and “also recognized that the mechanism for preserving Ben & Jerry’s business reputation and goodwill was to maintain the autonomy of the Independent Board of Directors over all matters regarding the Social Mission and Essential Integrity of the Brand.” From 2000 through 2021, the Independent Board of Directors continued the company’s social activism.
In 2013, Ben & Jerry’s started received complaints about the human rights implications of selling its products in the West Bank territory occupied by Israel. A committee was formed in 2018 to investigate the matter. A factfinding mission was conducted in 2019 to meet with numerous stakeholders. Afterwards, the Independent Board of Directors unanimously decided that “it would be inconsistent with the essential elements of the brand’s integrity to continue selling Ben & Jerry’s products in the West Bank.” In April 2022, the distributor for Ben & Jerry’s in the West Bank sued Ben & Jerry’s and Unilever over the decision to stop sales in the West Bank.
In June 2022, Unilever informed the Independent Board of Directors that Ben & Jerry’s trademarks and brand rights would be transferred to a third-party purchaser in order to sell products in the West Bank. The complaint filed by Ben & Jerry’s alleges causes of action for breach of the merger agreement and breach of the shareholders agreement. Relief is requested in the form of a temporary restraining order, preliminary injunction, and permanent injunction preventing the transfer of trademarks and brand rights which would permit the sale of products in the West Bank, without prior approval of the Independent Board of Directors. The complaint also seeks an order requiring Unilever to dissolve any agreement made with the third-party purchaser “that would cause the distribution or sale of Ben & Jerry’s products or the transfer or use of Ben & Jerry’s Marks in the West Bank.”
Judge Andrew L. Carter denied Ben & Jerry’s request for a temporary restraining order on Tuesday. Judge Carter, however, ordered Unilever to show cause why a preliminary injunction should not be imposed.
Additional Reading
Ben & Jerry’s sues parent company Unilever over sale of Israeli business, CNBC (July 5, 2022)
Ben & Jerry’s Homemade, Inc. v. Conopco, Inc. (Case No. 1:2022cv05681)
Complaint in Ben & Jerry’s Homemade, Inc. v. Conopco, Inc.
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