Friction Rising Between Ben & Jerry’s & Unilever Over Selling Brand to Israel Licensee; Lawsuit Filed in NY
Edited by: Fern Sidman
It appears that the friction between Vermont ice cream maker, Ben & Jerry’s and their parent company Unilever is escalating as a war of words is intensifying.
The Wall Street Journal reported that Ben & Jerry’s is under the impression that Unilever would undermine the ice cream brand’s reputation. This emanates from the recent publicity that both Ben & Jerry’s and Unilever garnered over the sale of the company in Israel to a licensee.
In July, Ben & Jerry’s filed a complaint with the US District Court in Manhattan to block the sale. This was a result of last year’s decision by Ben & Jerry’s to stop selling its brand in the Judea and Samaria region of Israel and to East Jerusalem, as was reported by the WSJ.
The paper also reported that in a statement issued on Wednesday, Ben & Jerry’s said that its complaint with Unilever is larger than the Israel issue and attempted to explain the rationale for the lawsuit that was filed.
The chairwoman of the Ben & Jerry’s board of directors, Anuradha Mittal, a pro-Palestinian activist said, “This is not just about Ben & Jerry’s 2021 decision concerning sales of our product in the West Bank. If left unaddressed, Unilever’s actions will undermine our social mission and the essential integrity of the brand, which threatens our reputation, and ultimately, our business as a whole.”
In an interview with Reuters, Mittal added that, “This decision for us to go to court is because of Unilever’s sale without our input, which is a clear violation of the letter and the spirit of our original acquisition agreement with Unilever. If Unilever is willing to so blatantly violate the agreement that has governed the parties’ conduct for over two decades, then we believe it won’t stop with this issue. If left unaddressed, Unilever’s actions will undermine our social mission and essential integrity of the brand, which threatens our reputation and ultimately our business as a whole.”
In July, the Washington Free Beacon reported that last year, the National Legal and Policy Center filed a complaint with the IRS over the Ben & Jerry’s Foundation’s grants to a nonprofit group run by Mittal.
Mittal has been a trustee on the Ben & Jerry’s Foundation board since 2012 and also serves on the independent company board. The WFB reported that during this time, the Ben & Jerry’s Foundation gave $195,000 to the Oakland Institute, an anti-Israel nonprofit group run by Mittal that has published columns in support of Hezbollah and Hamas.
Mittal is a leading force behind Ben & Jerry’s decision to halt sales in Israel last July, which anti-Israel activists sought to use as a springboard to pressure other companies to cut economic ties with the Jewish state, as was reported by the WFB.
Mittal has posted on Twitter in support of the Boycott, Divestment, and Sanctions movement, praised singer Shakira for canceling a performance in Israel, and defended Rep. Ilhan Omar’s (D., Minn.) claim that pro-Israel members of Congress have an “allegiance” to a foreign government.
“Criticism of AIPAC is not anti-Semitic & calling for Congress not to have allegiances to foreign countries (Israel) is not anti-Semitic,” Mittal wrote in March 2019, “but targeting the first black Muslim member of Congress with false accusations of anti-Semitism IS Islamophobic!”
World Israel News reported that Unilever has stopped paying salaries to the company’s board members a year after a failed attempt by the ice cream giant to cut sales in Judea and Samaria.
Unilever denied payment to five independent board members as a “pressure tactic,” the board members said, after Ben & Jerry’s sued the consumer goods company in a bid to stop the sale of Israeli operations to its local licensee, Avi Zinger. WIN reported that the move would enable the continuation of Ben & Jerry’s operations in Judea and Samaria, which the ice cream company hoped to end in July 2021 because it was “inconsistent” with its values.
Unilever’s sale to Zinger, announced in June, angered Ben & Jerry’s board members who said that it violated the terms of the takeover deal struck with it, according to the WIN report.
Ben & Jerry’s announcement last year that it would no longer offer its products “in occupied Palestinian territory” was hailed as a victory for the BDS movement, the WIN report said.
The move prompted Unilever’s stock prices to plunge, with losses estimated at around $26 billion. WIN reported that several U.S. states divested their pension funds from Unilever in line with anti-BDS laws — totaling an additional $1 billion.
The WSJ reported that Ben & Jerry’s said in its statement that Unilever’s decision to freeze the board’s compensation was being used as a “pressure tactic” before a recent mediation between the two sides. Those talks ended unsuccessfully last week. The WSJ reported that a hearing on Ben & Jerry’s request for a temporary injunction to block Unilever’s sale of the brand’s Israel business is scheduled for Monday.
Ben & Jerry’s has said that the decision to sell the Israeli operations was made without the approval of the brand’s independent board of directors, according to the WSJ report. When Unilever acquired Ben & Jerry’s in 2000, it agreed to let the brand have an independent board to make its own decisions about its social mission.
Unilever said Wednesday that while the acquisition agreement granted the board the right to decide its social mission, Unilever “reserved primary responsibility for financial and operational decisions.” The WSJ reported that the London-listed company said that therefore, it had the right to sell Ben & Jerry’s Israeli business.
Unilever announced the sale of that business in June, saying the decision followed “extensive consultation over several months.”