Unilever Plc is facing a lawsuit filed by a U.S. shareholder accusing the company of mishandling Ben & Jerry's product sale termination in Israeli-occupied Palestinian territories, Reuters reported.
“According to the proposed class action in Manhattan federal court, Unilever improperly concealed the decision before it was announced, recognizing that many U.S. states might divest from companies that support anti-Israel boycotts, yet stood behind it once the news became public,” a Reuters report stated.
The lawsuit was filed by a Michigan pension fund, the City of St. Clair Shores Police and Fire Retirement System, with Chief Executive Alan Jope and Unilever's board members also serving as defendants.
"As a result of defendants' wrongful acts and omissions, and the declines in the market value of Unilever ADRs, plaintiff and other class members have suffered significant losses and damages," the complaint said.
The complaint was submitted after Ben & Jerry's confirmed its plans to cease operations in Israeli-occupied West Bank and parts of East Jerusalem last July.
According to the report, Israeli ice cream maker, American Quality Products Ltd, filed a similar lawsuit against Ben & Jerry's in March, assuring the company’s inability to refuse to renew its new license.
The lawsuit goes on to highlight that a total of seven states, including Florida, Texas and New York have opted to divest their pension fund investments in Unilever.
The price of Unilever American depositary receipts have declined by 8% over six days as Florida and Texas determined the steps it would take with the British consumer goods company, and other brands accused of promoting Ben & Jerry's.
Established in 1978, Ben & Jerry's was initially acquired by Unilever in 2000.