The Vermont-based ice cream maker filed a complaint Tuesday in U.S. District Court in New York, seeking an injunction against Unilever ( UL ) “to protect the brand and social integrity that Ben & Jerry’s has spent decades building.”
Ben & Jerry’s has been doing business in Israel since 1987, but has come under pressure in recent years to sell in West Bank settlements considered illegal under international law. In July 2021, it announced that it would stop selling on the West Bank entirely.
That sparked a dispute with its longtime distributor in Israel, American Quality Products (AQP), which sued Ben & Jerry’s and Unilever in March, alleging they were “illegally ending a 34-year business relationship to boycott Israel.”
Unilever, one of the world’s biggest sellers of consumer goods including Dove soap and Magnum ice cream, tried to draw a line under the row with its announcement last week that it had sold Ben & Jerry’s Israeli business for an undisclosed sum to AQP.
The retail giant said that going forward, Ben & Jerry’s will be sold under its Hebrew and Arabic names in Israel and the West Bank.
But that decision to sell to AQP took Ben & Jerry’s board by surprise, according to the court filing, which said its chairman was “stunned” when he heard the news.
As of 2021, Ben & Jerry’s has vehemently opposed selling its products on the West Bank, saying it would be “inconsistent with” the brand.
In its complaint on Tuesday, it noted that its brand values are legally controlled by an independent board of directors under a 2000 agreement with Unilever.
The board decided to take legal action last week at a meeting where five directors voted to settle litigation and two Unilever appointees dissented, Ben & Jerry’s said.
In a statement last week, Unilever acknowledged that “Ben & Jerry’s and its independent board have been empowered to make decisions about its social mission.”
But it maintains that the parent company “retains primary responsibility for financial and operational decisions and therefore has the right to enter into this agreement.”
In a new statement on Wednesday, a Unilever spokesman reiterated that it “has the right to enter into this agreement”.
“The deal is now closed,” the representative said, adding that he would not comment on pending litigation.
In a statement last week, Unilever said it had conducted a review of its business there “over several months, including with the Israeli government”.
“Unilever has taken the opportunity of the past year to listen to viewpoints on this complex and sensitive issue and believes this is the best outcome for Ben & Jerry’s in Israel,” he added.
— Jordan Walinski contributed to this report.
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