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July 6, 2022

Ben & Jerry’s sues Unilever over sale of ice-cream operations in Israel

Ben & Jerry’s is seeking a court injunction against Unilever’s decision.

By Simon Harvey

Ice-cream maker Ben & Jerry’s has filed a lawsuit in the US against parent company Unilever over the FMCG giant’s decision to sell its operations in Israel.

Owned by Unilever since 2000, Ben & Jerry’s filed the case in the US District Court in Manhattan yesterday (5 July) alleging the deal announced last week with American Quality Products Ltd (AQP) violates the two parties’ original merger and shareholder agreement.

Unilever revealed on 29 June it had sold its Ben & Jerry’s business interests in Israel to Avi Zinger, the owner of AQP, the current Israel-based licensee, for an undisclosed sum.

Ben & Jerry’s, founded in 1978 in Vermont by friends Ben Cohen and Jerry Greenfield, announced last July it would no longer distribute its products in Israel-controlled land in the West Bank and East Jerusalem claimed by Palestine. The decision prompted a backlash from Israeli Prime Minister Naftali Bennett.

Ben & Jerry’s is suing Conopco, a subsidiary of Unilever, according to media reports. The Cookie Dough ice-cream maker is seeking a temporary restraining order and permanent injunction against Unilever. The company wants to prevent Unilever and any third parties from selling its ice cream in the West Bank.

“This dispute concerns the autonomy of Ben & Jerry’s independent board of directors, and the core values the company has spent the last 44 years establishing,” Ben & Jerry’s said in its filing to the US district court in Manhattan, according to The Financial Times.

CNBC reported the court judge on Tuesday denied Ben & Jerry’s application for a temporary restraining order but reportedly ordered Unilever to demonstrate by 14 July why a preliminary injunction should not be issued.

Unilever said last week the new business arrangement with AQP follows a review of Ben & Jerry’s in Israel and the deal will “ensure the ice cream stays available to all consumers”.

It added: “The new arrangement means Ben & Jerry’s will be sold under its Hebrew and Arabic names throughout Israel and the West Bank under the full ownership of its current licensee.”

Unilever said under the terms of its takeover of Ben & Jerry’s the ice-cream maker and its independent board were granted rights to make decisions about its social mission. However, the FMCG group said it reserved primary responsibility for financial and operational decisions and therefore has the right to enter such an arrangement.

Just Food approached both Ben & Jerry’s and Unilever for comment today (6 July).

Unilever responded, reiterating its comment on 29 June that it “had the right to enter this arrangement”. A spokesperson said: “The deal has already closed. We do not comment on pending litigation.”

The company explained in last week’s statement: “Unilever has used the opportunity of the past year to listen to perspectives on this complex and sensitive matter and believes this is the best outcome for Ben & Jerry’s in Israel. The review included extensive consultation over several months, including with the Israeli government.

“Unilever rejects completely and repudiates unequivocally any form of discrimination or intolerance. Anti-semitism has no place in any society. We have never expressed any support for the Boycott Divestment Sanctions (BDS) movement and have no intention of changing that position.”

The international BDS movement seeks to pressure Israel to abide by international law in its treatment of the Palestinians. Israel says such boycotts are discriminatory and anti-semitic.

Responding to Unilever’s decision to sell Ben & Jerry’s local operation, Israel’s Minister of Foreign Affairs, Yair Lapid, who revealed he had spoken in the last few days with CEO Alan Jope and Avi Zinger, said: “Anti-semitism will not defeat us, not even when it comes to ice cream. We will fight delegitimisation and the BDS campaign in every arena, whether in the public square, in the economic sphere or in the moral realm.”

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