Ben & Jerry’s sues Unilever over sale of Israeli business

Ben & Jerry’s filed suit against its parent company Unilever on Tuesday in an effort to block its sale of the Vermont-based brand’s Israel business to a local franchisee.

The left-leaning ice cream brand, which is known for championing liberal causes, alleged in a complaint filed in US District Court in Manhattan that Unilever’s “unilateral decision” was made without board consent.

The ice cream company said an injunction blocking the sale was “essential to preserve the status quo and protect the brand and social integrity Ben & Jerry’s has spent decades building.”

Ben & Jerry’s board of directors voted 5-2 last Friday to authorize a legal filing against Unilever, according to details included in the brand’s complaint. The dissenters were two directors appointed by Unilever.

The company asked a federal judge to block the transfer of Ben & Jerry’s trademark and brand rights to any entity that would sell the product or use its logo in the West Bank without prior board approval.

Representatives for Ben & Jerry’s and Unilever did not immediately return requests for comment on the lawsuit.

Last week, Unilever said it had reached an agreement to sell its Ben & Jerry’s business in Israel to its current local franchisee, Avi Zinger, and his firm, American Quality Products Inc.

The company noted Ben & Jerry’s board retained rights related to its “social mission” but noted, “Unilever reserved primary responsibility for financial and operational decisions and therefore has the right to enter this arrangement.”

Ben & Jerry’s founders, Ben Cohen and Jerry Greenfield, sold the company to Unilever in 2000 for $326 million.

“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 conglomerate said in a statement on the sale. “The review included extensive consultation over several months, including with the Israeli government.”

In July 2019, the ice cream brand said it would end sales of its products in Jewish settlements in the occupied West Bank. Zinger recently reached a settlement with Ben & Jerry’s for declining to renew his license, according to Reuters.  

The Israeli government lauded the sale as a victory over “antisemites.” But the transaction drew a sharp public rebuke from Ben & Jerry’s.

The ice cream maker’s lawsuit came just days after the company said a sale ran contrary to the brand’s beliefs.

“We continue to believe it is inconsistent with Ben & Jerry’s values for our ice cream to be sold in the Occupied Palestinian Territory,” the company said in a statement.