Investor sues Target for ‘disastrous’ 2023 Pride campaign, causing billions in market value loss.
A Target Investor Sues the Retail Chain Over LGBT Marketing and Diversity Policies
A Target investor has filed a lawsuit against the retail chain, alleging that it deceived investors regarding the risks associated with its LGBT marketing and diversity, equity, and inclusion (DEI) policies.
The lawsuit, filed by America First Legal (AFL) and co-counsel Boyden Gray PLLC and Lawson Huck Gonzalez PLLC on behalf of investor Brian Craig, claims that Target’s LGBT, ESG, and DEI policies have cost shareholders billions of dollars.
The lawsuit accuses Target and its board of directors of betraying both Target’s core customer base and its investors by making false and misleading statements about the company’s ESG and DEI mandates, which resulted in a disastrous 2023 children-and-family themed LGBT-Pride campaign.
Craig, who owns over 200 Target stores, argues that the corporation’s board of directors and management misled investors about risk management related to social and political messaging. The lawsuit contends that Target failed to consider potential criticism from more conservative customers when implementing ESG and DEI mandates.
Following the backlash to its June “Pride” month displays, Target’s market value declined by $14 billion. The controversy included criticism of the company for selling female swimsuits designed to accommodate male genitalia.
In addition to the controversial swimwear, Target’s “Pride” collection featured small shirts with phrases promoting inclusivity, Pride-themed onesies, and rainbow-colored leggings, tutu skirts, and jumpers.
Target responded to the backlash by removing some products and relocating “Pride displays” to less prominent positions in certain stores. However, the lawsuit claims that the controversy caused the company’s biggest stock decline in history, resulting in significant losses for investors.
AFL Vice President Gene Hamilton stated that Target’s board and management failed to comply with federal law, which requires publicly-traded companies to disclose certain information to investors regarding risk management.
“As alleged in our complaint, Target failed to fulfill its duty to shareholders by providing misleading statements that led them to believe that political and social risks were being assessed. In reality, the company’s focus was solely on meeting the demands of left-wing ‘stakeholders’,” Hamilton explained.
In June, Tesla CEO Elon Musk predicted that Target would face lawsuits from shareholders due to the significant loss of value.
“Won’t be long before there are class-action lawsuits by shareholders against the company and board of directors for destruction of shareholder value,” Musk posted on Twitter.
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