Target has been sued over allegedly concealing the risks associated with its diversity and social initiatives, leading to a backlash that negatively impacted its stock price. The proposed class action lawsuit, filed in Florida federal court, claims that the retailer’s Environmental, Social and Governance (ESG) initiatives have led to consumer boycotts and undermined investor funds.
The lawsuit states that Target failed to disclose the risk of these boycotts and concealed the consequences of a May 2023 Pride Month campaign. The backlash led some employees to fear for their safety after in-store confrontations, prompting the retailer to remove certain LGBTQ-themed merchandise.
Target’s share price plummeted 22% on November 20, 2024, wiping out approximately $15.7 billion in market value, following a disappointing forecast and holiday sales. The lawsuit claims that this underperformance stood in stark contrast to rival Walmart’s results, reflecting “continued backlash” from Target’s campaigns.
The case seeks damages for Target shareholders between August 26, 2022, and November 19, 2024. It was filed after Target announced the end of its Diversity, Equity and Inclusion (DEI) initiatives in January 2024, including a program supporting Black-owned businesses.
Source: https://ca.finance.yahoo.com/news/target-sued-defrauding-shareholders-dei-224901614.html