“Target’s CEO Brian Cornell and its Board of Directors did not oversee or disclose the obvious risks of Target’s 2023 LGBT-Pride Campaign and the ESG/DEI initiatives which it advanced, but they told investors that they did,” the lawsuit says.
Florida has filed a lawsuit against Target, claiming that the company misled investors about the risk of prioritizing programs for diversity, equity, and inclusion, or DEI.
The lawsuit names defendants including Target, its CEO, and members of the company’s Board of Directors.
“Target’s CEO Brian Cornell and its Board of Directors did not oversee or disclose the obvious risks of Target’s 2023 LGBT-Pride Campaign and the ESG/DEI initiatives which it advanced, but they told investors that they did,” the lawsuit says. “In doing so, they deceived Target investors as to the true nature of the risks of their investments and caused them to unknowingly support Target’s board and management in their misuse of investor funds to serve its divisive political and social goals—and ultimately cost investors billions.”
According to The Associated Press, Target has a longstanding reputation as a proponent of workplace diversity. However, in 2023, the company’s decision to begin selling LGBT-themed merchandise for Pride Month prompted outrage among conservatives, leading to harassment of employees and acts of in-store vandalism.
“The campaign provoked immense consumer backlash and boycotts that caused Target’s sales to fall for the first time in six years and wiped out over $25 billion in Target’s market capitalization—leading Target’s stock to experience its longest losing streak in 23 years,” the lawsuit alleges.
In the lawsuit, recently-appointed Florida Attorney General James Uthmeier said that Target violated the Securities Exchange Act by failing to disclose “the known risks” of publicly supporting different DEI and Pride initiatives.
“Target’s CEO Brian Cornell and its Board of Directors did not oversee or disclose the obvious risks of Target’s 2023 LGBT-Pride Campaign and the ESG/DEI initiatives which it advanced, but they told investors that they did,” the lawsuit says.
“Corporations that push radical leftist ideology at the expense of financial returns jeopardize the retirement security of Florida’s first responders and teachers,” Uthmeier said in a statement. “My office will stridently pursue corporate reform so that companies get back to the business of doing business—not offensive political theater.”
Jimmy Patronis, the state’s chief financial officer, also argued that Target’s policies have cost Florida residents significant amounts of money.
“We’ve seen time and time again that when companies prioritize performative virtue-signaling and wokeness over profitability, they alienate customers, lose market value, and erode shareholder trust—all while pretending their activism carries no financial risk,” Patronis said. “It’s unacceptable and Florida is fighting back on behalf of taxpayers and investors that have had enough. Businesses like Target need to focus on the bottom line and do right by their customers, not some ESG overlords.
Sources
Florida files suit against Target, claiming DEI initiatives ‘misled investors’
Florida sues Target over LGBTQ Pride campaign that sparked consumer backlash, stock drop
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