A federal judge in Florida says Target will have to face a lawsuit from a shareholder over the fallout from its sales of LGBTQ-themed merchandise last year. The suit accuses Target of misleading shareholders about the retail giant’s efforts to protect the company from social and political risks.
The conservative group America First Legal is headed by President-elect Donald Trump’s close adviser Stephen Miller. The group filed the lawsuit on behalf of a shareholder after Target’s Pride Month merchandise sales led to a customer boycott.
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They allege the company overlooked the risks of embracing company policies under the frameworks of ESG, or “environmental, social and governance,” as well as DEI, or “diversity, equity and inclusion.”
Investors said in their court filing that Target “neglected to mention the known risk of adverse customer and stockholder reactions to its ESG/DEI mandates in general, and its ‘Pride Month’ campaigns in particular.”
Target had urged the judge to throw the lawsuit out. The company said they acknowledged the risk of the campaigns. They say the suit is based only on the investor not liking the company’s business decisions.
The judge’s ruling against Target means the case will proceed. However, whether it will continue in Florida is the next legal question.
The judge said he will handle Target’s request to move the case to its home jurisdiction in Minnesota in a future order.
