FORT MYERS, Florida (LifeSiteNews) — Retail company Target misled investors about the harmful effects of its implementation of “Environmental, Social and Governance” (ESG) standards and “diversity, equity, and inclusion (DEI), according to a federal lawsuit.
America First Legal accused the retailer of “misleading representations about its Environmental, Social, and Governance (ESG) and Diversity, Equity, and Inclusion (DEI) mandates, and for causing Target shareholders to lose billions of dollars.”
The lawsuit, on behalf of a shareholder, took aim at the company’s risk monitoring. Target has been the source of controversy for years, going back to its decision, relatively unprecedented at the time, to allow gender-confused men to enter women’s bathrooms in stores. Its LGBT clothing, including some from a Satanist, contributed to the loss of the company’s value.
America’s First noted that in May 2023:
Target embraced the radical transgender agenda with its children-and-family-themed “Pride” marketing and sales campaign – the corporation’s infamous “Pride” collection included clothing for young children with rainbow Mickey Mouse symbols, LGBT-themed bibs and onesies for babies, and “tuck-friendly” bathing suits for “transgender women.” This predictably caused more than a $12 billion collapse in share value, the largest stock price decline in over 20 years.
The lawsuit alleged violation of securities law when the company’s board “caus[ed] Target to issue proxy statements that falsely and misleadingly stated that Target’s Board and its committees.”
The company did not respond to a Monday morning LifeSiteNews inquiry seeking comment on the lawsuit.
The lawsuit accused Target of trying to portray itself as the place for “working families” to shop while it “spent Target’s valuable financial and reputational capital on the pursuit of ESG and DEI mandates behind the facade of Target’s classic middle-class brand — all the while falsely and misleadingly portraying the risks of its strategy to Target’s shareholders in order to secure its re-election and insulate itself from accountability.”
The company, according to AF Legal, should have known the risks it was taking on, to the detriment of its shareholders.
The complaint stated:
Defendants knew their ESG and DEI mandates were a double-edged sword that risked backlash. After all, Target itself experienced significant backlash from its customers after Target became the face of corporate opposition to North Carolina’s transgender bathroom law in 2016. Defendants knew companies like Walt Disney and Anheuser-Busch experienced immense backlash to similar LGBT initiatives. Defendants knew that peer companies included the risk of backlash in their oversight of the social and political risks to their ESG and DEI mandates.
Shareholders were led to believe by the board that the DEI and ESG mandates were not harming the company, the lawsuit alleged. “Relying on these proxy statements, Target shareholders re-elected Target’s Board, turned down multiple proposals via shareholder vote to reform the Board’s risk oversight functions at Target’s 2022 and 2023 annual meetings, and approved executive compensation plans that incentivized Target’s officers to implement DEI programs.”
This “unchecked” woke agenda culminated in Target targeting kids as young as toddlers with its LGBT items.
“No rational board of directors or management of a retailer with a core customer base of working families would have approved such a nationwide campaign; nonetheless, Target’s officials pursued it,” the lawsuit stated.
AF Legal called the “dramatic and sudden loss in company market capitalization” a “direct and predictable result” of “management’s calculated decisions to promote sexualized material to children” as well as the board’s “lack of oversight.”
The “virtue signaling to culturally extreme ‘stakeholders’ came “at the expense of the corporation’s core customer group of families and parents, whose reputational views are paramount, as Target itself has recognized.”
AF Legal general counsel Gene Hamilton said his group will ensure his client’s rights are “vindicat[ed]” in court.