Ben & Jerry’s vs. Ben & Jerry's: Israeli Licensee Sues Ice Cream Giant

Lawsuit filed in U.S. federal court Thursday alleges that Ben & Jerry’s and Unilever violated U.S. and Israeli law after ending the business relationship with the local licensee because of sales in West Bank settlements

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A laborer working on a production line filling ice-cream pots at the Ben & Jerry's factory in Be'er Tuvia, southern Israel, last July.
A laborer working on a production line filling ice-cream pots at the Ben & Jerry's factory in Be'er Tuvia, southern Israel, last July. Credit: EMMANUEL DUNAND / AFP
Ben Samuels
Ben Samuels
Washington

WASHINGTON – The licensee that manufactures and distributes Ben & Jerry’s in Israel announced Thursday it is suing both the ice-cream giant and parent company Unilever in U.S. federal court, over last summer’s decision by Ben & Jerry’s to end the relationship due to sales in West Bank settlements.

Ben & Jerry’s said last July that selling its ice cream in the occupied territories was “inconsistent” with its values.

According to a lawsuit filed in the U.S. District Court for the District of New Jersey, where Unilever is headquartered, American Quality Products (AQP) and its owner Avi Zinger allege that the decision by Ben & Jerry’s violated both U.S. and Israeli law, and the court must enable AQP to continue selling Ben & Jerry’s products unabated.

AQP and Zinger’s legal representatives argue that Unilever’s alleged demand of ceasing sales in one part of Israel while continuing in other parts is unlawful in both countries. The licensee and Ben & Jerry’s had enjoyed a 34-year relationship before the ice-cream firm said it be would be ending the deal this year.

Further, they claim that terminating the license on the grounds that Unilever did not want to break the law constitutes wrongful termination and breach of contract under U.S. law. Zinger and AQP are accordingly seeking an injunction to enable the continued manufacture and distribution of Ben & Jerry’s products in “all” of Israel. 

Protesters marching against Ben & Jerry's Ice Cream near the New York Public Library last August.Credit: Michael M. Santiago / AFP

The lawsuit claims that Ben & Jerry’s decision violated the U.S. Export Control Reform Act, which prohibits companies from refusing to do business for boycott-related reasons; the U.S. Tax Code’s reporting requirements for activities related to boycotts; the U.S.-Israel Trade and Commercial Enhancement Act; and numerous state anti-discrimination policies and anti-boycott laws.

The lawsuit also highlights Zinger’s efforts to hire a diverse workforce – including Jews, Muslims, new immigrants and refugees – as well as his own deep investments in programs fostering Israeli-Palestinian coexistence.

At least six states have divested from Unilever since July. Three other states among the 34 with anti-Israel boycott laws on their books have also launched reviews that may eventually lead to divestment.

AQP and Zinger’s lawsuit also cites violation of Israel’s nondiscrimination law, which the Louis D. Brandeis Center for Human Rights Under Law – one of the legal representatives – says prohibits, among other things, discrimination in the furnishing of a product or public service on the basis of race, religion, nationality, place of origin, gender, sexual orientation, age and residence.

In a statement provided by the Brandeis Center, Zinger noted that “for 34 years I have had a strong and incredibly positive working relationship with Ben & Jerry’s, manufacturing and selling its ice cream in all parts of Israel, to Israelis and Palestinians. I refused Ben & Jerry’s and Unilever’s illegal demands, and as a result they are threatening to close my business, affecting hundreds of Israeli and Palestinians workers and distributors.

“Ben & Jerry’s and Unilever’s actions are misguided, unlawful and immoral. Boycotting Israel should come with a heavy price tag and, therefore, we are taking Unilever to court. We expect the court to prevent Unilever from terminating my contract, since the only reason it’s doing so is that I refused to break the law,” he added.

Alyza Lewin, president of the Brandeis Center, said that “Unilever’s unlawful action is detrimental not only to Avi Zinger and his company, but also to Avi’s employees; his Palestinian distributors and suppliers; and the general public.” 

The Ben & Jerry's ice-cream plant in the Be'er Tuvia industrial zone, southern Israel, last July.Credit: Tsafrir Abayov /AP

“Unilever is destroying a successful business that provides jobs for refugees, new immigrants and the disabled; economic opportunity for Palestinians; financial support for Israeli-Palestinian peace and coexistence programs, and education and training for Palestinian students and farmers,” Lewin continued. “Avi’s business makes Ben & Jerry’s available to all consumers throughout Israel – Palestinians and Israelis alike. Unilever is shutting all of this down, only because Avi refuses to agree to its demand that he boycott customers based on where they live – a move which would harm Palestinian consumers most of all.”

She added that “by placing this unlawful demand on Avi, Unilever has breached its contract and opened itself up to public ridicule and sanction. It is time for Unilever to admit the error of its ways and reverse its discriminatory and self-destructive decision.”

Under Unilever’s purchase agreement with Ben & Jerry’s in 2000, the ice-cream manufacturer maintains broad independence over its social justice policies. Unilever has publicly and repeatedly honored that arrangement following the decision by Ben & Jerry’s concerning AQP.

The Brandeis Center’s founder and chairman, Kenneth Marcus, served as assistant secretary of education for civil rights under the Trump administration. He was confirmed in 2018 under heavy scrutiny and did not receive a single vote of Democratic support. Marcus dedicated much of his tenure to focusing on the BDS movement and treating criticism of Israel as antisemitism – including investigating claims of anti-Israel bias as discrimination under Title VI of the Civil Rights Act.

L. Marc Zell, another attorney representing the plaintiffs, is chairman of Republicans Oversees Israel and previously represented plaintiffs who sued Airbnb, alleging that their policy of banning listings from West Bank settlements discriminated against Jews.

Ben & Jerry’s co-founder Ben Cohen has consistently rejected attempts to conflate criticism of Israel with antisemitism as inaccurate and disingenuous. Last summer, when the story broke, he stated that “Israel, most assuredly, has the right to exist. I support it in general; I’m against some of its actions. One of these is oppressing a whole group of people in the occupied territories.”

Also last summer, Ben & Jerry’s board chairwoman Anuradha Mittal defended the company’s decision while arguing that it does not constitute a boycott of Israel. “There was never a discussion on a complete pullout, divestment or boycott of Israel,” she said, calling the right to protest a fundamental American value. “It’s pretty shocking to see American democracy being under threat if it can [come under] this much influence from foreign governments,” she added.

Ben and Jerry's co-founders Jerry Greenfield, left, and Ben Cohen the founders of Ice Cream attending an event on police reform in Washington last May.Credit: Kevin Dietsch / GETTY IMAGES NOR

Mittal’s comments followed the full-throated campaign led by Israel’s then-ambassador to the U.S., Gilad Erdan, who encouraged U.S. governors leading states with anti-boycott laws to take punitive action against Ben & Jerry’s and Unilever.

Following Erdan’s call, most of the U.S. Jewish establishment and pro-Israel organizations similarly applied pressure to Unilever and U.S. governors alike, while progressive Jewish organizations called on states to avoid legal action.

In response to the pressure, Unilever CEO Alan Jope stressed in a July statement that “although the brand will not be present in the West Bank from 2023, it will remain in Israel through a different business arrangement.”

The Brandeis Center dismissed this pledge as disingenuous.

“There is no lawful mechanism by which Unilever can discriminate against customers located in Israel’s territories. Because Israeli laws prohibit discrimination based on residence and boycotts of any part of Israel, no Israeli licensee can accommodate Unilever’s demand to halt distribution in the territories,” the Brandeis Center said.

It added that “Unilever’s boycott therefore amounts to an unlawful boycott of all of Israel. Indeed, soon after Unilever released its statement in July, Ben & Jerry’s board quickly rejected it, implying that the board supports a boycott of all of Israel.”

In recent months, a bipartisan group of House members urged the U.S. Securities and Exchange Commission to probe Unilever, claiming it may have violated the law by not properly disclosing risks to investors. Three Republican members of the Senate Banking Committee have also urged the SEC to probe whether Unilever deliberately misled investors about the move.

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