The US state of Florida has initiated a lawsuit against US retail giant Target, claiming that the company’s misrepresentation of its diversity and social initiatives led to significant financial losses for shareholders.
The lawsuit, lodged in the federal court in Fort Myers, was filed by the State Board of Administration of Florida on 20 February 2025.
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It claims that Target breached Sections 10(b) and 14(a) of the Securities Exchange Act of 1934. The State Board of Administration of Florid is represented by Florida Attorney General James Uthmeier and America First Legal.
The plaintiff state that they are holding Target accountable for violating federal law, deceiving investors and prioritising activism over financial responsibility to shareholders.
The complaint accuses Target of not disclosing the potential risks of customer backlash related to its diversity, equality and inclusion (DEI) initiatives, which led to the controversial 2023 Pride campaign, as well as its environmental, social and governance (ESG) policies.
After the launch of the 2023 Pride campaign, the company’s stock price dropped significantly losing $10bn in market value within ten days and a total of $25bn in shareholder value over six months – its worst performance and longest losing streak in 23 years.
The class action further accuses Target of misleading investors by asserting that it was monitoring the social and political risks associated with its DEI and ESG initiatives, when in fact, it was primarily tracking its alignment with left-wing activist groups.
James Uthmeier said: “Corporations that push radical leftist ideology at the expense of financial returns jeopardise the retirement security of Florida’s first responders and teachers. My office will stridently pursue corporate reform so that companies get back to the business of doing business — not offensive political theatre. We appreciate America First Legal’s assistance in the fight to keep Florida’s investments safe.”
On 24 January 2025, Target announced plans to discontinue DEI initiatives within the year, joining other major companies such as Walmart and Amazon in scaling back such programmes.
These moves come amid criticism from former US President Donald Trump and other conservatives regarding corporate DEI efforts.
