Target is facing a class action suit over alleged misleading statements regarding its Environmental, Social, and Governance (ESG) and Diversity, Equity, and Inclusion (DEI) initiatives.
The defendants in the case also include Target CEO Brian Cornell and current and former members of the company’s board of directors.
The suit, filed by institutional investor City of Riviera Beach Police Pension Fund, alleges that the retailer defrauded investors by issuing false and misleading statements concerning certain conduct undertaken pursuant to its ESG and DEI mandates.
It is on behalf of all persons or entities who purchased or acquired Target common stock from August 26, 2022 through November 19, 2024.
The complaint states that investors purchased the company’s stock at “artificially inflated” prices and did not receive any warnings about the risks associated with the ESG and DEI initiatives.
In May 2023, Target faced customer backlash from LGBT-Pride Campaign, which later led to a drop in sales and falling stock prices.
Widespread consumer boycotts and news related to their growth continued from June 2023 into 2024 causing further stock price declines and additional damages.
The risks associated with the campaign further materialized in November last year when the company announced a 11.9 per cent drop in earnings, the suit highlights.
As of November 20, Target stock fell to a close of $121.72, a decline of 22 per cent.
