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Target (TGT-2.71%) was hit with another lawsuit on Thursday, this time by the state of Florida, which accused the retail giant of hiding the risks tied to its diversity, equity, and inclusion (DEI) efforts. The state claims these initiatives sparked a customer backlash that erased billions of dollars from Target’s market value.
The lawsuit, filed in federal court in Fort Myers, Florida, was brought by the State Board of Administration of Florida, an agency responsible for managing public pension funds, which hold Target stock.
Florida alleges that Target misled investors and alienated its core customer base by making false and misleading statements in its financial reports about its DEI and environmental, social, and governance (ESG) mandates. The lawsuit also targets Target CEO Brian Cornell, accusing him of downplaying the scope of customer boycotts following the company’s Pride Month campaign in May 2023. The state claims these boycotts contributed to a prolonged decline in Target’s share price.
Target did not immediately respond to requests for comment.
The lawsuit is being represented by Florida Attorney General James Uthmeier and America First Legal, a group led by President Donald Trump’s advisor, Stephen Miller.
“Corporations that push radical leftist ideology at the expense of financial returns jeopardize the retirement security of Florida’s first responders and teachers,” Uthmeier said in a statement. “My office will stridently pursue corporate reform so that companies get back to the business of doing business — not offensive political theatre.”
This is America First Legal’s second lawsuit against Target. Earlier this month, the City of Riviera Beach Police Pension Fund in Florida filed a similar lawsuit.
The legal actions come as Target, along with other major corporations such as Walmart (WMT-2.44%), McDonald’s (MCD+0.64%), and Meta (META-1.66%), have recently scaled back their DEI initiatives.