Ben & Jerry’s is suing its proprietor, the shopper merchandise large Unilever, in an ordinary case that seeks to forestall Unilever from promoting the distribution rights of the ice cream logo in Israel to a neighborhood licensee.
Final yr, Ben Cohen and Jerry Greenfield, the founders of the corporate well-known for its stances on hot-button problems, mentioned they might finish gross sales in Israeli-occupied territories. The licensee is predicted to proceed promoting Ben & Jerry’s in the ones spaces.
The rift between Ben & Jerry’s and Unilever dates to Unilever’s acquisition of the ice cream logo in 2000, the DealBook publication experiences. As a part of that deal, Unilever agreed to let Ben & Jerry’s impartial board, of which Unilever appoints simplest two out of the 11 seats, proceed to supervise the logo and its symbol.
The ordinary association gave the founders persevered keep an eye on regardless of the sale in their corporate. Normally, shareholders vote in elections for the board. However this contract is between Unilever and Conopco, which is formally the one shareholder of Ben & Jerry’s. Conopco is obliged to vote for the founders’ board selections and their successors, who’re additionally named via Ben & Jerry’s board.
Unilever is in a position to select the logo’s leader govt, which is one thing a board most often does, however even that individual is meant to defer to Ben & Jerry’s impartial board in relation to keeping up “the social accountability facets of the corporate,” Ann Lipton, a professor in trade regulation at Tulane College Legislation College who has studied the purchase, instructed DealBook.
However Unilever seems to have a conceivable out, Ms. Lipton mentioned. The contract itself is probably not enforceable in courtroom. Historically, a freelance is between two events. On this case, the settlement can have been between Unilever and Ben & Jerry’s founders, but it surely’s no longer, she mentioned.
“That’s like having a freelance with your self,” Ms. Lipton instructed DealBook. “In the event you’re the one shareholder of the corporate, the concept the corporate could make a freelance with you is kind of unheard-of. It’s very extraordinary.”
She mentioned she hadn’t heard of a equivalent case, including, “It’s a case learn about in trade regulation elegance.”