On July 20, trucks parked at Ben & Jerry’s ice cream factory in Israel’s Be’er Tuvia industrial estate. Arizona sold Unilever bonds because the Ben & Jerry’s subsidiary decided to stop selling its ice cream in Israeli-occupied territories. Tsafrir Abayov / AP Hide caption
Tsafrir Abayov / AP
Tsafrir Abayov / AP
PHOENIX – Arizona has Unilever bonds worth 93 million in series of actions by states with anti-Israel boycott laws.
The investment moves state Treasurer Kimberly Yee announced this week was mandated by a 2019 state law that prohibits Arizona government agencies from making investments or doing more than $ 100,000 in business with companies that are Israel or boycott their territories.
Arizona appears to be the first of 35 states with anti-boycott laws or regulations to completely split from Unilever following the actions of Ben & Jerry. Illinois warned the company in July that it would have 90 days after the investment board meeting to change course or it would sell. Florida and other states have taken similar action, according to the IAC For Action, the political and legislative arm of the Israeli-US council.
Ben & Jerry’s, based in Vermont, is owned by London-based Unilever, but has its own independent board of directors, which Unilever says makes its own decisions about its social mission. Ben & Jerry’s announced on July 19 that maintaining its presence in the Occupied Territories was “inconsistent with our values”.
The Ben & Jerry decision sparked a violent reaction from Israel, which promised to “act aggressively” in response to the move, including calling on US governors to punish the company under anti-boycott laws. Arizona and 34 other states have laws against boycotting Israel.
US groups in support of Israel are divided over whether it is appropriate to sideline Unilever for Ben & Jerry’s decision. The Israeli-American Council urged governors to act through IAC For Action.
State Senator Kimberly Yee then watches a vote take place at the Phoenix Capitol in 2016. Yee, who is now the state’s treasurer, announced this week that Arizona sold $ 93 million in Unilever bonds and plans to sell the remaining $ 50 million it has invested in the global consumer goods company. Bob Christie / AP hide caption
Bob Christie / AP
Bob Christie / AP
IAC for Action Director Joseph Sabag called boycotts against Israel anti-Semitic and said it was important to fight them at the state level.
“The Israeli-American community is sensitive to this, because I would say that more than other parts of the Jewish-American community we have experienced the national aspect of anti-Semitism in a more pronounced manner,” said Sabag on Friday. “So we are really very proactive. It is our children who are affected by it in the classrooms and who are afraid and intimidated and feel harassed. … That is definitely our community’s interest in this matter.”
But the head of J Street, a Washington DC-based pro-Israeli organization that supports a two-state solution, backed Ben & Jerry’s decision, saying the company’s punishment was “seriously dangerous.”
“It is not anti-Semitic to criticize Israeli politics or not to sell ice cream in illegal settlements,” tweeted President Jeremy Ben-Ami in July. “It’s actually a really pro-Israel decision.”
The anti-boycott laws are being challenged in courts, as was the case in Arizona after it was passed in 2016. A Flagstaff attorney with a contract to defend detainees in custody sued under the First Amendment that the law violated his right to freedom of expression.
A U.S. district judge in Arizona blocked enforcement during the trial, but lawmakers changed the law to only apply to contracts worth more than $ 100,000, effectively ending the trial as it was for the Flagstaff man no longer applied. The state was asked to pay $ 115,000 for its legal fees.
In Arkansas, the editor of a weekly newspaper sued the state’s law for similar reasons. A trial judge dismissed the case, ruling that “boycotting Israel is neither speech nor inherently expressive behavior,” which is protected by the First Amendment. But a divided three-member panel of the US 8th Court of Appeals revived the Arkansas Times lawsuit in February, ruling that “supporting or promoting boycotts against Israel is constitutionally protected … protected activity.”
The verdict is not the last word: in June, 8th district judges agreed to hear the case and overturned the decision of the three-judge panel. You should hear arguments on the case later this month.
Both cases were filed by the American Civil Liberties Union.
Meanwhile, in Arizona, Yee wrote to Unilever’s Investor Relations Department on September 2 to inform the company that while Ben & Jerry’s is independently run, Arizona law would require them to sell Unilever assets if the Decision would not be overturned.
“I have given Unilever PLC, the parent company of Ben & Jerry’s, an ultimatum: reverse Ben & Jerry’s action or part ways with Ben & Jerry’s to comply with or face the consequences of Arizona law,” said Yee, one Republicans running for governor said in a statement. “You chose the latter.”
Unilever said in an Aug. 2 letter to Assistant Treasurer Mark Swenson that it has never endorsed boycotts of Israel, commonly referred to as boycott-divestment sanctions or BDS, but that Ben & Jerry’s operate independently. The company had no additional comment.
Investments in Arizona were in bonds and commercial papers held in the state’s short-term fixed income mutual fund.
The Arizona law, enacted in 2016 and revised in 2019, had broad, non-partisan support and was signed by Republican Governor Doug Ducey. He tweeted that Ben & Jerry’s decision was “discrimination”.
“Arizona will not do business with a company that is boycotting Israel – in 2016 and 2019 I signed bills to ensure it did,” the tweet said. “Arizona stands on the side of Israel.”