The state of Florida has filed a securities fraud lawsuit against Target Corp (TGT.N), accusing the retailer of misleading investors about the risks associated with its diversity, equity, and inclusion (DEI) initiatives. The lawsuit, brought by the State Board of Administration of Florida, was filed in the U.S. District Court in Fort Myers.
Florida claims that Target concealed the financial risks of its DEI policies and environmental, social, and governance (ESG) initiatives, leading to a consumer backlash that significantly hurt its market value. The suit also alleges that CEO Brian Cornell downplayed the impact of customer boycotts following the company’s controversial May 2023 Pride Month campaign.
Following the backlash, Target removed some LGBTQ-themed merchandise due to safety concerns for employees, but its stock continued to decline. Since its peak in November 2021, Target’s share price has dropped by over 50%, including a steep 22% fall in November 2024 that erased $15.7 billion in market value.
In response to mounting pressure, Target announced on January 24, 2025, that it would end its DEI initiatives, following the lead of Walmart, Amazon, and other major corporations that have recently scaled back similar programs.
Florida’s lawsuit is the first state-led shareholder action against Target on DEI-related grounds and joins two similar lawsuits filed in 2023 and January 2025. The case is State Board of Administration of Florida v. Target Corp et al., U.S. District Court, Middle District of Florida, No. 25-00135.
