Target’s DEI Rollback Sparks Shareholder Lawsuit and Consumer Backlash
For years, Target has been a retail haven for many Black women—a reliable go-to for everything from stylish home décor to exclusive collaborations with brands like Tabitha Brown and The Lip Bar. These partnerships and Target’s public embrace of diversity made it feel like a brand that understood its customers. It wasn’t just another retailer; it was one that supported minority-owned businesses and championed inclusivity.
But today, Target finds itself in turmoil. As news spreads about the company rolling back its Diversity, Equity, and Inclusion (DEI) initiatives, Black women—some of the brand’s most loyal customers—are left wondering if those beloved partnerships are now at risk. At the same time, a loud consumer boycott has been launched, fueled by civil rights activists who feel the rollback is a betrayal of Target’s inclusive promises.
Amid this backlash, Target now faces a shareholder lawsuit that could have significant financial implications. Accusing the company of failing to disclose the risks of its social initiatives, the lawsuit marks a turning point for a brand caught between its inclusive past and a new, more uncertain future.
The Shareholder Lawsuit: A Legal Storm
The lawsuit was filed on February 3, 2025, by the City of Riviera Beach Police Pension Fund, which represents Target shareholders. The plaintiffs allege that Target failed to disclose the risks associated with its DEI and social initiatives, particularly the potential for consumer boycotts and backlash from controversial campaigns such as its May 2023 Pride Month collection.
According to court documents, the lawsuit claims that Target’s leadership concealed these risks, misleading investors and causing significant financial losses. Shareholders who purchased Target stock between August 26, 2022, and November 19, 2024, experienced steep losses when the company’s stock price dropped 22% on November 20, 2024, wiping out approximately $15.7 billion in market value.
At the heart of the lawsuit is a question of transparency: Did Target knowingly downplay the risks associated with its DEI programs to maintain investor confidence? The plaintiffs argue that the company failed in its fiduciary duty by not being upfront about the potential fallout. Now, shareholders are seeking damages for their financial losses, claiming that the stock price decline could have been avoided if Target had been honest about the risks.
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Financial Fallout and Consumer Backlash
The financial consequences of this crisis are undeniable. The lawsuit points to Target’s May 2023 Pride Month campaign as a key trigger for consumer backlash. Conservative groups launched highly visible boycotts, accusing Target of pushing a social agenda. This controversy sent shockwaves through the market, and by November 2024, the company’s stock had taken a significant hit.
In response, Target quietly scaled back some of its DEI efforts, further fueling speculation about the company’s changing priorities. The Lip Bar, a Black-owned beauty brand that flourished in Target’s inclusive retail environment, and Tabitha Brown’s collection, once prominently featured in stores, now seem caught in the crossfire. Activists and loyal customers alike are asking: What does this mean for the future of Black-owned brands at Target?
On February 1, 2025, civil rights activists launched a nationwide boycott, accusing Target of abandoning its commitment to inclusion and diversity. The boycott quickly gained traction, with DEI supporters demanding that the retailer recommit to its original values. The growing movement has intensified pressure on Target’s leadership as the company tries to navigate an increasingly divided consumer base.
Target is now at a critical crossroads. It must contend with two major challenges: the ongoing shareholder lawsuit and the consumer boycott that threatens its reputation and bottom line. Target has not reinstated its DEI programs on its website or in its corporate practices. The retailer's recent decisions have also led to public dissent, including a protest outside its Minneapolis headquarters and the loss of long-standing partnerships, such as with Twin Cities Pride. These developments highlight the complex landscape companies navigate when balancing DEI commitments with external pressures.