Connect with us

Politics

DeSantis eyes lawsuit over Bud Light’s deal with trans influencer. Experts are skeptical.

Sources agree company was acting in its best interests

Published

on

Florida Gov. Ron DeSantis (Screen capture/CNN)

As sales continue to slump after months of conservative backlash against Bud Light’s social media spot with trans influencer Dylan Mulvaney, Florida Gov. Ron DeSantis (R) announced he will explore a potential lawsuit against the beer brand’s parent company, Anheuser-Busch InBev.

“It appears to me that AB InBev may have breached legal duties owed to its shareholders,” DeSantis said in a letter shared on Twitter Friday outlining possible grounds for legal action on behalf of the shareholders of Florida’s pension funds.

Columbia University Law School Professor John Coffee, however, told the Washington Blade a legal doctrine called the business judgment rule “fully protects the board of Anheuser-Busch InBev from any liability for breach of fiduciary duty that might be asserted by Florida’s pension funds in a derivative suit.”

Caselaw directs courts to uphold decisions by company directors provided they are made in good faith, with the care expected of a reasonably prudent person, and with the reasonable belief that they were acting in the corporation’s best interests.

Multinational drink conglomerate AB InBev suffered financially as a result of Bud Light’s promotion with Mulvaney, with sales for the brand down 25 percent from last year according to market research data reported by CNBC.

“No doubt, Anheuser-Busch lost money because of the populist reaction to the use of a transgender ‘influencer,’ but that is not the standard for liability,” said Coffee, who is recognized as one of the country’s leading experts in securities law, corporate governance, white collar crime, complex litigation, and class actions.

Directors “were seeking to promote their product with a new audience, and it backfired, but that is not a breach of duty,” he said, adding, “Management has the legal right to innovate and try new tactics.”

Andrew Isen, founder and president of WinMark Concepts, agreed, telling the Blade, “Bud Light is an entry beer because of the price point,” so it made sense for the beer maker to target the younger demographics who comprise the influencer’s sizable online following.

“No one foresaw this backlash,” he said.

“They’re making business decisions, they’re making marketing decisions, to grow their business, and that’s what their responsibilities to their shareholders are,” said Isen, whose clients are mostly large publicly traded corporations.

Additionally, he said, partnering with an LGBTQ public figure like Mulvaney makes sense from a market research perspective.

For instance, Isen pointed to data from management consulting firm McKinsey & Co., which found that “for five years, our research has shown a positive, statistically significant correlation between company financial outperformance and diversity, on the dimensions of both gender and ethnicity.”

Coffee, who has repeatedly been listed among The 100 Most Influential Lawyers in America and topped rankings of the most-cited scholars in corporate and business law, told the Blade he is not aware of any previous cases in which a firm’s marketing or advertising decision provided grounds for shareholder litigation for breach of fiduciary duty in a derivative suit.

“I do not know if litigation will be brought,” he said, adding, “this sounds more like a political stunt.”

If DeSantis’s probe leads to an actual complaint on behalf of shareholders, Coffee said, “I would not expect it to survive a motion to dismiss in Delaware,” if AB InBev is headquartered in the state, where most commercial disputes are adjudicated.

“But the suit might be brought [improperly] in Florida,” Coffee said, “and anything might happen there.”

Regardless, Coffee said, “Gov. DeSantis will make no friends in the business community with these over broad attacks.”

DeSantis, addressing shareholders of his state’s pension funds, wrote in his letter on Friday that, “We must prudently manage the funds of Florida’s hardworking law enforcement officers, teachers, firefighters, and first responders in a manner that focuses on growing returns, not subsidizing an ideological agenda through woke virtue signaling.”

AB InBev is just the latest target of the governor’s crusade against “wokeism” in corporate America, a battle that his party is increasingly waging against companies’ environmental and social governance policies, their diversity, equity, and inclusion initiatives, and their criticism of conservative policies or policymakers.

Firms like Blackstone had come to understand concepts like responsible environmental stewardship and diversity in corporate boards of directors as intrinsic values that are good for business and “integral to their shareholders,” Isen said, referring to the investment management juggernaut that boasts more than $991 billion in assets under management.

However, as these moves come under fire from various factions on the right — intimidation by elected leaders, coordinated online attacks, incendiary coverage in partisan media — the business community is taking notice. Isen pointed to “the amount of companies that are getting rid of their diversity officers,” as reported last week in The Wall Street Journal.

This “noise,” Isen said, is “scaring companies to death.”

Other state officials have recently weaponized the power of their governments against companies over their support for the LGBTQ community. On July 5, seven Republican state attorneys general issued a letter to Target Corp. notifying the retailer that certain merchandise in its seasonal Pride collection may violate their obscenity statutes.

The popularity of DeSantis’s attacks on “woke” corporations will soon be tested as the governor heads into Republican primary races in hopes of securing his party’s nomination for the 2024 presidential election.  

DeSantis’s office did not respond to written questions or provide comment for this story.

Advertisement
FUND LGBTQ JOURNALISM
SIGN UP FOR E-BLAST

Congress

House GOP sinks their own spending bill, Dems object to anti-LGBTQ riders

Vote was 216-212

Published

on

U.S. Capitol
U.S. Capitol (Washington Blade photo by Michael Key)

A group of four hardline House Republicans on Thursday joined Democratic colleagues to sink their own spending bill, a $886 billion military appropriations package full of riders from GOP members that include anti-abortion and anti-LGBTQ provisions.

The 216-212 vote raised the likelihood of a government shutdown if lawmakers are unable to forge a path forward before the end of September.

“Instead of decreasing the chance of a shutdown, Speaker McCarthy is actually increasing it by wasting time on extremist proposals that cannot become law in the Senate,” Senate Majority Leader Chuck Schumer (D-N.Y.) said.

His counterpart in the House, Speaker Kevin McCarthy (R-Calif.), expressed frustration with his own caucus, characterizing the impasse he has reached with colleagues as “frustrating in the sense that I don’t understand why anybody votes against bringing the idea and having the debate.”

“And then you got all the amendments if you don’t like the bill,” he continued. “This is a whole new concept of individuals that just want to burn the whole place down — it doesn’t work.”

A group of 155 House Democrats on Thursday issued a letter objecting to anti-LGBTQ provisions in the bill, the 2024 National Defense Authorization Act, addressing the message to U.S. Sens. Jack Reed (D-R.I.) and Roger Wicker (R-Miss.), chair and ranking member of the Senate Armed Services Committee, and U.S. Reps. Mike Rogers (R-Ala.) and Adam Smith (D-Wash.), chair and ranking member of the House Armed Services Committee.

The effort was led by Congressional Equality Caucus Chair U.S. Rep. Mark Pocan (D-Wis.) and the co-chairs of the Caucus’s Transgender Equality Task Force, U.S. Reps. Sara Jacobs (D-Calif.) and Pramila Jayapal (D-Wash.).

Specifically, the letter argues several anti-equality amendments would “actively target LGBTQ+ service members and LGBTQ+ dependents and threaten the recruitment, retention, and readiness of our Armed Forces.”

Among these are riders prohibiting coverage of gender affirming healthcare interventions for service members and their dependents; banning LGBTQ Pride flags, drag shows and other events; and restricting funding for certain books in schools operated by the Department of Defense Education Activity.

Continue Reading

Congress

Senate confirms federal judge who fought for marriage equality as a lawyer

Three Republicans voted for Rita Lin’s nomination

Published

on

Judge Rita Lin (Photo credit: University of California, San Francisco School of Law)

The U.S. Senate on Tuesday voted 52-45 to confirm Rita Lin’s nomination by President Joe Biden to serve as a judge on the U.S. District Court for the Northern District of California.

The first Chinese American woman to serve in the role, Lin previously fought for marriage equality as an attorney in private practice with the multinational firm Morrison and Foerster.

As co-counsel in a 2012 case challenging the Defense of Marriage Act in federal court, she secured the first ruling striking down the law, which proscribed marriage as exclusively heterosexual unions, since President Obama announced his administration would no longer defend it.

The Senate’s vote to confirm Lin was supported by all present Democratic members and three Republicans: U.S. Sens. Susan Collins (Maine), Lindsey Graham (S.C.) and Lisa Murkowski (Alaska).

Last year, during hearings for her nomination in the U.S. Senate Judiciary Committee, Sen. John Kennedy (R-La.) objected to an article she wrote in 1998 while a junior at Harvard University calling members of the Christian Coalition “bigots.”

The Christian Coalition was founded by the late Christian media mogul Pat Robertson, who attracted controversy throughout his life and career for making sexist, homophobic and racist remarks.

Lin was appointed as a judge in the San Francisco Superior Court in 2018, and she currently presides over felony and misdemeanor criminal trials. She previously served as an Assistant United States Attorney in San Francisco.

Continue Reading

Politics

Wexton, ardent LGBTQ ally, will not seek re-election

Congresswoman diagnosed with progressive supranuclear palsy

Published

on

U.S. Rep. Jennifer Wexton (D-Va.) and Virginia Del. Danica Roem (D-13) (Photo courtesy of Danica Roem)

U.S. Rep. Jennifer Wexton (D-Va.) announced on Monday she will not seek reelection after receiving a diagnosis of progressive supranuclear palsy, a neurological disorder that the congresswoman described in a statement as “Parkinson’s on steroids.”

“I’m heartbroken to have to give up something I have loved after so many years of serving my community,” she said. “But taking into consideration the prognosis for my health over the coming years, I have made the decision not to seek reelection once my term is complete and instead spend my valued time with Andrew, our boys, and my friends and loved ones.”

A vice-chair of the Congressional Equality Caucus who was formerly a co-chair of its Transgender Equality Task Force, Wexton has been a staunch ally of the LGBTQ community since her first election to Congress in 2018 and during previous five-year tenure in the Virginia State Senate.

“.@RepWexton is a strong ally to LGBTQI+ people,” the Caucus posted on X. “We extend our support to her & her family during this time and thank her for championing LGBTQI+ equality.”

“On my lowest days, she’s quite literally been a shoulder to cry on, and on my best days, she was the second person I told about my engagement last year,” Virginia Del. Danica Roem (D-13) told the Washington Blade on Monday.

The congresswoman is “a role model, mentor and genuine public servant whose friendship and advocacy means the world to me,” said Roem, who is the first openly trans representative to serve in any state legislature and will be the first in Virginia’s State Senate if she is elected to the newly drawn 30th district seat next year.

“I spent so many years closeted in part because of the fear and loathing perpetuated by elected officials toward LGBTQ people in Northern Virginia broadly and greater Prince William [County] specifically that made for a hostile, unwelcoming environment,” she said.

“To go from that to having such outspoken, fearless representation from my member of Congress in Rep. Jennifer Wexton hasn’t so much been a breath of fresh air as much as a completely new biosphere,” Roem said.

She added, “I’m so grateful to her for everything she’s done and the example of inclusivity she’s set for her constituents.”

Roem pointed the Blade to an article in the Washington Post entitled, “How Jennifer Wexton became the ‘patron saint of the transgender community,’” which details the ways in which LGBTQ rights “with an emphasis on the transgender community” had become Wexton’s “signature issue” just “six months into her first term.”

In fact, on the day she took office, the congresswoman became only the second member to fly a transgender Pride flag outside her office.

Equality Virginia, the state’s largest LGBTQ advocacy group, also noted Wexton’s advocacy for the community in a post Monday on X: “Thank you @RepWexton for being a tireless advocate for LGBTQ+ people in the General Assembly and in Congress.”

“You’ve made our commonwealth a better place,” the group wrote, adding, “we’re sending our love and strength to you, your family and your entire team.”

“In 2018, this state senator I called my legislative role model and looked up to so much as a first-year delegate, came over for dinner crepes to share her wisdom, humor and guidance,” Roem said on X. “Five years later, Rep. @JenniferWexton is still a mentor, friend and champion for NOVA.”

The Washington Post reported Wexton’s planned departure means her seat representing Virginia’s 10th Congressional District could be vulnerable in next year’s elections, as it was held by Republicans for 40 years prior to the congresswoman’s defeat of GOP incumbent Barbara Comstock in 2018.

Continue Reading
Advertisement
Advertisement

Sign Up for Weekly E-Blast

Follow Us @washblade

Advertisement

Popular