Target Shareholder Lawsuit & UK Immigration

00:03: A conservative legal group is taking aim at Target, claiming that the company pushed the

00:08: interest of their shareholders aside by marketing LGBT merch in June.

00:13: We break down the case in other similar lawsuits.

00:17: I'm Georgia Howe with Daily Wire Editor-in-Chief John Bickley.

00:21: It's August 12, and this is a Saturday edition of Morning Wire.

00:29: Asylum seekers flowing into the United Kingdom have been put on an offshore barge, as the

00:34: number of migrants has overwhelmed available housing.

00:37: What it sends is a forceful message that there will be proper accommodation, but not luxurious.

00:43: How are locals reacting and how long will the migrants be housed on the ship?

00:48: And the video communication software Zoom stirred up controversy this month when they updated

00:53: their terms of service to include a clause regarding AI.

00:57: I think the line between what they consider their information and what they consider your

01:01: information is really not well-stalled out in terms of service.

01:06: What's behind their customers' anger and how is the company responded?

01:09: Thanks for waking up with Morning Wire.

01:11: Stay tuned.

01:12: We have the news you need to know.

01:18: A conservative legal group is suing target over LGBT merchandise that marketed in June.

01:23: The group claims the company knowingly put political activism ahead of its fiscal duty to shareholders.

01:29: Here to tell us more about the lawsuit is Daily Wire Culture Reporter, Megan Basham.

01:34: So Megan, what exactly are the grounds for the suit?

01:37: Well, you know, most people will probably remember that back in June, Target released a special

01:42: lineup of LGBTQ themed products and that those caused a lot of controversy.

01:47: So the items included tuck-friendly bathing suits, some toddler boardbooks with titles

01:53: like buy, buy, binary. And then this was probably the biggest thing. A quote unquote, queer

01:59: themed clothing and accessories line from a designer who describes himself as a Satanist.

02:04: Well, the backlash to all of that was fierce and target removed some of the items from

02:09: their stock. After that, shares of target really just tanked.

02:14: Now, was the drop in stock definitively linked to that PR issue?

02:18: Well, a lot of legacy media outlets reported that it wasn't due to that.

02:23: They said that broader retail market woes were to blame.

02:27: CNN, for instance, quoted an analyst who said, and I'm quoting here, retail is just very out of favor right now.

02:34: So all the stocks in the sector are overcorrecting.

02:37: The outlet concluded that the cause of the drop was target primary shopping base of middle

02:43: income households have been pinched by rising costs and inflation.

02:48: Now, on the other side of that,

02:49: Smead Capital, which is a prominent investment manager,

02:53: said in its second quarter letter to investors,

02:55: that Target was our worst performer in the quarter,

02:58: primarily driven by customers and public reaction

03:02: to those in-store promotions for the month of June.

03:05: Well, I spoke to one analyst on background who agreed with that.

03:08: He pointed out that Amazon, Walmart, Costco,

03:11: really a number of other major retail stocks

03:14: were moving up just as Target was taking a dive.

03:18: And Target itself was trending up before the Pride controversy.

03:22: So the premise is that the Pride merchandise actually caused the losses

03:26: and that's the basis for the suit.

03:28: Exactly.

03:28: So this suit was filed by America first legal on behalf of shareholders.

03:33: And what they're saying is that in its 2022 and 2023 proxy statements, Target told shareholders that it was monitoring for risks

03:42: that might stem from its social and political messaging.

03:45: This was the group announcing that suit.

03:48: Steven Miller here, president of America First Legal.

03:51: We just filed a federal shareholder lawsuit against Target.

03:55: Following his disastrous pride propaganda that erased billions in shareholder value.

04:01: We are fighting ESG extremism.

04:04: Now in their statement announcing this, they wrote, quoting here,

04:09: management only cared whether it's leftist stakeholders were satisfied.

04:13: Disregarding the possibility that its customers and shareholders might feel differently.

04:18: This predictably caused more than a $12 billion collapse in share value,

04:23: the largest stock price decline in over 20 years.

04:26: Target's management has misled investors, assuring them that the corporation oversees

04:31: social and political issues and risks to protect shareholders.

04:36: Now, what's the likelihood of the suit actually gaining traction?

04:39: Yeah, that's a good question.

04:40: So AFL's president is Trump administration veteran, Stephen Miller.

04:45: So you're certainly hearing a lot of people calling this a political stunt.

04:49: But publicly traded companies are required to disclose certain information in their proxy

04:53: statements so that shareholders will understand the risks that they're running and can make informed decisions.

05:00: Target also has a fiduciary duty to protect shareholders' investments.

05:04: If it knew it was seriously risking that, that really is a legitimate issue.

05:08: And this is kind of a rising trend in attacking ESG policies.

05:12: Starbucks, for instance, saw a similar suit last year.

05:16: The outcome of that one is still pending, and also a good chance that one of these cases

05:21: will end up in front of SCOTUS.

05:23: All right, well, Megan, thanks so much for reporting.

05:26: Anytime.

05:30: Immigrants arriving in the United Kingdom from the English Channel are being put on a large

05:35: barge docked off the coast. The move highlights the growing number of asylum seekers arriving

05:40: in Great Britain and the challenge of housing them. Joining us to discuss is Radha Mir

05:45: Tile Coat Director of Research at the London-based Lagatum Institute. Hello, Radha. So the British

05:51: government has started housing illegal migrants on a barge. First, give us a little background on immigration in the UK.

05:58: Well, just as in America, where there are migrants spilling

06:01: across the southern border in large numbers, the UK has its own

06:05: southern border crisis because thousands of illegal migrants

06:08: or undocumented migrants, as we are now encouraged to call them,

06:13: arrive in the UK from across the English Channel in so-called

06:16: smallboats, which are often not actually that small.

06:20: Now around 46,000 people across the English Channel in smallboats

06:25: in 2022. That's a number that's increased rapidly over recent years. Although they bored

06:30: boats in France, the migrants frequently come from Albania, as well as Iran, elsewhere

06:35: in the Middle East and North Africa. That 46,000 number, of course, may not sound as significant

06:41: as the numbers you see in the States, but keep in mind the UK is only about a fifth of

06:46: the population of the US. So that's a huge challenge to absorb that many arrivals. And

06:52: that brings us to this week. The British government has announced that they will house hundreds

06:57: of male migrants on what has been called a prison barge currently moored on the coast of Dorset in England and Southwest.

07:05: Now in an update to this story, migrants are being temporarily removed from the barge

07:11: because of the discovery of legionella bacteria which can cause legionnaires disease in the

07:16: barge's water supply. Although it has been emphasised that this is simply a temporary

07:21: measure and once this is dealt with, they should be moved back onto the barge.

07:25: Is that to avoid having them come into the country or detain them or is this primarily just a housing arrangement?

07:32: Well, this is essentially an alternative to a hotel because the men on board will be able to leave at any time.

07:38: There are buses every hour to the nearby coastal town of Weymouth.

07:42: If they miss that last bus home, they get free taxis.

07:46: There are other perks to make life on the ship more pleasant.

07:49: free hiking like trips to cricket matches, a gym movie room, 24 hour food service, and

07:55: officials say this will all help them integrate into the local community. The barge itself

08:01: should hold up to 500 men who are awaiting asylum decisions and is meant to cut the number

08:06: of migrants that the government puts up in hotels at the British public's expense. Currently,

08:12: taxpayers are paying £6 million a day to house 51,000 asylum seekers in those hotels.

08:19: So, not cheap. Now, the 500 or so male residents will be sleeping on the ship offshore, but integrating

08:26: into the local community during the day. How do locals feel about that? Well, naturally, they're

08:31: concerned about hundreds of men arriving in their town. One woman who was interviewed by a newspaper

08:37: said that she was nervous being a woman going to the beach with all those men around, but that she

08:42: is afraid she will be called a racist if she voices those concerns. So, really fear of pushing back

08:48: on the policy there. How significant is the broader immigration issue in the UK?

08:54: Actually, I think it's very comparable to the situation in the United States. In the UK,

08:59: under Prime Minister Rishi Sonak, immigration has been rising. Last year, there was net migration

09:04: of over 600,000. And that's to the growing theory of many conservative voters who thought

09:10: that Brexit would reduce migration by bringing national borders back under national control.

09:15: But what's happened is that so far plans to reduce that immigration have been hobbled by

09:21: in the first instance corporate lobbying for continued cheap foreign labour and there's also

09:26: resistance from within the government bureaucracy. And I'm afraid small boat migrants have been

09:31: arrested for rape and other crimes including in those counties along the south coast where they

09:36: land. But addressing that migration has become especially politically fraught as left-wing politicians,

09:42: as well as judges, continue to fight against attempts to stop it.

09:46: Right, we've seen reports to that effect.

09:49: Has the government tried to actively reduce the flow of migrants

09:52: or has everyone who arrives basically accepted?

09:56: Right, so what the government has tried to do is to send small boat migrants to Rwanda for processing.

10:00: And that was based on Australia's successful scheme

10:04: when arrivals were processed on the island of Nauru.

10:07: That strategy was also successful by the way in reducing human trafficking as well.

10:12: Now on Monday night in the UK, lawmakers passed the government's illegal migration bill.

10:17: That will allow for arrivals to be detained and sent to Rwanda or another safe third country.

10:23: But that process was ruled and lawful by the court of appeal.

10:26: So Prime Minister Sonakka said the government will seek to take the case to the UK's Supreme Court.

10:31: So these are strange times indeed.

10:34: Yeah, on both sides of the pond.

10:36: Radamir, thanks for joining us.

10:37: Thank you for having me.

10:38: That was Ratameer Taukot of the Legatim Institute.

10:45: The video meeting platform Zoom caused a stir this month when a change of their terms of service

10:51: left customers outrage that the company was using their face and voice to train AI algorithms.

10:57: Here with more on the scandal and how Americans views toward AI have shifted is Daily Wire

11:02: Senior Editor, Cabot Phillips. So Cabot, this story really blew up earlier this week. Give us

11:07: us in background. Yeah, this is a wild story. So this week, the website stack diary made waves

11:12: after publishing a blog post digging into the terms of service for Zoom, the massively popular

11:17: video conferencing app that went mainstream during COVID lockdowns. While the terms include

11:21: standard language and disclaimers, they also include a number of passages that grant the company

11:25: broad rights to user data, including their images and voices. For example, one portion says Zoom

11:30: has the rights to users quote data, content files, documents, or other materials. But the

11:35: The section that really turned heads says,

11:37: Zoom has a perpetual worldwide royalty-free right to your data for the purpose of product development,

11:42: including, quote, machine learning and artificial intelligence.

11:45: Wow.

11:46: Yeah, you can see why people were spooked

11:48: and wanted to know how exactly their faces might be used to help develop AI.

11:52: Now, the company had actually implemented

11:54: the new terms of service back in March,

11:56: but as we all know, very few people,

11:57: myself included, actually read all the fine print when clicking accept.

12:01: It wasn't until this week that anyone seemed to notice.

12:03: But now that the details of the terms are public, there was understandably mass outrage online with people accusing the company of violating their privacy.

12:11: Right, you can see why.

12:12: Now, tell us how Zoom execs responded to that.

12:15: So they've definitely been on the defensive.

12:17: The company's COO issued a statement saying

12:20: users will be notified when their images

12:21: or audio are being used for, quote, product improvement purposes.

12:25: But that did little to assuage the fears of many users.

12:28: In response, the company went a step further

12:30: adding a new line to their terms of service

12:32: that reads, quote, for AI, we do not use audio, video, or chat

12:36: content for training our models without consumer consent.

12:39: But it's worth noting the carefully-worted language in those revised terms.

12:43: While they do promise not to use audio or video content

12:45: to train their AI models, intellectual property lawyers

12:48: have pointed out that they'll still technically

12:50: be allowed to use a vast trove of other user data.

12:53: While some say it's simply the trade-off

12:54: you make when using high-tech software these days,

12:57: plenty more folks say it's a violation of user privacy.

13:00: This all comes at a time when Americans are increasingly skeptical of AI technology more broadly for this very reason.

13:06: Right, well, there's been some interesting polling on that front.

13:09: Tell us a little bit about that.

13:10: So according to a poll earlier this summer

13:12: from Reuters, 61% of Americans believe AI poses a risk to humanity.

13:17: And there was bipartisan agreement on the issue as well

13:19: with 70% of Republicans and 60% of Democrats expressed in concern.

13:24: And there was also clear consensus across party lines in supportive regulation in the industry,

13:28: just not regulation coming from tech companies themselves.

13:32: 82% say they do not trust AI leaders to self-regulate.

13:35: The majority of Americans say they'd instead prefer government regulation of some kind,

13:39: and they're likely to get their wish.

13:41: Congress has been working feverishly in past months to regulate the industry, expect

13:44: to hear much more on that front in the coming year.

13:47: Well, I'm feeling vindicated, but I refused to download all through the pandemic.

13:52: Cabot, thanks for reporting.

13:53: Anytime.

13:58: That's all the time we've got this morning.

13:59: Thanks for waking up with us.

14:00: We'll be back this afternoon with an extra edition of Morning Wire.