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Plaintiffs say the city’s policy unlawfully mandates divestment based on ideology.
Two Jewish advocacy organizations have filed a federal lawsuit challenging Medford’s recent values-based investment ordinance, arguing the policy illegally forces the city to divest public funds for political and ideological reasons.
The Gevura Fund and the National Jewish Advocacy Center, along with the law firm Libby Hoopes Brooks & Mulvey, P.C., filed the lawsuit in U.S. District Court in Massachusetts last week, seeking to block enforcement of the ordinance.
The ordinance restricts the city from investing taxpayer funds in companies tied to categories such as fossil fuels, defense contracting, or alleged human rights violations, and applies to general city funds, including pension-related assets. Medford became the first municipality in Massachusetts to adopt such a policy when the city council approved the measure last year. Only two other U.S. municipalities — Dearborn, Michigan, and Portland, Maine — have enacted similar ordinances.
According to the complaint, the policy conflicts with federal and state law and violates Massachusetts investment rules that require municipal officials to prioritize liquidity and financial returns. The lawsuit argues that replacing financial standards with subjective criteria opens the door to political bias and reduced returns for taxpayers.
“We know the movement to pass these legally defective divestment ordinances nationwide are motivated by anti-Jewish animus, but that’s not what this lawsuit is about,” said Rachel Sebbag, litigation counsel at NJAC and the Gevura Fund, in a press release.
“As a clear matter of constitutional law, these ordinances cannot stand. Rogue activist city councils must not be allowed to trample taxpayer rights,” Sebbag continued.
Medford city officials did not respond to a request for comment on the lawsuit by publication time.
Supporters of the ordinance have framed it as an effort to align public investments with ethical values.
During a city council meeting in August, Medford City Council President Isaac Bears, who sponsored the ordinance, said “If we have these public funds, we are not going to invest them in this global effort that disregards and dehumanizes people in so many different ways, whether that’s for political gain or for private profit – or in many cases both – in a never-ending cycle of destruction and violence.”
At that meeting, the city council voted to approve the ordinance, though Medford’s mayor vetoed it in October over legal and financial concerns. City council overrode the veto the following month, finalizing the measure as part of the city’s investment policy, according to The Tufts Daily.
Read More: Jewish groups sue Medford over values-based investment ordinance
