Jane Fonda has stood with North Vietnam and against the war in Iraq. But Israel proved a protest too far as the actor and activist backed away from a bitter dispute among Hollywood names over a film festival that has been variously branded as an Israeli propaganda stunt or a showcase for the achievements of the Jewish state.

Jerry Seinfeld, Sacha Baron Cohen, Lenny Kravitz and Natalie Portman are among those who have put their names to an open letter denouncing a campaign against the Toronto film festival’s spotlight on Tel Aviv to mark the Israeli city’s centenary. One Oscar-winning producer has gone so far as to describe the campaign as intended to destroy Israel.

But backers of the protest against the celebration of Tel Aviv — who include Ken Loach, Julie Christie and Harry Belafonte — say the organisers have been duped into joining a propaganda campaign after a senior Israeli diplomat in Canada said he was targeting the film festival as part of a multimillion—dollar push to improve the Jewish state’s image abroad.

Fonda was among hundreds of artists and activists who put their names to an open letter to the Toronto International Film festival (TIFF), objecting to Tel Aviv being chosen as the first of its “city to city” showcases. A Canadian director pulled his documentary in protest, and two Egyptian films were withdrawn.

TIFF has denied it is being used, and said Tel Aviv was selected because, like Toronto, it is a diverse metropolis. But the open letter, known as the “Toronto declaration”, says that to celebrate Tel Aviv without talking about occupation or this year’s bloody attack on Gaza is “like rhapsodising about the beauty and elegant lifestyles in white—only Cape Town or Johannesburg during apartheid without acknowledging the corresponding black townships of Khayelitsha and Soweto”.

“We do not protest the individual Israeli film—makers included in city to city, nor do we in any way suggest Israeli films should be unwelcome at TIFF. However, in the wake of this year’s brutal assault on Gaza, we object to the use of such an important festival to stage a propaganda campaign on behalf of what South African Archbishop Desmond Tutu, former US president Jimmy Carter, and UN General Assembly president Miguel d’Escoto Brockmann have all characterised as an apartheid regime,” the protest letter says.

Among those endorsing the declaration are the actors Danny Glover, the musician David Byrne and the writer Alice Walker. The activists Naomi Klein and Noam Chomsky have also backed it.

The declaration notes that last year the Israeli government and three major Canadian media companies launched a multimillion—dollar “Brand Israel” campaign to “take the focus off Israel’s treatment of Palestinians and its aggressive wars, and refocus it on achievements in medicine, science and culture”.

It also points to an interview by the Israeli consul general in Canada, Amir Gissin, in which he said that Toronto had been chosen as a test city by the Israeli foreign ministry to rebrand the Jewish state abroad, and boasted that he would use the film festival as part of the campaign.

“I’m confident that everything we plan will happen,” Gissin told the Canadian Jewish News.

Klein says that Gissin has got his way and that the TIFF organisers have been duped into playing along with the Israeli government’s desire to portray the country as a tolerant liberal democracy.

The protest is also supported by some prominent Israelis, including the film—maker Udi Aloni, who wrote an open letter to other Israeli directors saying he is concerned about the showing of their films at the festival. “You are becoming ambassadors, or PR spokesmen, for the state, blurring the wrongs of the occupation, by imbuing Israel with a liberal scent ... You might ... find yourself participating in the dirty job of branding Israel as a hip western democracy,” he said. “Are you with us or with the Israeli ministry of foreign affairs? ... I am afraid that nowadays one cannot belong on both sides.” Pro—Israel organisations in Los Angeles and Toronto won support from a number of Hollywood names — including Lisa Kudrow, Adam Arkin, Jason Alexander and Baron Cohen, who has family in Israel — for a petition headed: “We don’t need another blacklist”.

“Anyone who has actually seen recent Israeli movies ... knows they are in no way a propaganda arm for any government policy,” it says. “Blacklisting them only stifles the exchange of cultural knowledge that artists should be the first to defend.” Rabbi Marvin Hier, who has won two Oscars as a producer of documentaries about the Holocaust, and who founded the Simon Wiesenthal Centre, has accused signatories of the Toronto declaration of not supporting a two—state solution. “By calling into question the legitimacy of Tel Aviv, they are supporting a one—state solution, which means the destruction of the state of Israel,” he said.

The declaration’s organisers say their petition is being distorted in order to discredit it. That did not stop Fonda from changing her mind and backing away from it on the grounds that it was “unnecessarily inflammatory” because it didn’t mention Hamas and other issues. “I signed the letter without reading it carefully enough, without asking myself if some of the wording wouldn’t exacerbate the situation rather than bring about constructive dialogue,” Fonda wrote on huffingtonpost.com.