The battle between McDonald’s Corp. and its former chief executive, Steve Easterbrook, continued Monday with the chain calling the fired CEO a liar and ‘morally bankrupt’ for denying wrongdoing in what the chain is calling a deceitful coverup of sexual relationships with other employees.
“When McDonald’s investigated, its CEO lied,” the company said in a legal response filed Monday, Aug. 31, in the Delaware Court of Chancery. “Steve Easterbrook conceded having an intimate relationship with one employee, entirely by phone, but said he never had a sexual relationship with any other employee. That was untrue, multiple times over.”
Back in October, when the company first investigated Easterbrook’s conduct, the burger giant said he deleted emails and photos from his company phone to cover up these additional relationships with three subordinates. The company didn’t discover the alleged coverup until July, prompting McDonald’s to file a lawsuit.
Easterbrook has argued that he is “excused from lying” to the company because McDonald’s had access to his deleted phone data on company servers, according to Monday’s court filing.
McDonald’s said Easterbrook’s argument that he is not liable because he “did not hide his misconduct well enough” is meritless.
“His argument that he should not be held responsible for even repeated bad acts is morally bankrupt and fails under the law,” the company said.
Easterbrook's attorney Daniel Herr could not be reached for comment.
The latest salvo comes a week after the chain acknowledged that it was expanding its probe of Easterbrook, who was fired last November for having a consensual relationship with an employee.
At the time, the Board agreed to a substantial severance plan that it now wants to recoup.
In a statement, the company said Easterbrook violated the chain’s policies, disrespected its values and abused the trust of his co-workers, McDonald’s operators, as well as the board and shareholders.
“If the independent directors had known the full extent of this misconduct, they would not have approved the separation agreement and would have terminated Easterbrook for ‘cause,’” lawyers for McDonald's wrote.
The severance plan, outlined in proxy filings in March 2019, called for Easterbrook to receive $675,000 in salary continuation, $2,855 in benefit continuation and $24,400 in sabbatical and transition assistance, according to NRN executive pay analysis.
Last week, the company expanded its investigation to include more corporate deceit. McDonald’s alleges that Easterbrook also covered up misconduct within the human-resources department, which led to exit of the company’s then chief people officer David Fairhurst, who abruptly left the company the day after Easterbrook was fired.
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