Market Basket board removes director who supports suspended CEO Arthur T. Demoulas
The Market Basket Board of Directors has removed one of its members who was an ally of suspended CEO Arthur T. Demoulas.
The removal of director Bill Shea has sparked another war of words between the board and Demoulas amid a family fight for control of the regional supermarket chain.
Harvey Wolkoff, a lawyer for the board, alleged in a statement that Shea has made "baseless claims and threats of lawsuits" against board members that he leaked to the press, all while being "Arthur's rubber stamp for decades."
"Again and again, he has prioritized loyalty to Arthur Demoulas over the $8 billion company to which he owes a fiduciary responsibility, and its 30,000 associates and millions of customers," Wolkoff said. "His latest series of one-sided contentions shows he is not about to change his position, leading to the decision to remove him from the Board."
Market Basket board member removed
Arthur T. Demoulas, his two children and other executives were suspended by the board in May. The board said Demoulas was being investigated for "planning a work stoppage," while he said the suspension was cover for a "hostile takeover."
"I think it is clear that the main reason I was removed was that I was exercising my right as a board member to demand information on what the basis of these allegations against Arthur was, particularly about the supposed work stoppage," Shea said in a statement.
The "Artie T." side said that with Shea's removal, the board has now been completely taken over by the Demoulas sisters, who control 60% of the company's shares.
Arthur T. Demoulas statement
Demoulas said in a statement that Shea has "weathered some well-known storms" and was instrumental in the success of Market Basket during his 26-year tenure on the board.
"Mr. Shea embraced the associates and the culture of Market Basket, recognizing early on that it is the heart of the company and is the secret to our collective success," Demoulas said. "He deserves every accolade. His abrupt and inelegant dismissal saddens me."
The two sides are scheduled to go before a mediator on Sept. 3. Last week, a judge approved a restraining order to keep fired Market Basket executives Tom Gordon and Joseph Schmidt away from company property.