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Market Basket board member who backed Arthur T. ousted by CEO’s sisters
Bill Shea’s dismissal from the Market Basket board was “abrupt and inelegant,” Demoulas alleged in a statement.
A longtime Market Basket board member is the latest casualty in the corporate feud between sidelined CEO Arthur T. Demoulas and his sisters.
“Artie T.” ally Bill Shea says Demoulas’s sisters ousted him from the board earlier this month after he demanded more information about the allegations that led to Demoulas’s suspension back in May, particularly claims that Demoulas and his lieutenants might have been planning a potential work stoppage.
“That’s not a threat, it’s a duty that I had — to get to the bottom of why they had so publicly decapitated this incredibly successful company, removing its management,” Shea said in a statement Monday.
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He questioned the independence of the three remaining board members, alleging they’ve “thrown the company into turmoil in a very public way” amid a widening corporate schism. Opposite Arthur T. in the battle for Market Basket dominance are sisters Caren Demoulas Pasquale, Frances Demoulas Kettenbach, and Glorianne Demoulas Farnham. They control 60% of the company’s shares, compared to Arthur T.’s 28%.
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A spokesperson for Arthur T. alleged the sisters removed Shea — a longtime board chairman — without informing him or Demoulas beforehand.
“In taking this action, Mrs. Kettenbach, Mrs. Farnham and Mrs. Pasquale have done two things,” spokesperson Justine Griffin alleged. “They have eliminated the one person who had the right to demand the factual information behind these false accusations; the one person who could question their actions and that of their hand-picked board members.”
Further, Griffin said, the sisters have “wiped out any dissent to their moves” and erased Shea’s years of institutional knowledge.
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Demoulas’s sisters previously removed longtime board member Terry Carleton in January. The three remaining board members were all appointed by the sisters within the past six years: private equity executive Steven Collins, attorney Jay Hachigian, and real estate developer Michael Keyes.
In a statement, Demoulas thanked Shea for his “tremendous contributions” to the company and acknowledged the former board member had “weathered some well-known storms” over his 26-year tenure.
“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.”
Quinn Emanuel partner Harvey Wolkoff, a lawyer for the Market Basket board, fired back in a statement and derided Shea as “Arthur’s rubber stamp,” accusing him of making “baseless claims and threats of lawsuits against the board.”
“Bill Shea knows exactly why he was removed as a director,” Wolkoff said.
He alleged Shea voted against measures to hold Demoulas accountable to the board, including proposals that would require the CEO to submit an annual budget and prepare a “sensible transition plan.” Wolkoff also appeared to suggest Shea could be connected to the leak of confidential Market Basket documents to the press.
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Shea’s dismissal “is not an attempt to silence dissent,” but a reflection of his alleged track record of prioritizing Demoulas’s interests over the company’s — behavior the three sisters have “tolerated … for some time,” Wolkoff added. He said the company’s shareholders are looking to name a new director later this year.
Shea, meanwhile, pointed to Market Basket’s streak of success during his tenure on the company’s board.
“By every measurement, Market Basket was operating at the top of its game during that time — ranked number two in the country with operating results quarter after quarter that are the envy of the industry,” he said. “I wouldn’t take a single vote back. The only thing the sisters had to ‘tolerate’ was tremendous performance.”
Shea’s removal comes weeks after the Market Basket board fired two other prominent Arthur T. allies, former executives Joe Schmidt and Tom Gordon. Last week, the company sought — and was granted — a court order preventing Schmidt and Gordon from continuing to visit Market Basket stores following their termination.
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Demoulas and the Market Basket board will head to mediation next month in an attempt to resolve their differences.
