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Market Basket fires two top executives, allies of Arthur T., hours after one gives radio interview
Joe Schmidt, the director of operations, and another suspended employee, grocery supervisor Tom Gordon, were fired Tuesday, Arthur T. Demoulas said in a statement.
After eight weeks, the Market Basket “family food fight” continues, with new revelations from suspended Market Basket executives — one of whom was fired just hours after a radio interview.
CEO Arthur “Artie” T. Demoulas was placed on paid leave at the end of May by the supermarket chain’s board, which cited disagreements over succession planning and alleging that he had been orchestrating a potential work stoppage — an accusation some executives within the organization strongly dispute.
Joe Schmidt, the director of operations, and another suspended employee, grocery supervisor Tom Gordon, were fired Tuesday, Demoulas said in a statement.
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Hours before, Schmidt and Paul Quigley, who were both suspended by the company’s board in the wake of Demoulas’ leave, spoke to Boston Public Radio about their suspension and what’s next for the supermarket giant. Gordon was not present for the interview, but he was mentioned multiple times.
“In addition to being men of strong character, these are two of the brightest and best grocery store operators in the business, and their extraordinary work has been key to building this company and its culture,” Demoulas said in a statement about the firing of Schmidt and Gordon. “This is among the worst decisions that could be made by this board.”
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During the interview, host Jim Braude asked the two men if they feared repercussions from the company for speaking openly about their qualms.
“I worry about my future without Arthur T. Demoulas running Demoulas Super Markets. Without him, the future wouldn’t be very good,” Quigley said.
Artie T.: Gordon, Schmidt are ‘collateral damage in this pre-planned coup’
The Market Basket patriarch slammed the board members in a statement about the firing of Schmidt and Gordon, calling out Steven Collins of Exeter Capital, Jay Hachigian of Gunderson Dettmer, and Michael Keyes of Intercontinental Real Estate by name.
Demoulas, who remains on paid leave, said the longtime employees were “easily cast aside” by the board.
“They are just collateral damage in this pre-planned coup. To Market Basket, Tom and Joe are part of the heart and soul of the company and key executives in its immense success to date,” Demoulas said. “They are men of integrity and honor and belong on the Market Basket team, and we will use all efforts to reverse this heartless and unwarranted decision.”
In 2014, Demoulas was similarly removed from his position by a rival faction within his family, triggering a massive employee-led protest and customer boycott that ultimately forced the board to reinstate him.
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Market Basket did not return a request for comment Tuesday.
Market Basket executives denied allegations of a work stoppage
In the GBH interview, Schmidt rejected claims that anyone was plotting a strike.
“There’s an allegation that I was somehow involved in some type of work stoppage because of the board having a disagreement with Mr. Demoulas, which is just, frankly, not true,” he said.
Quigley, who has been with the company for more than 44 years, was also suspended for “disruptive behavior.”
After Demoulas was removed, Quigley said, he started pressing the board about when their longtime CEO would return and whether an investigation was underway to substantiate the work stoppage claims. According to both Quigley and Schmidt, Demoulas never spoke of or suggested a disruption in operations.
Accusations of greed and power struggles within the Demoulas family
The real conflict, Schmidt argued in the interview, lies in an internal power struggle. He claimed that Demoulas’ three sisters — Frances, Glorianne, and Caren — are seeking greater control of the company, despite already receiving significant financial returns.
“There’s a lot of jealousy with them and thinking that they should have more notoriety in the company, but it also comes down to money. They want more money from the company, and apparently, the $40 million after taxes that they get in on an annual basis is not enough,” Schmidt said.
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Quigley and Schmidt believe the work stoppage accusations serve as a convenient way for the board to sideline Demoulas without sparking the kind of public backlash that occurred in 2014 — and to install their preferred successor without resistance.
“We’ve worked hard with this company for multiple decades, building this company, and over some spite, and greed, and pettiness, they’ve taken us and pushed us out so that they can implant Michael Kettenbach … to be the next CEO,” Quigley said.
Kettenbach, currently Market Basket’s deli director, is Frances Demoulas’ son.
While Arthur T. Demoulas had recommended his own children — Madeline and T.A. — as potential successors, the board rejected those nominations and subsequently placed both of his children on leave as well.
Executives raise concern about the company’s future without Artie T.
Both Schmidt and Quigley expressed deep concerns about the future of Market Basket without Demoulas’ leadership at the helm of the company.
“I believe in Mr. Demoulas and his leadership style and the respect that he has and everything he stands for,” Schmidt said.
Quigley urged customers to publicly voice their opinion.
“Get the word out there that, hey, this company’s in jeopardy. There’s going to be some serious issues down the road. There’s serious issues now, and we need to get back on course,” he said.
When asked about what Schmidt would do if he was “canned” for appearing on the radio, he said “it would hurt, but … money isn’t what it’s all about.” Schmidt was fired hours later.
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“What’s more important is doing the right thing, and I said that 11 years ago and I mean it today, because the right person running the company is Mr. Demoulas,” Schmidt said, “because it not only protects the community, the Market Basket culture, it’s something worth standing up for. If you can’t stand up for something good in your life, then what’s the purpose of life?”
Schmidt and Gordon will speak to the press Wednesday morning just off Market Basket property in Reading.
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