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Market Basket feud heading to mediation as Demoulas accuses board of silencing his allies
A spokesperson for suspended Market Basket CEO Arthur T. Demoulas accused the company’s board of attempting to silence associates demanding his return.
Market Basket is heading to mediation in hopes of resolving the ongoing feud between the grocery chain and its suspended chief executive, Arthur T. Demoulas.
Both sides have agreed to “put the issues between them” before a mediator Sept. 3 “in hopes of avoiding litigation and reaching a quicker and amicable resolution that is in the best interest of Market Basket’s associates, customers and the communities it serves,” Demoulas spokesperson Justine Griffin announced Tuesday.
Previously:
Market Basket’s board placed the CEO and several other employees on paid leave back in May amid an investigation into allegations that Demoulas was planning a work stoppage. At the time, the board suggested Demoulas — a popular leader affectionately known as “Artie T.” — meant to take retaliatory action after board members demanded access to key employees and collaboration “regarding the most basic corporate oversight.”
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The board has also cited concerns over transparency and succession planning in the family-run business.
Last week, Market Basket cut ties with two company veterans and “Artie T.” allies: Joseph Schmidt, the company’s director of operations, and Tom Gordon, the director of grocery operations. The ongoing supermarket saga has even drawn attention from local elected officials, with Methuen’s mayor recently calling on Market Basket to end the “drama” and welcome Demoulas back into the fold.
A lawyer for the Market Basket board previously announced the mediation plans Friday, saying his law firm, Quinn Emanuel, has nearly completed its investigation into allegations of a planned disruption of company operations and “other matters.”
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“However, out of deference to Mr. Demoulas, at this stage, the Board has decided not to release its findings until the Board and Mr. Demoulas have the opportunity to meet with a neutral mediator to determine if the long-standing issues between them can be resolved,” attorney Harvey J. Wolkoff said in a statement.
According to Wolkoff, any further action depends on the outcome of September’s mediation.
“It is the hope of the Board that a constructive resolution can be reached,” he added.
Griffin said discussions about potential mediation had been ongoing for more than two weeks.
“And that fact alone illustrates how irresponsible Directors Jay Hachigian, Steven Collins and Michael Keyes were early last week, when they fired Joe Schmidt and Tom Gordon and then promoted a series of employees to take their places,” she added. “This was all done in a clear attempt to get out ahead of the mediation process in an effort to further silence the associates within the company who are demanding the return of the senior management team.”
Jay Hachigian, chair of the Market Basket board, sharply refuted Demoulas’s claims in a statement of his own.
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“The statements by Arthur’s spokesperson are not credible and make no sense,” Hachigian said. “I look forward to seeing Arthur in mediation.”
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