Arthur T. Demoulas, who was fired as Market Basket CEO on September 10th and subsequently sued by its Board of Directors, today responded to the original lawsuit and filed a counterclaim against the same board. (links court documents and supporting exhibits are published, in their entirety, at the end of this report)
In an email sent to InsideLowell earlier this afternoon, a Demoulas spokesperson writes “he is not seeking monetary damages, but for the court to find the board’s actions were unlawful and to reinstate him.”
The lengthy filings also reveal, for the first time publicly, pending family trust litigation between Arthur T. and his three sisters, along with family business dealings.
The countersuit claims “the Sisters used the facts of Mr. Demoulas’s suspension and the pretextual Investigation, which they had orchestrated through the Director Defendants, to support their self-interested positions in unrelated pending litigation in Massachusetts involving the Demoulas family’s trust.” (referenced on page 49 of the linked answer and counterclaim document)
Page 67 of the same document outlines “Tensions Reemerge Within the Demoulas Family,” with the suit claiming the sisters “grew uncomfortable with the recognition Mr. Demoulas received as a result of the 2014 transaction and carrying the Company’s success into its new era” and that they “desired larger stockholder distributions.”
It adds “the latest unrest at the Company was precipitated by accusations from Sister Frances Kettenbach that the 2014 acquisition was somehow unfair to her,” while describing subsequent business dealings with two of the sisters’ spouses.
The filings also contain claims the board manufactured allegations of a work stoppage, wasted corporate assets on a “witch hunt” to investigate those allegations, and they also “systematically” altered meeting minutes to cover their actions.
To date, the Market Basket Board of Directors has not publicly released the findings of their investigation, which was conducted by the Quinn Emmanuel law firm. Demoulas’ filings also question the legitimacy of the investigation, noting that Quinn Emmanuel claims “to represent the Executive Committee, the Board, the Company, and the Sisters.”
The latest Market Basket saga began May 28, when Demoulas was placed on paid administrative leave by the board. Charges and countercharges ensued throughout the summer, culminating in the September firing after what was termed a failed mediation effort.
During that entire period, Demoulas himself didn’t issue any public statements other than addressing the firing of three longtime colleagues in September.
According to news reports, the board says the lawsuit is scheduled for trial in Delaware mid-December.
