McDonald's Former CEO Says He Should Keep His Multimillion-Dollar Severance
By Heather Haddon
Former McDonald's Corp. Chief Executive Steve Easterbrook said
in a court filing Friday that he complied with all the terms of his
separation agreement with the fast-food company and it shouldn't be
allowed to claw back his multimillion-dollar severance package.
In his latest response to the lawsuit McDonald's filed seeking
to recoup that severance, Mr. Easterbrook's attorney said the
former CEO abided by all the demands made in the severance
agreement. McDonald's fired him last year after he acknowledged
having a consensual relationship with an employee.
The agreement required Mr. Easterbrook to comply with many
terms, including refraining from working for a rival for two years,
disparaging or suing the company, sending letters to employees or
speaking publicly about McDonald's without permission. In turn,
McDonald's granted Mr. Easterbrook pay and stock awards, his lawyer
said in the court filing.
Mr. Easterbrook's lawyer said in the filing that the burger
giant hasn't kept its side of the severance agreement by seeking
now to claw back severance. That payout currently is estimated to
be worth $57.3 million, according to executive-pay firm
"McDonald's received the entire benefit of its bargain," said
Daniel Herr, Mr. Easterbrook's Delaware-based employment attorney,
in the filing in the state's Court of Chancery.
McDonald's said in a statement Friday it would continue to
pursue the return of Mr. Easterbrook's severance. "Steve
Easterbrook lied and destroyed evidence to conceal his
inappropriate conduct and impede the investigation into his
behavior," the company said. "He cannot hide behind baseless
The company made the rare move in August to fight over
compensation awarded to a former executive. McDonald's said an
investigation found evidence that the former CEO lied to the
company and its board to cover up additional sexual relationships
with employees to secure a multimillion-dollar severance
McDonald's said its investigators found email messages with
attachments that contained dozens of nude and sexually explicit
photos and videos of Mr. Easterbrook with company employees and
other women between late 2018 and early 2019.
On Friday, Mr. Herr reiterated that McDonald's possessed
information about the relationships on the company's servers when
it first investigated his conduct last October, and fired Mr.
Easterbrook without cause to avoid a lengthy dispute.
"Any attempt by McDonald's to point to 'new' information is
futile," Mr. Herr said in the filing.
Mr. Herr reiterated Friday that the lawsuit should be moved from
Delaware to a court in DuPage County, Ill., saying the CEO's equity
awards specified Illinois as the forum for any legal challenge when
signed. McDonald's has said Delaware is the correct venue for the
case. Oral arguments for the case are scheduled for Nov. 13.
Write to Heather Haddon at firstname.lastname@example.org
(END) Dow Jones Newswires
September 18, 2020 21:50 ET (01:50 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
Historical Stock Chart
From Nov 2020 to Dec 2020
Historical Stock Chart
From Dec 2019 to Dec 2020