Global Economics

McDonald’s Sues Former CEO

On Monday, it was discovered that McDonald’s (MCD) is suing its former CEO, Steve Easterbrook, to recover millions of dollars paid in severance and compensation benefits. The lawsuit alleges that Easterbrook committed fraud and lied prior to his being let go.

Easterbrook was initially terminated from McDonald’s following an internal investigation and discovery that he had been carrying on an intimate relationship with a company employee. An agreement including severance and compensation for Easterbrook was drawn up. In the termination agreement, McDonald’s agreed to compensate the former CEO for salary, severance pay, and for various performance targets reached – a total sum said to be around $42 million.

In July, further investigations related to Easterbrook were launched following the discovery of new information. It was found that Easterbrook carried on multiple relationships with employees, whereas he had previously stated it was only one. During one of these relationships, it was discovered that he simultaneously allowed for a stock grant to be approved to an employee with value in the hundreds of thousands of dollars. There was also a discovery of dozens of nude and sexually explicit photos and videos between Easterbrook and other women that were sent through his corporate email between 2018 and 2019; Easterbrook had previously deleted these emails from his phone prior to the original investigation.

According to McDonald’s, they were unaware of these newly discovered actions and state that they would not have agreed to the termination agreement had they known.

At the time of this article’s writing, McDonald’s stock was down 0.15% to $204.285.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Trader Buzz). I have no business relationship with any company whose stock is mentioned in this article.


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