2 Market Basket Execs Fired
Shortly after an explosive interview on GBH News’ Boston Public Radio, it was revealed that two of Market Basket’s top executives were fired by the grocery store chain’s board of directors. Director of Operations Joe Schmidt, who took part in the interview with District Supervisor Paul Quigley to voice their strong support of Market Basket’s suspended CEO, was let go, along with Grocery Director Tom Gordon, who did not participate.
According to a statement from the board obtained by GBH News, Schmidt and Gordon terminated “for insubordination, making false and derogatory remarks about the company and people associated with it, and inappropriate communications with colleagues.” The board also noted that the two executives had actually been fired on Monday, July 21, a move that was effectuated on Tuesday, July 22.
During the 20-minute interview on July 22, Schmidt was asked whether he and Quigley feared retribution from the board for speaking out, to which he replied: “If you can’t stand up for something good in your life, then what’s the purpose of life? Yes, you can make money, but money isn’t what it’s all about. It’s about doing the right thing and [standing] up for people that you believe in. And I believe in Mr. Demoulas and his leadership style and the respect that he has and everything he stands for. And that’s why I’m doing it.”
Eight weeks ago, CEO Arthur T. Demoulas, CEO of Tewksbury, Mass.-based Market Basket, was suspended by the company’s board of directors amid allegations that he was planning a disruption of the grocery store chain’s business and operations through a work stoppage. At that time, several other company employees, including Demoulas’ son and daughter, were placed on paid administrative leave, with others suspended later.
In a statement obtained by GoLocalProv, Demoulas blamed the firings on Exeter Capital, the Boston-based private-equity firm that has a major ownership stake in Market Basket: “This is among the worst decisions that could be made by this board. Steven Collins, [managing director] of Exeter Capital, doesn’t understand this company’s culture. Nor do his fellow board members Jay Hachigian, of Gunderson Dettmer, and Michael Keyes, of Intercontinental Real Estate. To them, Tom, after 50 years with the company, and Joe after 39 years, are easily cast aside. They are just collateral damage in this pre-planned coup.”
Demoulas went on to describe Schmidt and Gordon as “part of the heart and soul of the company and key executives in its immense success to date,” and vowed to “use all efforts to reverse this heartless and unwarranted decision.”
In the GBH News interview on July 22, Schmidt and Quigley disputed the board’s reasons for the suspensions, claimed that no investigation had actually been launched to determine the truth of the allegations against Demoulas, and accused the CEO’s sisters of wanting to take control of the company and install the son of one of them as the next chief executive of Market Basket.
Schmidt and Gordon subsequently took part in another GBH News interview on July 23, during which they discussed their terminations, Arthur T. Demoulas, the board of directors, and other topics.
With around 90 stores across the states of Massachusetts, New Hampshire, Maine and Rhode Island and a no-frills approach to grocery retail, Market Basket enjoys cult-like popularity among its dedicated fans in New England and beyond, and Demoulas, affectionately known as “Artie T.,” is revered by his employees.
The current conflict evokes memories of 2014, when Demoulas was toppled from the helm by a Market Basket board controlled by his cousin, Arthur S. Demoulas. As well as unprecedented coverage of the notoriously press-shy retailer, the ouster kicked off a customer boycott and caused the company’s employees to cease work in protest. After a few contentious weeks, a deal was reached to sell Market Basket to Arthur T. Demoulas for almost $1.6 billion.
