Market Basket’s long history of company drama has hit a new boiling point.
A Massachusetts judge on Thursday sided with the family-owned New England cult favorite grocery chain after it sought a temporary restraining order against two ousted executives, who it says are “lieutenants” for the suspended CEO Arthur T. Demoulas.
An order by a Middlesex Superior Court judge now bars Market Basket’s former director of operations, Joseph Schmidt, and the chain’s former store and grocery director, Tom Gordon, from the company’s 90 stores and property.
The Demoulas family founded the grocery store chain, which has been engulfed in family disputes and public power struggles for decades.
“The effect of the Court’s injunction is to put a stop to these individuals’ ongoing unlawful behavior and order them to stay away from Market Basket’s stores and offices,” Market Basket’s board director, Steve Collins, told Business Insider in a statement.
Collins said that in the past few days alone, Schmidt and Gordon went to at least 23 different Market Basket stores “without authorization” and added that Schmidt used a side entrance to access the chain’s corporate headquarters, where he spent time going through the offices of a number of associates.”
“The Court found that Schmidt and Gordon were not believable and that their conduct was harmful to Market Basket,” Collins said.
Collins said that Market Basket was “concerned” that Schmidt and Gordon — who Collins referred to as “lieutenants” of Demoulas — “were accessing the Market Basket stores and offices to intimidate our associates and disrupt company operations.”
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“They continued this conduct despite numerous warnings and requests that they stop, which the Court determined were clear and unequivocal directions,” Collins said. “This order puts a halt to that unlawful activity.”
Judge William Barrett wrote in his order that Schmidt and Gordon “were given clear and unambiguous instructions to refrain from entering” Market Basket property.
An attorney for Schmidt and Gordon did not immediately respond to a request for comment. Schmidt, however, said that while he was “disappointed with the result,” he has “great respect for the judicial system.”
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Justine Griffin, a spokesperson for Demoulas, said, “We are surprised by this ruling,” in a statement to Business Insider.
Griffin said Schmidt and Gordon “have dedicated their entire professional careers to Market Basket and have been key to its success and building on its culture.”
“They have fostered the community of associates that is the Market Basket family,” said Griffin. “Since May 28, their integrity has been attacked with a host of false accusations but they have persevered with dignity and integrity.”
Griffin said that once Schmidt and Gordon were fired in July, “they believed they were able to visit the stores and did so not to threaten and intimidate, but to check on people and provide reassurance that things will be OK.”
“We will respect this ruling but are saddened that it is built on misconceptions about their intent,” the spokesperson said.
Market Basket’s board placed Demoulas, Schmidt, and Gordon on administrative leave on May 28 over allegations that the CEO had started planning a work stoppage intended to disrupt the company’s business and operations.
“The Executive Committee believes that Mr. Demoulas and others have taken these steps as improper retaliation for the Board’s directives requiring the CEO to work with the Board regarding the most basic corporate oversight and to provide the Board access to key employees,” the company said in a statement at the time.
Demoulas remains on suspended leave with pay.
In court documents, Market Basket’s attorneys argued that Schmidt and Gordon had waged a monthslong “campaign of intimidation and defiance,” and “falsely suggested” to Market Basket associates that they will get their jobs back through Demoulas.
“Their goal in waging this campaign is to encourage associates to slow down their work, or even walk off the job, and to pressure Market Basket management to reinstate them and Mr. Demoulas,” the court papers say.
Schmidt and Gordon have argued in court documents that there was no “campaign of fear” and admitted they made visits to Market Basket stores in August to see their former colleagues who “welcomed” them.
In 2014, Demoulas was fired from his CEO role following a family dispute.
The firing sparked a widespread workers’ protest, and Demoulas was reinstated after he bought the rival family faction’s $1.5 billion majority stake in the company.
