Former McDonald’s CEO Steve Easterbrook has returned a severance package valued at $105 million to the company, ending an unusual legal battle that erupted after he was fired for sexual misconduct.
McDonald’s announced on Thursday that it had settled the lawsuit it filed against Easterbrook in August 2020 alleging he lied during its internal investigation into his behavior. The board decided it would not terminate him “for cause,” allowing him to leave the company with the severance package.
“Under the settlement, Mr. Easterbrook has returned equity awards and cash, with a current value of over $105 million, which he would have forfeited had he been truthful at the time of his termination and, as a result, been terminated for cause,” McDonald’s said in a news release.
Easterbrook admitted that he “failed at times to uphold McDonald’s values and fulfill certain of my responsibilities as a leader of the company. I apologize to my former co-workers, the board, and the company’s franchisees and suppliers for doing so.”
As Restaurant Business reports, “The settlement ends an extraordinary legal battle between the world’s largest restaurant chain and a CEO largely given credit for helping the company emerge from a years-long, post-recession malaise after he took over in 2015.”
Easterbrook was fired in November 2019 after the McDonald’s board found he had a consensual relationship with an employee. The board reopened its investigation after an employee said Easterbrook had a sexual relationship with another subordinate while he was chief executive.
In its suit, McDonald’s alleged Easterbrook told investigators he only had one relationship with an employee and that he deleted nude or sexually explicit photos and videos of women — including the female employees — from his phone before it was searched by an outside investigator.
A clause in Easterbrook’s contract contained a provision that would let McDonald’s recoup severance payments if it later determined he should have been fired for cause.
The settlement “holds Steve Easterbrook accountable for his clear misconduct, including the way in which he exploited his position as CEO,” McDonald’s Chairman Enrique Hernandez Jr. said.