McDonald's Sues Former CEO To Pay Back Around $105 Million In Severance Pay

JAKARTA - Fast food chain franchise McDonald's has settled a lawsuit against former CEO Steve Easterbrook, forcing the executive to pay back his severance package of more than $100 million.

Easterbrook was fired in 2019, after the fast food giant's board ruled he violated company policy by showing a "bad judgment involving a recent consensual relationship with an employee." In August 2020, McDonald's filed a lawsuit against Easterbrook for lying to the board about the extent of his relationship with employees.

In a filing with the US Securities and Exchange Commission on Thursday, McDonald's criticized Easterbrook for his "mistakes, lies and attempts to obstruct an investigation into his actions" and that his settlement was the best way forward.

"This settlement holds Steve Easterbrook accountable for his clear mistakes, including the way he exploited his position as CEO," said McDonald's Chairman Enrique Hernandez Jr. in the archive, citing CNN December 16. "The resolution avoids a protracted litigation and allows us to move forward."

Easterbrook admitted in SEC filings, he "at times failed to uphold McDonald's values and fulfill certain responsibilities of mine as chairman of the company." He also apologized to the board, former colleagues and the company's franchisees and suppliers.

The total amount of the severance package is US$105 million in cash and shares or around Rp. 1,510,493,250,000. However, it was not clear how much of it was stock or cash.

The McDonald's lawsuit alleges the company was notified of Easterbrook's other relationships with employees in July, and opened a new investigation that found evidence of three sexual relationships.

Evidence for the relationship, according to the lawsuit, came in the form of "dozens of nude, partially nude, or sexually explicit photos and videos of various women," including photos of three employees. Easterbrook allegedly attached a picture to an email he sent from his job to his personal account.