Market Basket CEO Arthur T. Demoulas fired after unanimous vote by board

Beloved Market Basket CEO Arthur T. Demoulas is out after a unanimous vote by the board Tuesday following an unsuccessful mediation between the two sides.

Market Basket Board Chair Jay K. Hachigian released a statement Wednesday morning, announcing the firing.

“Despite extensive efforts by the Board and Mr. Demoulas to come to terms, the mediation was not successful,” Hachigian said. “The Market Basket Board late yesterday voted unanimously to remove Arthur T. Demoulas as President and CEO of Market Basket.”

Hachigian didn’t say why the mediation failed, saying only that the board met with Demoulas on Sept. 3 in a confidential mediation in Delaware before former Vice Chancellor Joseph Slights III and continued the mediation via video conference on Sept. 9.

Both parties agreed not to comment publicly during that time, according to Hachigian, who added that the board has filed an action in the Delaware Court of Chancery in connection with the removal.

Ahead of mediation, a spokesperson for Demoulas said he was confident that mediation would be successful if the board shared the same commitment to reaching an agreement that he did.

NBC10 Boston has reached out for comment from Demoulas on his firing but has not heard back yet.

Boston attorney Amy Mariani specializes in business mediation and talks with us about what goes into these kinds of meetings.

Hachigian said Demoulas’s firing will not impact the grocery chain’s customers.

“We assure our valued associates and customers that, as we have demonstrated over the past several months, Market Basket will not change its operations, profit-sharing, bonuses or culture, and will continue to offer the best groceries at the lowest prices anywhere in New England—well into the future,” he concluded his statement.

There was no immediate word from Hachigian on who will succeed Demoulas as chief executive.

So, what led to this point? The NBC10 Boston podcast, Food Feud: Market Basket, has followed every twist and turn of this ordeal, while unpacking how a century of Demoulas family history has led the company to where it is today. The podcast is available on streaming platforms now.

Food Feud: Market Basket is available wherever you listen to podcasts.

The ongoing dispute began in May, when it was announced that Demoulas and other executives were put on an administrative leave by the company’s board of directors. The board alleged that Demoulas was planning a work stoppage and that he had a “unilateral right to appoint his children to succeed him.”

Demoulas called the board’s investigation at the time “a farcical cover for a hostile takeover.”

The suspension came 11 years after Demoulas, known among workers and some shoppers as “Artie T.”, was fired from his job. His firing sparked massive backlash in 2014, and led to walkouts and boycotts, which eventually helped him to regain his post.

In those days, the board of directors was controlled by a different side of the family led by his cousin, Arthur S. Demoulas. Arthur T.’s side bought out the Arthur S. side, which put him back in control of the company.

The latest family infighting, however, appeared to be within Arthur T.’s side. His three sisters, Caren, Frances and Glorianne, have a combined majority control over the board of directors, which is the body taking action against Demoulas.

The board hired an outside law firm, Quinn Emanuel, to conduct an internal investigation into Demoulas and his deputies. The investigation was said to be nearly complete in July, but findings were not to be released until last week’s mediation session.

Since the initial suspension, much of the conflict has played out in public view. The board of directors and Demoulas had each been working with public relations agencies to share their point of view with news media and community members.

In July, two of Demoulas’ closest executives, Joe Schmidt and Tom Gordon, were fired from the company after having been put on leave alongside the CEO. The company said they were fired for “insubordination, making false and derogatory remarks about the company and people associated with it, and inappropriate communications with colleagues.”

The two former executives denied any plans for a work stoppage, and have been outspoken about how they believed this was a succession plan by Artie T’s relatives.

Joe Schmidt and Tom Gordon – who have both worked for Market Basket for decades – say they will continue to fight for the culture and future of the company, and denied being insubordinate or coordinating a work stoppage.

Later in the summer, Schmidt and Gordon were the subject of an order by a Middlesex Superior Court judge to stay away from corporate property at the request of the company, amid allegations they continued to go to Market Basket locations after their firings.

Schmidt and Gordon were not the only Arthur Demoulas loyalists who were let go over the summer. A longtime member of Market Basket’s board of directors, Bill Shea, was removed from his board post earlier this month. Shea had been vocal in his support for Demoulas.

Also this summer, corporate employee Valerie Polito, who on the behalf of several other employees, voiced concern over what they called an atmosphere of “fear, hostility and lack of direction,” as they demanded the reinstatement of the executives.

Polito said that workers were scared to speak openly or ask questions, with a supervisor allegedly being suspended for asking about operations and when Demoulas would come back to work.

A company spokesperson released a letter to news media that was signed by several corporate office employees, refuting claims of a toxic workplace that were made by another group of employees.

“Allegations were made of hostile work environments, bullying, intimidation, fear and repression,” the letter said. “It’s not true. That is not the environment we work in. What they describe is not our experience. There is no ‘culture of fear’.”

The public war of words has attracted the attention of elected officials, including Methuen Mayor D.J. Beauregard, who previously spoke to NBC10 Boston on his public support of Demoulas.

“Let me be clear: whatever is happening behind closed doors at Market Basket needs to stop. Now,” Beauregard wrote in the letter dated July 24. “Resolve this internal dispute and bring back Arthur T. Demoulas — before the damage becomes irreversible.”

The board of directors had also previously issued several statements assuring the public that the Market Basket New England knows and loves is not at risk of changing its culture, regardless of the situation unfolding at its top leadership.