Battle for control of $7 billion grocery retailer ramps amid allegations

Market Basket, a family-owned New England supermarket chain with nearly 100 stores in Massachusetts, Maine, and New Hampshire, is embroiled in a heated battle for control.

It isn't the first time.

In 2014, Arthur T. Demoulas, the grandson of Market Basket's founder, was temporarily ousted by his cousins, who were reportedly interested in shifting the company's culture. The coup led to highly publicized employee strikes and customer boycotts, resulting in his reinstatement.

Loyalty like that is pretty hard to come by nowadays.

Yet Demoulas, popularly known as Artie T., has once again come under fire. This time, his sisters, who had supported him during the last battle for Market Basket's control, are looking to push him out.

They suspended Artie T. in May for allegedly resisting board oversight, promoting a work stoppage, and installing his children in key jobs without board approval.

Shortly thereafter, Market Basket's board fired executives Joe Schmidt and Tom Gordon, who were seen as loyal to Demoulas, for insubordination in July.

It's unclear if there will be strikes and boycotts again to support Demoulas, but Schmidt and Gordon don't appear to be going away quietly.

According to Market Basket's board, they've visited nearly two dozen store locations, ostensibly lining up support for Demoulas.

Family members are feuding over control over the Market Basket grocery store retail chain.

Image source: MediaNews Group/Boston Herald via Getty Images

Market Basket employees caught in the crossfire

In 2014, many employees, including store managers, sided with Artie T. because they were concerned that his cousins would make changes that negatively impacted their employee—and customer-focused culture to boost profits or sell the supermarket chain to a deep-pocketed conglomerate.

The battle a decade ago was fierce and took a toll on workers, who once again could find themselves caught between warring family factions.

While some employees appear less interested in another contentious walk-out, some have become increasingly critical of the current board's decision to suspend Demoulas and fire Schmidt, its former operations director, and Gordon, its grocery supervisor.

“What was once a culture grounded in mutual respect, integrity, and accountability has, in recent months, devolved into one defined by fear, hostility, and lack of direction,” said Director of Advertising and Store Operations Supervisor Valerie Polito in a July 18 letter to the Board of Directors, according to CBS News.

Market Basket seeks restraining order on Gordon and Schmidt

Market Basket's board of directors has filed for a restraining order against Gordon and Schmidt, saying the duo has visited its headquarters and 23 stores this month without permission.

According to NBC Boston, the board claims that Gordon and Schmidt have visited the locations “to intimidate employees, precipitate a work slowdown, employee walkout, and customer boycott.”

“Market Basket associates are entitled to feel safe while performing their jobs whether at headquarters in Tewksbury or in stores, said Market Basket board member Steven Collins. “But in recent days, terminated executive Joseph Schmidt was documented on video after hours breaking and entering at the Tewksbury headquarters holding the master key that he has refused to return and moving around the offices totally unauthorized.”

The restraining order was requested in Lowell, Massachusetts, and a hearing is scheduled for Thursday at 10 a.m.

If granted, it could drive employees to pick sides, increasing the temperature ahead of a planned mediation between board members and Artie T. in September.