Assignment task:
Background/Fact Pattern You may well have heard about this matter - it has been in several legal publications, newspapers, and even the news. A very general description of the facts is as follows: McDonald's fired its CEO in 2019 due to his "inappropriate personal relationship with a McDonald's employee in violation of corporate policy." The following year's proxy statement reported that he had been terminated "without cause" and described his termination arrangements. SEC Enforcement The SEC went after both the CEO and the company. The CEO was targeted because, among other things, he withheld material information from the company. Ultimately, the company was able to claw back more than $100 million of compensation from the CEO, who has also been barred for five years from serving as a director or officer of a public company and was required to pay fines of more than $400,000 to the SEC. Interestingly, the SEC sanctioned McDonalds for failing to properly disclose the nature of the CEO's termination and the bases on which his severance compensation was determined. We've all seen proxy statement after proxy statement explaining that the CEO (or another executive) was terminated without cause and received extensive severance pay.