Former McDonald's (NYSE:MCD) CEO Steve Easterbrook, who was ousted in November after he "violated company policy and demonstrated poor judgment" by entering into a consensual relationship with an employee, is now being sued by his former employer according to a report from The Wall Street Journal. The fast food chain claims Easterbrook lied to the company's board of directors about sexual relationships with multiple employees during its investigation into the matter, prompting the company's effort to reclaim his severance package worth around $40 million.

Easterbrook was named chief executive officer in early 2015. Under his guidance, the consumer-facing company accelerated its sale of corporate-owned restaurants to franchisees to better focus on franchising itself. The move hurt the top line, but by design. Less bogged down by managing some of its own stores, the organization was able to prioritize its overall profitability.

McDonald's Golden Arches Logo

Image source: McDonald's Media Relations.

Easterbrook's restructuring success, however, wasn't enough to save his job. The board moved to remove him in November for violating corporate rules that bar personal relationships with subordinates. Additional information has surfaced in the meantime indicating the former CEO had been in physical relationships with three other employees, one of whom he allegedly awarded with stock options worth hundreds of thousands of dollars. These critical details were not only not disclosed during the board's investigation, but reportedly covered up and denied by Easterbrook.

Aside from an effort to claw back a relatively small amount of severance pay offered to Easterbrook upon his exit the company categorized as "without cause," the McDonald's suit also aims to prevent the former chief from exercising millions of dollars' worth of stock options given to him as part of a severance package.

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