Bed Bath & Beyond sued by former CEO Mark Tritton

As if Bed Bath & Beyond didn’t have enough troubles, it’s now being sued.

The beleaguered home goods retailer is being sued by former CEO Mark Tritton, who was fired last June. In a complaint filed in a New York state court in Manhattan, Tritton accused the retailer of failing to honor his $6,765,000 severance agreement.  The news was first reported by Reuters.

According to the complaint, Tritton said Bed Bath & Beyond stopped making required bi-monthly payments in January, with its chief legal officer citing the need to preserve cash. Tritton also accused the company of “bad faith” for proposing a “buyout” of his severance at a discount but only if performance improves even as it has resumed paying severance to some former employees.

Tritton, previously chief merchandising officer at Target Corp., took the reins of Bed Bath & Beyond in November 2019, as the company was challenged with declining sales and foot traffic. He sought to reinvent the business with an ambitious multi-year transformation initiative that included closing underperforming locations, updating stores and focusing on private brands, launching about 10 labels in some two years.

Bed Bath & Beyond has been closing stores and laying off employees as it struggles to turn around its ailing business under new CEO Sue Gove. Last week, the retailer, which is looking to raise more capital, warned in a filing that if its proposed $300 million stock offering doesn’t come off, it would “likely” have to file for bankruptcy protection.

“We likely would be required to file for bankruptcy protection if the company does not receive the proceeds from the offering covered by this prospectus supplement, the company would not have the financial resources to satisfy its payment obligations under the credit facilities, and the company expects that it will likely file for bankruptcy protection and that its assets will likely be liquidated,” Bed Bath & Beyond stated in the filing.