IN REMCDONALD'S II C.A. No. 2021-0324-JTL

Court of Chancery of the State of Delaware March 1,2023 Michael J. Barry, Christine M. Mackintosh, Rebecca A. Musarra, Vivek Upadhya, Michael D. Bell, GRANT & EISENHOFFER P.A., Wilmington, Delaware; Barbara J. Hart, GRANT & EISENHOFFER P.A., New York, New York; Geoffrey M. Johnson, SCOTT+SCOTT ATTORNEYS AT LAW LLP, Cleveland Heights, Ohio; Jing-Li Yu, SCOTT+SCOTT ATTORNEYS AT LAW LLP, New York, New York; Max R. Huffman, SCOTT+SCOTT ATTORNEYS AT LAW LLP, San Diego, California; Jeffrey M. Norton, Benjamin D. Baker, NEWMAN FERRARA LLP, New York, New York; Attorneys for Plaintiffs Teamsters Local 237 Additional Security Fund, Teamsters Local 237 Supplemental Fund for Housing Authority Employees, Teamsters Local 237 Welfare Fund, and Phyllis Gianotti. In December 2018, the Director Defendants learned that the Company's Global Chief People Officer and head of its worldwide human resources function, the very executive officer specifically charged with promoting a culture of inclusion and respect at the Company, had engaged in an act of sexual harassment. In a distinct but related claim, the plaintiffs allege that the Director Defendants breached their fiduciary duties by terminating the Company's CEO without cause in November 2019 after learning that he had engaged in an inappropriate relationship with an employee. Assuming for the sake of argument that they had breached their duty of care by not conducting a more thorough investigation, the Company's certificate of incorporation contains an exculpatory provision, so the directors would not face liability for that shortcoming.