Luckin Investigation Finds No Evidence of CEO Misconduct
What’s new: Scandal-hit Starbucks challenger Luckin Coffee Inc. said in a statement released on Wednesday that an investigation team formed by the company found no evidence of misconduct by its CEO Guo Jinyi, after interviewing nearly 40 people, including external parties and company staff.
The team, which also comprise one of the joint provisional liquidators appointed by the Grand Court of the Cayman Islands and independent directors, found however that certain members of the company’s former management team participated in planning the submission of a letter to Luckin’s board of directors in January demanding the immediate dismissal of Guo and an investigation into his conduct.
“The company’s board will continue to fully support Dr. Guo and the management team,” the statement said.
What’s the background: A group of managers, including seven vice presidents, signed the letter, which accused Guo of cronyism, abuse of power and being incapable of making the right decisions for the company.
Guo has since hit back against his accusers, claiming that the letter was the work of his disgraced predecessor and company co-founder, Lu Zhengyao, who oversaw the fabrication of 2.1 billion yuan ($321.3 million) in sales that, when revealed, sparked a scandal that brought the company to its knees.
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