Judith Fisher’s Promotion App Peter Walters, the chief financial officer, had a close relationship with one of his employees, Judith Fisher,

Judith Fisher’s Promotion App
Peter Walters, the chief financial officer, had a close relationship with one of his employees, Judith Fisher, but they broke up. A few months later, Walters had to choose someone to be promoted to his deputy. Judith Fisher is one of three candidates. She didn’t get the job. She now claims that it is because she has a personal relationship with Walters that has turned sour. According to her, this is Walters’ way of revenge. Patrick McGuire and Veronica Simpson (HR Director) took no action. Judith is now threatening legal action against the company.
Did we make the right decision regarding Peter Walters and Judith Fisher? What other actions, if any, should we take?