Demetriou is also adamant that Hird is receiving no payment from the Bombers while he serves a 12-month suspension.
The AFL boss also said on Wednesday he is unaware of what happened in back-room negotiations before the league announced the penalties handed down to Essendon.
Demetriou was speaking in reaction to a Herald Sun report that gave more detail about the complicated negotiations.
"What the public should know is that we were absolutely true to our process, that we said there was no predetermined outcome and that we would hear the matter on the day," Demetriou told 3AW.
"We had absolutely no fear, no hesitation in this matter being taken to court.
"I had no fear about me being taken to court.
"The AFL did not offer, did not authorise, inducements and paid ... study to the best of my knowledge.
"There would have been absolutely no discussion from anyone at the AFL about (being) paid while you're not coaching or being suspended."
Wednesday's newspaper report outlined an August 23 meeting held at the home of Demetriou's deputy Gillon McLachlan that involved Hird and two other senior AFL officials.
There were also more details of the involvement of Australian Sports Commission chairman John Wylie.
When it looked as though Essendon and Hird might take the AFL to court over the charges, Wylie acted as an intermediary.
Apart from banning Hird for 12 months, the AFL also kicked Essendon out of the 2013 finals, fined them $2 million and stripped them of draft picks.
Hird accepted his penalty, but continues to deny he did anything wrong.
Demetriou said he did not know if Hird was being paid by a third party while he was under suspension.
The AFL also handed down punishments to assistant coach Mark Thompson and football manager Danny Corcoran, while a settlement was negotiated with club doctor Bruce Reid.
Thompson was fined and is coaching the Bombers during Hird's suspension.