Money & The Economy

Papa John’s Founder Suing Company, Accuses It Of Planning ‘Coup’


by Kyle Perisic

Papa John’s founder and former CEO John Schnatter is suing the company, seeking documents related to the person who outed him saying the N-word and accused the company of planning a “coup” against him.

“Instead of standing behind the founder and working with news media to explain what actually occurred, the Company followed its usual, and flawed, manner of dealing with false and mistaken reporting as to comments made by Mr. Schnatter,” the lawsuit, filed in Delaware, said.

Schnatter resigned on July 11 after he admitted to using the N-word during a press call in May, The Daily Caller News Foundation reported.

“[E]ither the purportedly independent directors acted without adequate information … or [they] planned this coup in advance,” Schnatter said.

Schnatter later said in a letter to the pizza chain’s board of directors that resigning was a “mistake,” The Wall Street Journal reported on July 17.

“The board asked me to step down as chairman without apparently doing any investigation. I agreed, though today I believe it was a mistake to do so,” Schnatter wrote.

Schnatter’s attorney, Patty Glaser, told CNBC in a statement that Papa John’s “is hiding documents that, we believe, will disclose the actual facts as to what is occurring here, including using Mr. Schnatter as a scapegoat to cover up their own shortcomings and failures.”

“We are saddened and disappointed that John Schnatter has filed a needless and wasteful lawsuit in an attempt to distract from his own words and actions,” Papa John’s spokesman Peter Collins told CNBC in an email Thursday. “We will not let his numerous misstatements in the complaint and elsewhere distract us from the important work we are doing to move the business forward for our 120,000 corporate and franchise team members, and our franchisees, customers and stakeholders.”

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