Papa John's founder John Schnatter resigns as chairman after using racial slur

Elias Hubbard
July 12, 2018

Schnatter's comments were made during a May conference call with a marketing agency and were revealed Wednesday by Forbes, which reported that he was engaged in "a role-playing exercise" created to help him avoid damaging public-relations gaffes.

On the May call, Schnatter reportedly said the N-word while complaining that a legendary fast-food chain founder had used the word in the past without being subjected to public backlash.

Following a call to shareholders in November, Schnatter came under fire for remarks about the NFL.

After he learned about the matter, the chairman and CEO of Laundry Service parent company Wasserman, Casey Wasserman, moved to end Laundry Service's contract with the pizza chain, Forbes said. "Regardless of the context, I apologise", the statement said.

Papa John's, the mediocre-at-best pizza chain and former National Football League pizza sponsor, effectively canceled itself toward the end of a year ago when the then-CEO, John Schnatter, blamed slumping sales on the National Football League protests against police brutality and racial injustice.

Schnatter founded Papa John's in the Louisville suburb of Jeffersonville, Indiana.

The racist incident that spurred this was brought to light by Forbes, which reported on a May PR training session involving Schnatter. Grissom defended Schnatter, saying the comments did not reflect his personal beliefs. Schnatter confirmed in a statement that Forbes' report about the call was accurate.

The report said Schnatter "also reflected on his early life in IN, where, he said, people used to drag African-Americans from trucks until they died".

The source added that although Schnatter intended for his remarks to show his stance against racism, multiple people found it objectionable.

Laundry Service cut ties with Papa John's shortly after.

The company's statement continued, "Diversity is an essential ingredient in our pursuit of providing a better product and better service to our customers and to the communities where we operate and live".

Papa John's shares fell almost 5 percent on the news Wednesday, dipping from a high of $51.04 shortly after the opening bell to $48.42 per share by the close. Sports reported the league was suspending its "Papa Slam" promotion that allowed baseball fans to get 40 percent off their order the day after a grand slam.

Other reports by Click Lancashire

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