Papa John says he’s being scapegoated


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Papa John's is losing the pizza wars. Big time.

Papa John will not depart Papa John’s alone.

The corporate has tried onerous to distance itself from founder John Schnatter, who blamed the NFL for poor pizza gross sales final fall after which admitted utilizing the N-word on a convention name this spring.

Gross sales slumped, and Papa John’s inventory declined. CEO Steve Ritchie and the present management blame Schnatter, who stepped down as chairman in July.

Schnatter informed CNNMoney in an interview Tuesday that he is being scapegoated.

“You’ll be able to’t blame all the pieces on two feedback,” he mentioned. “I want I had that type of energy, however I do not.”

As an alternative, Schnatter pinned the corporate’s issues on Ritchie, who grew to become CEO in January. Schnatter described him as a poor chief who has created a tradition of intimidation at Papa John’s (PZZA), and let high quality and customer support slip.

“We’d like new management,” he mentioned. “He struggles as a CEO.”

“Steve’ll make an ideal govt some other place,” he added. “He is simply the flawed man for the job.”

He described higher administration beneath Ritchie as vindictive and controlling.

“Individuals proper now are scared to speak,” he mentioned.

Schnatter, who continues to be the most important shareholder and owns nearly a 3rd of the corporate, insists he would not wish to return as CEO. However he has mounted a scorched-earth marketing campaign to drive Ritchie out of his job.

In a letter to franchisees posted to his private web site on Monday, the founder mentioned the corporate is struggling due to “rot on the prime.”

In a press release, Papa John’s referred to as the accusations “unfaithful and disparaging,” characterizing them as “a self-serving try and distract from the damaging influence his personal phrases and actions have had on the corporate and our stakeholders.”

“John Schnatter additionally publicly supported Steve Ritchie’s appointment as CEO on the finish of final yr,” the assertion mentioned.

Schnatter flipped that argument round.

“There’s slightly little bit of a farce happening right here,” he mentioned. “Steve Ritchie guarantees nice issues, after which unhealthy issues occur, after which he blames someone else.”

Schnatter’s lawyer Garland Kelley mentioned the corporate allowed Schnatter’s feedback in regards to the NFL and his use of the racial slur to be misrepresented within the press.

“There is a crucial disconnect between what John truly says and the way the corporate permits it to be portrayed publicly,” Kelley mentioned. “We predict there is a motive that is occurring.”

John Schnatter Papa Johns RESTRICTED
John Schnatter in taken for Forbes Journal in 2017.

In July, Forbes reported that Schnatter had used the N-word whereas on a convention name along with his advertising company.

“Colonel Sanders referred to as blacks n—–s,” Schnatter reportedly mentioned throughout a coaching on how one can keep away from gaffes just like the NFL feedback. Forbes mentioned Schnatter was complaining that Sanders did not obtain backlash, though his feedback have been worse than Schnatter’s personal. KFC didn’t instantly reply to a request for remark.

After the Forbes story broke, Schnatter apologized and resigned as chairman.

On Tuesday, he described the dialog in a different way.

“I merely mentioned, ‘Colonel Sanders mentioned what he mentioned, and we’re not going to say that,'” he mentioned, including that he regrets saying the slur.

“What I mentioned was anti-racist,” he added. “I do not speak that approach.”

“I believe the corporate has made the state of affairs so much worse,” Schnatter mentioned. “[The comment has] been misquoted, it is out of context, it has been portrayed in a approach that is not truthful. However I am nonetheless going to really feel unhealthy about that.”

“I really like my workers. I really like my franchisees,” he mentioned. “For something that hurts them, then I will really feel unhealthy about that, and I do.”

Schnatter additionally thinks his remarks in regards to the NFL management have been misconstrued.

Final yr, some NFL gamers knelt in the course of the Nationwide Anthem to protest remedy of black People, significantly by police. The protests sparked an issue, and the NFL put a ultimate determination on the protest on maintain.

“I felt just like the state of affairs was not a profitable state of affairs for the followers, the sponsors, the gamers and the homeowners,” he continued.

A couple of months after Schnatter referred to as out NFL management, Papa John’s ended its NFL sponsorship. Pizza Hut took its place.

Papa John’s is making an attempt to place each feedback, and Schnatter himself, behind it.

The corporate is stripping Schnatter’s picture from its advertising supplies and has taken the weird step of approving a provision that will stop him from gaining extra management of the corporate.

Ritchie went on a listening tour, mandated bias coaching for all workers and promised to extend range amongst workers. The corporate additionally launched a social marketing campaign acknowledging clients’ considerations.

Papa John’s has additionally commissioned an investigation into its range and inclusion practices.

Requested whether or not the investigation would discover any examples of misconduct by him, Schnatter mentioned: “On the finish of the day, I am the principal proprietor of the corporate.”

“They have to level unhealthy outcomes on someone, and that is in all probability going to be me.”

Correction: A earlier model of this text misstated the NFL’s place about gamers kneeling in the course of the Anthem.

CNNMoney (New York) First printed August 28, 2018: 7:21 PM ET

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