Papa John's founder and former CEO refuses to walk away without a fight.
John Schnatter sued the pizza chain Thursday (July 26) as part of what seems to be a larger mission to clear his name, and prove that he was wrongfully forced out of the company after Forbes reported that he used the n-word during a media training session.
Schnatter is suing to recover business and financial records. He chose the legal route, “because of the unexplained and heavy-handed way in which the company has treated him since the publication of a story that falsely accused him of using a racial slur.”
In the lawsuit, filed in a Delaware court, Schnatter repeatedly denies using the racial slur (despite issuing a public apology two weeks ago), and attacked Papa John's for the way the incident was handled. “Instead of standing behind the founder and working with the news media to explain what actually occurred, the company followed its usual, and flawed, manner of dealing with false and mistaken reporting.”
Schnatter, who still owns a reported $510 million stake in the company, reportedly uttered the slur during a conference call in May. Forbes retroactively reported the comments in a story published on July 11. A special committee of board members ousted Schnatter as board chairman hours later, and promptly evicted him from company headquarters.
Since the committee was formed three hours before the decision, Schnatter's lawsuit questions whether or not board members have been “grossly negligent or are acting in bad faith, or both.”
Papa John's responded to the lawsuit in a statement expressing sadness and disappointment, before calling the legal filing a “needless and wasteful” attempt by Schnatter to “distract from his own words and actions.” The company added that Schnatter will receive “all of the materials that he is entitled to as a director.”