Schnatter sues Papa John's board over chairmanship ouster

Schnatter sues Papa John's board over chairmanship ouster

John Schnatter wants to see the books and any record of the board discussions behind Papa John's board's decision to push the outspoken company's founder out of his board chairmanship. The suit, filed in Delaware, according to Forbes, asks a judge to give Schnatter access to any company documents related to the board's decision to request his resignation as chair.

The legal move is the latest action by the always-controversial pizza restaurateur to dash any expectation that he might go quietly away from the company he founded following news July 11 that he had used racial slurs during a media training call in May. Since then, Schnatter not only resigned his chairmanship, but the company's leadership has said it is removing the company founder's image from all marketing and kicking him out of his office at Papa John's Louisville headquarters.

The suit asks the court to give Schnatter and his attorney, Garland Kelley, access to all the requested documents 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," Reuters reported.

A statement from current Papa John's leadership denied Schnatter's claims and called the suit "needless and wasteful," Forbes reported. Though Schnatter admitted he used the highly derogatory term to refer to African Americans on the call, he said it was essentially taken out of context. 

Likewise, Schnatter — who remains on the company's board — said he regrets agreeing to resign his chairmanship of that body since he claims the board made that request based on "rumor and innuendo," according to a letter he sent to the board earlier this month.

Earlier this week, the board approved a provision that also prevents Schnatter from gaining any larger stake in the company, aside from the 30 percent he and other parties acting in his interest now have in Papa John's. The suit asked to see all the background records on the board's decisions involving his role in the company so he may ascertain if the board acted negligently or in bad faith. 

Papa John's issued a statement that leadership is providing "all of the materials he is entitled to as a (board) director."

Topics: Business Strategy and Profitability, Human Resources, Insurance / Risk Management

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