Operations

Papa John’s CEO, former CFO named in securities class action

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October 29, 2026

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Papa John's InternationalCEO Todd Penegor and former CFO Ravi Thanawala have been named as individual defendants in a securities class action alleging the pizza chain misled investors about the progress of its strategic transformation as North American comparable sales deteriorated, according to a news release.

The lawsuit was filed in the U.S. District Court for the Western District of Kentucky, Louisville Division and the lead plaintiff deadline is Nov. 2, 2026. The allegations have not been established as fact, and the filing does not itself determine liability.

The lawsuit covers investors who purchased Papa John's shares between Aug. 7, 2025, and Aug. 5, 2026. According to a press release from shareholder rights law firm Levi & Korsinsky, the complaint alleges that company executives portrayed the transformation as delivering results while internal information allegedly indicated continued market share losses and mounting challenges.

The case centers on Papa John's Aug. 6 announcement that it had lowered its 2026 North American comparable-sales outlookto a decline of 6% to 8%, from a previous forecast centered on a 3% decline, and suspended its dividend. The company also disclosed an 8.3% decrease in North American comparable sales. Papa John's shares fell $5.11, or approximately 17.2%, to close at $24.64 following the announcement, according to the notice.

The complaint alleges that Penegor and Thanawala had authority over company disclosures, access to internal sales and promotional data, and responsibility for financial reporting and certifications. It also questions the disclosure of approximately $22 million in supplemental marketing and franchisee subsidies tied to the company's 2026 promotional and innovation plans.

"Corporate officers have a duty to ensure their companies' public statements are accurate and complete," Joseph E. Levi, an attorney with Levi & Korsinsky, said in the release. He added the complaint contends that investors were told the transformation was working while conditions allegedly pointed to continued market share losses.