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After resigning from the company, Papa John’s founder John Schnatter has now changed his mind.
Schnatter resigned on July 11 after being using the N-word during a conference call, but according to a letter obtained by CNN Money, he’s already regretting that decision.
He is alleging the company’s board urged him to resign based on hearsay rather than facts.
“The board asked me to step down as chairman without apparently doing any investigation. I agreed, though today I believe it was a mistake to do so,” he wrote in a letter to the board members. “I have checked with corporate governance experts who tell me that this was not a proper action by the board. At the last meeting, a few of you raised the issue of whether I should step down as a director. Once again, those individuals were acting on rumor and innuendo, without any investigation — let alone a third-party investigation of the facts.”
In the aftermath of the N-word backlash Schnatter was evicted from the company’s headquarters in Louisville and professional sports franchises have either suspended or entirely ended sponsorship deals with the embattled chain.
While Schnatter admits he did use the racial slur, he argues that the context he used it in is what matters most.
“I was asked if I was not racist, then why did I say what I did about the NFL situation? I said if you look at what I said, it was in no way racist. (The fact is, we completely mishandled the NFL situation from a public relations standpoint both the board of directors and company leadership.) I then said something on the order of, Colonel Sanders used the word “N,” (I actually used the word,) that I would never use that word and Papa John’s doesn’t use that word.”
The Laundry Service, a marketing firm, suggested he take a diversity course but after Schnatter took the class, he criticized Papa John’s PR tactics and in a bizarre twist of events, also accused the firm of extortion.
“The next day, May 23, the company made the decision — not me — to fire the Laundry Service with their last day being July 2. We owed them approximately $1.3 million. Of course, we said we would pay them what was owed, but they said they wanted $6 million because they claimed some of their people had been offended by what I had said,” he wrote. “Moreover, one of their attorneys said they would conduct a smear campaign against the company and me unless we paid them what he was asking for. Unfortunately, the company gave in to this extortion attempt and offered them $2.5 million or roughly $1.2 million more than they were owed.”
Schnatter wrapped up his letter with a vow that he would clear his name.
“I am confident that an examination of the facts will bear out what I have written in this letter and show that once again our company has demonstrated that it does not know how to handle a crisis based on misinformation. I will not allow either my good name or the good name of the company I founded and love to be unfairly tainted,” he wrote.