Papa John’s Founder John Schnatter: ‘It Was a Mistake’ to Resign

John Schnatter (R), founder and chief executive of Papa John's Pizza, arrives at the 2011 American Music Awards in Los Angeles on Nov. 20, 2011. (Reuters/Danny Moloshok/File Photo)

Former Papa John’s pizza chief and its founder, John Schnatter, said that “it was a mistake” to step down as chairman after it emerged that he used a racial slur to describe black people in a conference call.

Schnatter resigned last week after apologizing for using the slur during a confidential training exercise with a marketing agency. Forbes magazine reported on the incident, citing unnamed sources that were on the call with him.

“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,” Schnatter said in a letter to the company’s board, according to the Wall Street Journal in a report on Tuesday.

He added: “I will not allow either my good name or the good name of the company I founded and love to be unfairly tainted.”

On Friday, Schnatter, 56, accused marketing firm Laundry Service, with whom he had the now-infamous conference call in May, of trying to extort him for $6 million to prevent his use of the racial slur from going public.

“They wanted $6 million to make it go away,” Schnatter said during an interview with WLKY. “They made it pretty clear. The words were, ‘If I don’t get my [expletive] money, I’m going to bury the founder. … I’m not for sale. They tried to extort us and we held firm and they took what I said and they ran to Forbes, and Forbes printed it.”

Neither Laundry Service or Papa John’s have publicly commented on his allegations.

Schnatter alleged in the WLKY interview that he was “kind of provoked” into using the slur in the call, and he thought that the content of the call would be confidential. He said that KFC founder Colonel Sanders had “called black people [the N-word].”

“This other party used that word a lot,” he said. He then added: “By the fourth or fifth pass, I just said, ‘No, we’re not gonna be part of any such thing. So-and-so used the n-word, and we don’t use the n-word, and we’re not gonna use the n-word. And that’s it.’ So, we kind of shut that down quickly.”

Schnatter again apologized for using the word, saying: “I don’t condone racism in any way. Period. It’s just wrong.”

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In the call, meanwhile, also spoke of growing up in Indiana, and reportedly said that “people used to drag African-Americans from trucks until they died.” A source told Forbes that he was trying to convey opposition to racism. The source said that other people on the call got offended.

In a press release on Sunday, Papa John’s said that the company will be terminating a sublease agreement with Schnatter, which allowed him to use office space in headquarters in Louisville, Kentucky.

The Sunday press release also said that the “company has specifically requested that Mr. Schnatter cease all media appearances, and not make any further statements to the media regarding the company, its business or employees.”