Papa John’s Founder John Schnatter Resigns from University of Louisville Board of Trustees Amid Fallout Over Use of the N-Word

The fallout for Papa John’s pizza founder John Schnatter was swift Wednesday after he admitted to using a highly offensive racial slur during a May conference call, including his resignation from the University of Louisville board of trustees.

The pizza baron and self-made billionaire apologized for using the N-word after a report by Forbes magazine surfaced early Wednesday citing comments he made while discussing how to prevent future public relations fumbles with the company’s marketing contractor.

“News reports attributing the use of inappropriate and hurtful language to me during a media training session regarding race are true,” Schnatter said. “Regardless of the context, I apologize. Simply stated, racism has no place in our society.”

University of Louisville trustees Chairman J. David Grissom said in announcing the resignation that while Schnatter’s remarks were “inappropriate, (they) do not reflect his personal beliefs or values. No member of the board of trustees condones racism or insensitive language regardless of the setting.”

There was no escaping the irony that while attempting to avoid another public relations crisis, Schnatter touched off a new one. He ignited a firestorm last November when he blamed poor sales at Papa John’s on the NFL’s “poor leadership” in handling players’ demonstrations during the national anthem. White supremacist groups hailed the pizza maker, forcing the company to denounce their racist views.

On Wednesday, the free fall was swift:

• 5 a.m. EDT: Forbes’ story cites a source alleging that Schnatter was asked during a May conference call to role-play through scenarios to help him learn to respond to questions about racial issues. Asked how he would distance himself from racist groups online, Schnatter was quoted as saying that “Colonel Sanders called blacks n—–s,” but Sanders never faced backlash.

The report said Schnatter “also reflected on his early life in Indiana, where, he said, people used to drag African-Americans from trucks until they died.” The reference apparently was meant to show that he found racism deplorable, but the Forbes source said that multiple people on the call were offended.

• 10:30 a.m. Papa John’s releases a statement saying the company “condemns racism and any insensitive language, no matter the situation or setting.”

• 11 a.m. After opening at about $51 per share, the company stock hits a low, sliding below $48. After a minor rebound, Papa John’s market capitalization drops nearly $84 million on the day.

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SOURCE: USA Today; Louisville Courier Journal, Grace Schneider