Papa John's International's founder, blocked from the pizza chain's headquarters amid a deepening dispute with the rest of the board, is betting that franchisees and workers will have his back.
John Schnatter, who resigned as chairman last month, took out a full-page ad today in the company's hometown paper, the Courier Journal, to direct employees of the Louisville, Kentucky-based firm to a website he's launched, called SavePapaJohns.com. Papa John's has about 120,000 workers worldwide, including those at its franchises.
"The Board wants to silence me," Schnatter wrote on the website, which includes copies of legal documents in his fight with the pizza company. "So this is my website, and my way to talk to you."
Here is the text:
Dear Fellow Papa John's Team Members:
I miss you all very much. More than
words can express!
The Board will not let me talk to you and
that has been very difficult. I can only
imagine how difficult this entire situation
is on you, and I'm very sorry you all have
to go through this. You are the heart and
soul of this company - please know that
in every minute of every day you are all in
my thoughts and prayers.
Recently it has come to my attention
that you have been told that I want items
with my image or likeness removed from
the building and other Papa John's assets.
That is not the case at all. As you all
know, Papa John's is our life's work and
we will all get through this together
somehow, some way.
The website is part of Schnatter's bid for new leadership at the chain, which is struggling with declining sales and controversies related to his comments. The 56-year-old came under pressure after a July media report that he used a racial slur and descriptions of violence against minorities on a call with a media agency. He admitted to using the slur but said he was taken out of context.
Months earlier, he had exited the chief executive officer job over critical comments about the National Football League's national-anthem controversy. He's since said he regrets resigning.
"Papa John's is our life's work and we will all get through this together somehow, some way," Schnatter says on the website. "I can only imagine how difficult this entire situation is on you, and I'm very sorry you all have to go through this."
After the pizza chain reported weaker-than-expected earnings last quarter, Schnatter published a blistering critique of the company's leadership, including CEO Steve Ritchie.
The chain punched back, noting that Schnatter's controversy is weighing down performance, with North American same-store sales falling 10.5 percent in July. The chain has had to give financial assistance to franchisees who've been hurt by Schnatter's statements "to mitigate closings," it said.
On July 22, the company's board adopted a poison pill designed to prevent Schnatter from adding to his roughly 30 percent stake in a bid to gain majority control.
While Schnatter is appealing to the company's workers and franchisees, some restaurant owners have taken action to distance themselves from the founder. Franchisee groups across Florida issued statements last month stating they "do not share the same sentiments as the founder of Papa John's." Others have reported declines in sales.
Even so, Schnatter sees workers rallying around him.
"Know that in every minute of every day you are all in my thoughts and prayers," Schnatter said. He adds: "We are getting the truth out there."
-- Bloomberg News