Schnatter had already apologized earlier in the day after Forbes.com reported that he used the racial slur while participating in a role-playing exercise designed to prevent public relations crises.
According to the account, Schnatter was on a call with Laundry Service, a marketing agency, and was asked how he planned to manage future public relations flare-ups.
Schnatter has had a bumpy road as of late. Last year, he caused controversy when he said that Papa John’s pizza sales were hurt by the NFL’s handling of players’ kneeling during the National Anthem in protest of racial injustice. He stepped down as CEO two months after the comments. It was hard to see why it was so offensive. The numbers didn’t lie. The NFL clearly lost fans and ratings over the same issue. It would only make logical sense that there would be a drop-off in pizza sales as a result of less fans paying attention to the game.
On his conference call in May with marketers, Schnatter sought to downplay the significance of his criticism of the league and its players.
“Colonel Sanders called blacks n—–s,” he said, complaining that Sanders had never received backlash.
Not stopping at the ‘N-word’, Schnatter recalled growing up in Indiana, where he said people used to drag black people from their trucks until they died.
Schnatter went on record stating his comments were intended to demonstrate his stance against racism, but that people on the call were offended by them.
In a statement issued through the company, Schnatter said: “News reports attributing the use of inappropriate and hurtful language to me during a media training session regarding race are true. Regardless of the context, I apologize. Simply stated, racism has no place in our society.”
Schnatter founded Papa John’s in 1984. He is the public face of the company and its largest shareholder, controlling 29%, and appears in its ads, including one that rolled out as recently as April.
Papa John’s is the third largest pizza chain (in sales) in the United States, trailing Domino’s and Pizza Hut. It has stores in dozens of countries around the world, including Latin America, Europe, the Middle East & Asia.
Laundry Service, which is owned by Wasserman Media Group, declined to comment through a spokesperson on Schnatter’s remarks or the company’s relationship with Papa John’s. It has been reported that Wasserman moved to end its contract with Papa John’s after the call.
Schnatter also resigned Wednesday from the University of Louisville board of trustees. The chairman, J. David Grissom, said: “After speaking with John, I’m confident that his comments, while inappropriate, do not reflect his personal beliefs or values.” He added that the members of the board don’t condone racism or “insensitive” language.
He also thanked Schnatter for his “generous support for so many years.” The University of Louisville football team plays its home games at Papa John’s Cardinal Stadium.
Papa John’s was the longtime exclusive pizza sponsor of the NFL but ended its partnership with the league earlier this year under new CEO Steve Ritchie.
Papa John’s (PZZA) said in a statement late Wednesday it would appoint a new chairman “in the coming weeks.”