Behind the blowup
Schnatter dishes on hot mess at Papa John’s
The bad blood between John Schnatter and his handpicked successor at Papa John’s, Steve Ritchie, runs deep.
They were once close, but the rancor became clear last month when Ritchie, the pizza chain’s chief executive, in a faceoff with then-chairman of the board, called Schnatter an “a--hole,” the Papa John’s founder told The Post.
“We were in the middle of discussing hiring a new p.r. executive, Madeline Chadwick,” Schnatter recalled, “and Ritchie said ‘too bad she has to work for an a--hole.’ ”
Schnatter, once a mentor to the former hourly worker who rose through the ranks to become its CEO, said he reported the incident to HR. Schnatter said his assistant, Stacy Hadley, heard the exchange.
“I said to Stacy, ‘Where’s this anger coming from?’ ” the chain’s founder said.
Schnatter thinks he knows the answer.
In June, just weeks before the faceoff, he’d begun to work on a performance evaluation of Ritchie, who became CEO on Jan. 1 after Schnatter was asked to step down from the post following his remarks about NFL players taking a knee during the national anthem.
Schnatter blamed the mishandling over the NFL situation for Papa John’s slowing sales. The pizza chain was a longtime sponsor of the league, and the comments began to sour the board on Schnatter.
The NFL dropped the company as a sponsor in February.
At the time of Ritchie’s promotion from president to CEO, Schnatter couldn’t heap enough praise on his protégé.
“I am so proud of Steve — he has excelled at every job he’s ever held at Papa John’s ... We couldn’t have a more proven leader to guide Papa John’s through its next stage of growth,” he said in a statement.
But six months — and two disappointing quarters later — Schnatter says his confidence in Ritchie had changed.
He began working on a performance evaluation for Ritchie’s annual review, due in July, making the case to the board that the CEO was not qualified to reverse the company’s declining financial performance.
Sales fell 4.9 percent in the first quarter and profits missed expectations.
The evaluation was sitting on the company’s servers and had been e-mailed back and forth between him and his assistant.
Schnatter believes that a woman in the IT department who was dating a close ally of Ritchie shared the review with CEO.
The now-toxic relationship between Schnatter and the company shows the perils of what can happen when a charismatic founder who is a large shareholder goes off the rails.
Following the NFL matter, Schnatter ran into more trouble in July when it was reported that he used the Nword during a May internal conference call — ironically held to give the executive media training.
The Papa John’s board quickly convened on July 15 and barred him from speaking about the chain. They are also in the process of erasing his name and image from all marketing materials. He was also removed as chairman.
Despite the shattered relationship, Schnatter still believes he is the best face of the company and that it was a mistake to remove him as a spokesman. He is not going quietly.
Schnatter has sued the company to get hold of documents he feels will clear him and his reputation — and prove Ritchie got hold of his evaluation.
A Papa John’s spokesperson declined to comment on matters related to Schnatter’s allegations.