Papa John's founder apologizes after reportedly using slur

Papa John's restaurant exterior. Papa John's Pizza is the fourth largest take-out and pizza delivery restaurant chain in the United States

Forbes reported that the incident took place on a call arranged between Papa John's executives and Laundry Service as a role-playing exercise for Schnatter to prevent future public-relations missteps. According to Forbes, Schnatter tried to downplay his past controversies by saying that Colonel Sanders - the founder of KFC - called black people the N-word.

But on Wednesday, Mr. Schnatter acknowledged as true a report that he had used the n-word in a conference call in May.

"Regardless of the context, I apologize", the statement says. "Simply stated, racism has no place in our society", Schnatter's statement said. The 56-year-old heavily criticized NFL for allowing players to take a knee during National Anthem protests and even blamed them for causing a slump in his pizza sales.

Yum Brands Inc's Pizza Hut replaced Papa John's as NFL's sponsor in February, ending Papa John's eight-year relationship with the top United States football league.

Papa John's issued an apology after the November 1 conference call distancing itself from Schnatter's comments. In his response, Forbes reported that he questioned why he was facing the wrath of society for taking a stance that all National Football League players should stand for the anthem, and he downplayed the significance of those comments.

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Schnatter then went on to describe his early life in IN, a place, he said, where Black people used to be dragged from trucks until they died.

That comment and others disturbed multiple people on the call, Forbes' source said, according to the report. The ensuing backlash proved the position earned Papa John's the worst kind of fans: the alt-right.

Also in May, although the timing is unclear, Papa John's then-CMO Brandon Rhoten, who picked Laundry Service as the chain's creative agency of record (replacing Grey) and had been with the company roughly a year, was pushed out.

"Papa John's condemns racism and any insensitive language, no matter the situation or setting", the company said in its own statement.

Papa John's shares fell almost 5 percent on the news Wednesday, dipping from a high of $51.04 shortly after the opening bell to $48.42 per share by the close. Papa John's sales were down 3.9 percent across the country from October through December versus the same period from 2016, according to ESPN.

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