Papa John's is confronting its crisis: Customers think it has a racism problem. 
 
 In a new ad, the pizza chain shows some of the furious messages it received after its founder blamed NFL protests for poor sales and later admitted using the N-word. 
 
 "Racism is disgusting and I won't support it," one person wrote. Another said that "blaming players for poor sales with dog whistle racism was a hack move." 
 
 Between the messages, words from the company appear on the screen. 
 
 "You expected better from Papa John's. So did we," the company writes. "Thank you for your honesty ... It is making us better." 
 
 Papa John's is struggling with declining sales, especially since founder John Schnatter was forced to resign as chairman in July, after his use of the slur came to light. 
 
 Schnatter has since said it was a mistake to resign, and is now attacking CEO Steve Ritchie in an apparent bid to regain control. 
 
 The ads recall those put out by Facebook (FB), Uber and Wells Fargo (WFC) after PR crises at those companies. All of those ads acknowledged customer concerns, although with varying degrees of directness. 
 
 The company has taken great pains to distance itself from Schnatter, removing his image from marketing materials, kicking him out of his office and trying to stop him from gaining more control of the company. 
 
 "The video produced by the Company represents another example of the Company attempting to hide the true facts," a spokesman for Schnatter said in a statement. He added that fans have called for Schnatter's return to the company. 
 
 Papa John's also announced Friday that it will roll out mandatory bias training for its workers. 
 
 Training will start in October at the corporate office and at corporate-owned stores, which make up about 20% of its the chain's US restaurants. The Papa John's leadership team finished their own training two weeks ago. 
 
 The program will include conversations about unconscious bias, racial and cultural sensitivity and managing bias. 
 
 In an open letter, Ritchie said Papa John's is also conducting an internal audit on diversity and inclusion practices, launching a program to support minority-owned franchises and starting a foundation focused on local communities. 
 
 Ritchie said he was "personally committed to adding more diversity to the leadership team of Papa John's." 
 
 Papa John's has hired Bank of America and Lazard to help stabilize the business, a source told CNNMoney on Friday. The source declined to give further details, and Bank of America and Lazard declined to comment. The news was reported earlier by Reuters. 
 
 Papa John's also seems to be following a similar playbook to that of Starbucks (SBUX), which mandated anti-bias training after two black men were arrested while waiting for a friend at a Philadelphia location. 
 
 Starbucks closed about 8,000 stores for an afternoon to conduct the elaborate training, which tapped the musician and activist Common as a virtual session leader and relied on the guidance of more than 30 experts. ||||| Buy Photo John Schnatter, founder of Papa John's Pizza (Photo: The Courier Journal file photo)Buy Photo 
 
 Attention Papa John's employees: Papa says he still loves you. 
 
 Escalating his battle with the company he founded, ousted Papa John’s chairman John Schnatter tells "fellow team members" in a full-page ad in Wednesday's Courier Journal that he misses them “more than words can express” and that “we will all get through this together.” 
 
 In the ad, which was placed by the firm handling Schnatter’s public relations, the founder of the world's third-largest pizza company says current managers “will not let me talk to you and this has been very difficult.” 
 
 The open letter to employees doesn’t specify whether Schnatter wants to return as chairman, but he tells them “you are the heart and soul of this company” and “in every minute of every day you are all in my thoughts and prayers.” 
 
 More coverage 
 
 ► John Schnatter on sales drop: Papa John's 'performs better with me' 
 
 ► The rise and fall of John Schnatter: His mouth was his own worst enemy 
 
 ► 'Papa John' Schnatter: Black people know 'I’m not a racist' 
 
 ►U of L is pulling Papa John's off Cardinal Stadium after N-word scandal 
 
 The ad also directs readers to a new website www.savepapajohns.com, on which he says: "The board wants to silence me. So this is my website, and my way to talk to you." 
 
 The site includes a letter from one of Schnatter's lawyers challenging the company's right to lock him out of the company's headquarters and another complaining that it has stopped subsidizing security at his Anchorage mansion. 
 
 In a statement, the company said: “Stakeholders, including customers, franchisees, employees, and investors, have expressed strong support for the actions we have taken to separate our brand from Mr. Schnatter. No matter what John does, he will not be able to distract from the inappropriate comments he made.” 
 
 Papa John's has about 1,200 employees in Louisville, including 650 in its corporate headquarters. Including workers at its franchises, it has about 120,000 employees worldwide. 
 
 Schnatter vowed earlier this month that he is “not going away and will continue to fight to do what’s best for the company and its employees, franchisees, shareholders and customers.” 
 
 He resigned from the board on July 11 after Forbes disclosed that he had used the N-word in a media training session in May, but he later said quitting was a mistake. He has sued the company seeking documents that detail what he calls the “heavy-handed” way the company has treated him. 
 
 The ad ramps up the conflict between Schnatter, who owns nearly 30 percent of the company and remains on its board, and the company’s management, including CEO Steve Ritchie, Schnatter's handpicked successor. Schnatter has since criticized Ritchie's performance and demanded his firing. 
 
 More coverage 
 
 ► 'Papa' John Schnatter says he was justified in actions against CEOs 
 
 ► Schnatter says he shouldn't have resigned from Papa John's 
 
 ► John Schnatter resigns from University of Louisville board of trustees 
 
 ► Papa John’s embattled CEO Steve Ritchie braces for fight: 'Pizza is my life' 
 
 An analyst who follows the pizza industry said the “ongoing drama” between Schnatter and management was “destroying shareholder value,'' while another said "a complete separation" of Schnatter from the business "is the right thing to do," though the founder is "digging in his heels." 
 
 Forbes reported Saturday that pictures of Schnatter have disappeared from corporate offices, including an image of his face painted on a ceiling. During an employee town hall on Aug. 14, Ritchie told employees that Schnatter requested the items be removed, Forbes reported. 
 
 Schnatter's missive to his former employees disputes that. 
 
 “This is not the case at all,” the ad says. “As you all know, Papa John’s is our life’s work and we will all get through this together, somehow, some way.” 
 
 The open letter closes with “Your Founder" and Schnatter’s first name. 
 
 Terry Fahn, a Schnatter spokesman who works for Sitrick and Company, the Los Angeles-based firm retained by Schnatter, would not comment on the ad. Nor would Fahn say what Schnatter hopes to accomplish with it. 
 
 The ad does not address Schnatter's remarks during a training session. He has said he didn't use the N-word as a slur and that his remarks were taken out of context. 
 
 More coverage 
 
 ► Papa John's can't remove John Schnatter from board right away 
 
 ► Papa John's estimates $30 million to $50 million cost this year from crisis 
 
 ► Vowing to fight Papa John's, Schnatter hires Harvey Weinstein's lawyer 
 
 ► After racial slur revealed, fall comes swiftly for Papa John Schnatter 
 
 Even before Schnatter stepped down as chairman, he was in a pitched battle with management over the company’s direction and his role as brand spokesman. 
 
 Ritchie, who was elevated to CEO on Jan. 1, blamed Schnatter for causing sales to plummet last November when Schnatter blamed sagging sales on the NFL’s handling of player protests during the national anthem. 
 
 Ritchie told analysts earlier this month that Schnatter’s comments were “inexcusable and irresponsible” and repairing the damaged brand could cost as much as $50 million. 
 
 The president of the Papa John's Franchise Association, Vaughn Frey, also said it's time for Schnatter to move on. 
 
 But Schnatter counters, saying that Papa John’s earnings began to fall before the NFL controversy — when Ritchie was in charge of the company’s day-to-day operations. 
 
 Papa John's stock (Nasdaq: PZZA) closed at $42.92 per share Tuesday, down from a high of $80.80 exactly a year ago. 
 
 Andrew Wolfson: 502-582-7189; awolfson@courier-journal.com; Twitter: @adwolfson. Support strong local journalism by subscribing today: www.courier-journal.com/andreww 
 
 Support our journalism Become a Courier Journal subscriber today to support stories like this one. Get unlimited digital access here! 
 
 Read or Share this story: https://www.courier-journal.com/story/news/2018/08/21/john-schnatter-publishes-open-letter-papa-johns-employees/1053597002/ ||||| John Schnatter, who founded the Papa John's pizza chain in the 1980s, is leaving the chief executive seat. 
 
 He'll stay on with the company as its chairman, the company said Thursday in a press release. Replacing him is Steve Ritchie, the current chief operating officer. The change will take effect on January 1, the company said. There was no reason given for the change in leadership. 
 
 The shakeup comes after a string of public relations debacles and slumping sales. 
 
 Papa John's is a major NFL sponsor, and Schnatter wasn't shy about sharing his thoughts about players who took a knee during the national anthem to protest the treatment of black Americans, particularly by police. 
 
 President Trump earlier this year publicly criticized players who chose to kneel, ratcheting up the controversy. 
 
 "This should have been nipped in the bud a year and a half ago," Schnatter said on a conference call with investors in November. "The controversy is polarizing the customer, polarizing the country." 
 
 During the call, he also blamed the controversy for dismal sales. 
 
 Related: Papa John's says it didn't mean to be 'divisive' on NFL protests 
 
 Backlash ensued on social media and his remarks were criticized by those who argue the players are exercising free speech and should be permitted to do so. Late-night comics lampooned Schnatter. 
 
 And, adding to the ordeal, the white supremacist website Daily Stormer floated the idea that Papa John's was the "official pizza of the alt-right." 
 
 That forced the Louisville, Kentucky-based Papa John's to issue a clarifying statement asserting, "We condemn racism in all forms," according to the Courier-Journal. 
 
 About two weeks after Schnatter made his controversial comments, the company attempted an apology on Twitter. 
 
 Related: Papa John's says NFL protests are hurting sales 
 
 "The statements made on our earnings call were describing the factors that impact our business and we sincerely apologize to anyone that thought they were divisive," the tweet read. "That definitely was not our intention." 
 
 The pizza chain said that it supports "the players' movement to create a new platform for change" but that it also believes that "as Americans, we should honor our anthem." 
 
 "We will work with the players and league to find a positive way forward. Open to ideas from all. Except neo-nazis," the company tweeted, offering a "middle finger" emoji to "those guys." 
 
 Papa John's has also faced waning sales recently. The company's stock price is down more than 30% so far this year. 
 
 Ritchie, Schnatter's replacement, joined Papa John's as a customer service rep in 1996 making $6 per hour. He went on to own a Papa John's franchise, and in 2014 he was promoted to chief operating officer. 
 
 --CNNMoney's Ahiza Garcia and Rob McLean contributed to this report. ||||| The founder of Papa John’s International Inc. PZZA 1.27% vowed to fight the pizza chain over how it pressed him to step aside for his use of a racial slur, in a controversy that is casting fresh attention on the handling of race issues in corporate America. 
 
 John Schnatter last week publicly apologized for using the slur during media training over the phone with a marketing agency, which was intended to prepare him for returning to his role as brand spokesman. Days later, in a letter to the directors reviewed by The Wall Street Journal, he said he regretted giving up the chairmanship and accused the board of failing to investigate the nature of the phone call and the intention behind his use of the racial slur. 
 
 He said in the letter that he wasn’t a racist and that while he articulated the word in a discussion, he didn’t do so as a racial epithet. 
 
 “The board asked me to step down as chairman without apparently doing any investigation. I agreed, though today I believe it was a mistake to do so,” Mr. Schnatter said in the letter, dated Saturday. “I will not allow either my good name or the good name of the company I founded and love to be unfairly tainted.” 
 
 Papa John’s declined to comment Tuesday, but the company has distanced itself from the man who founded the company 34 years ago. It said in a press release over the weekend that Mr. Schnatter is no longer allowed to use office space at corporate headquarters in Louisville, Ky., and that he would no longer be in any advertising or marketing materials. 
 
 Mr. Schnatter on Tuesday visited the corporate headquarters to talk informally to employees and received hugs from people as he walked the halls, according to a person who witnessed his visit. 
 
 Mr. Schnatter remains a board member and, according to regulatory filings, as of March he owned 29% of Papa John’s shares, currently valued at about $500 million. The board doesn’t have the authority to remove him as a director and it will be up to shareholders at the next annual meeting in May to decide whether to re-elect him. 
 
 The man who built his eponymous pizza chain into the world’s third-largest pizza-delivery company had withdrawn from appearing in ads following a dustup over comments he made in November in connection with the National Football League’s handling of the players’ national-anthem protests. Papa John’s was the official pizza of the NFL, and Mr. Schnatter blamed a sales slide at the chain on declining TV football viewership amid the anthem controversy. 
 
 It was in sessions in May aimed at his re-emergence in branding that Mr. Schnatter used the racial slur. 
 
 In Saturday’s letter to the board, Mr. Schnatter wrote, the telephone call that month with digital marketing agency Laundry Service was intended to prepare him for questions he might be asked by reporters. When asked during the call whether he is racist, he answered “no,” he said, according to the letter. 
 
 “I then said something on the order of, Colonel Sanders used the word ‘N,’ (I actually used the word), that I would never use that word, and Papa John’s doesn’t use that word,” he said in his letter. 
 
 He also said in his letter that the marketing agency suggested Papa John’s retain rapper Kanye West to appear with him in ads and that he resisted that suggestion because Mr. West uses the “N-word” in some songs. 
 
 Laundry Service declined to comment. 
 
 Some people who consult on corporate diversity programs were unsympathetic to Mr. Schnatter’s contentions. While more companies are having frank conversations about race in the workplace, there are limits to how far the candid talk can go, these people say. 
 
 Alexis McGill Johnson, who recently helped design anti-bias training for tens of thousands of Starbucks Corp. employees, said she has never had anybody use the N-word in workshops led by her company, Perception Institute. Trainers don’t explicitly say workers can’t use such words but “it’s kind of obvious,” she said. “I’ve never had anybody say anything blatant.” 
 
 Joelle Emerson, founder and chief executive of Paradigm, a consulting firm focused on inclusion, works with business leaders on diversity issues and has never encountered an executive who used the slur in a meeting. She said termination is the right outcome for an executive who crosses that line. “When a white leader uses that word in the corporate setting I don’t think there are two options about how to handle it,” she said. 
 
 After Papa John’s sought Mr. Schnatter’s resignation last week, and he agreed, he came to feel that he had acted rashly out of embarrassment about how the situation was construed, and now regrets the decision, according to people familiar with his thinking. These people said he also regrets stepping down as CEO in December following the NFL controversy. 
 
 Mr. Schnatter, who has hired Los Angeles trial attorney Patricia Glaser to help him with the current controversy, has drawn criticism in other situations, including in 2012 when he said that providing health insurance to employees under the Affordable Care Act would result in costlier pizza. 
 
 The company has struggled recently, posting a 4.9% decline in first-quarter total revenue, and the damage from the latest controversy has led it to work on regaining trust with consumers. Everything from a possible sale to a rebranding of the company is on the table, according to people familiar with the matter. 
 
 In a letter that Papa John’s Chief Executive Steve Ritchie addressed to customers last week, he said the company is appointing an outside expert to audit the company’s policies and procedures related to diversity and inclusion. “Racism and any insensitive language, no matter what the context simply cannot—and will not—be tolerated at any level of our company,” Mr. Ritchie said in the letter. 
 
 The board’s lead independent director, Olivia Kirtley, sent Mr. Schnatter a letter last week saying the board wished to discuss his full board resignation at a meeting that took place over the phone Sunday night, people familiar with the matter said. Ms. Kirtley couldn’t be reached for comment. That letter prompted Mr. Schnatter’s letter. 
 
 “I am confident that an examination of the facts will bear out what I have written in this letter and show that once again our company has demonstrated that it does not know how to handle a crisis based on misinformation,” he wrote in his letter. 
 
 —Rachel Feintzeig contributed to this article. 
 
 Write to Julie Jargon at julie.jargon@wsj.com
– "I'd rather have frozen pizza than racist pizza." So reads a customer tweet about Papa John's, and it's not one the pizza company is shying away from. Quite the contrary, the message is highlighted in the chain's first new ad since John Schnatter was forced to resign last month over his use of the n-word. In the 65-second ad posted to social media Friday, a series of angry tweets are displayed, then the words, "You expected better from Papa John's. So did we." Then, after showing more tweets, the words "Thank you for your anger" appear. That last word is subsequently replaced with "criticism" and "honesty." "It is making us better." CEO Steve Ritchie also posted extensive comments on Twitter, which you can read here, and a letter to customers, which you can read here. CNN reports the company plans to hold mandatory bias training sessions beginning in October at its company-owned stores and is going live with a minority-owned franchise expansion and development program. The ad certainly hasn't abated Schnatter's anger. A rep for the former CEO had this to say, per CNBC: "The video produced by the company represents another example of the company attempting to hide the true facts. It omits the avalanche of comments made by customers, employees, and others who support John Schnatter and feel that the company is wrong."