John Schnatter, the ousted former chairman of pizza restaurant chain Papa John’s, may be in support of an investment from Starboard Value LP into the chain, but he’s still not friendly with the chain.
While he has welcomed the investment from the hedge fun, he filed an updated lawsuit recently against Papa John’s.
In his amended lawsuit filed under seal in the Delaware Court of Chancery, Schnatter is planning to undo a new provision of a voting agreement between Papa John’s and Starboard that requires the hedge fund vote its company shares in favor of Papa John’s preferred directors.
“Such a provision serves only one purpose, to further entrench the prior board, one that has repeatedly proven itself willing to place its own self-interest above that of shareholders,” Schnatter said in a statement.
As far as the investment from Starboard, “Mr. Schnatter welcomes the comments that have come from Mr. Smith and the company in the past few days,” Schnatter’s attorney Garland Kelley said. “Today’s amended lawsuit reflects support for Mr. Smith and his plans to invigorate the company for the benefit of all shareholders.”
Papa John’s announced that Starboard will invest up to $250 million into the company and named the fund’s chief executive, Jeff Smith, as its chairman. Schnatter stepped down from his role as chairman las summer after using a racist remark on a conference call.
Schnatter, who still owns around 30% of the company, wants to gain more control of the chain. With the Starboard investment, the number of directors jumped to nine from six, diluting his influence.
It was last summer that Schnatter resigned as chairman from the company after it was revealed that he had made racist remarks on a conference call. He has since regretted the move and has been relentlessly trying to reclaim his company since resigning. The ousted chairman has started https://savepapajohns.com/ in an effort to get the truth out.