John Schnatter, Papa John's founder ,arrives at the 2012 Academy of Country Music Awards at MGM Grand Garden Arena on April 1, 2012 in Las Vegas. Photo Credit: Kathy Hutchins/Shutterstock

Former Papa John's chairman John Schnatter has accused the company's CEO of lying to oust Schnatter and save his own job, according to a Delaware Court of Chancery lawsuit that was unsealed on Thursday.

In a redacted complaint, Schnatter said Papa John's chief executive Steve Ritchie launched a “false and defamatory” campaign accusing Schnatter of racism, causing the company to suffer “irreparable harm” amid a battle for control with its outspoken founder.

The lawsuit, which was filed Aug. 31, accuses Ritchie of breaching his duty of loyalty to investors and targets the executive's senior leadership team and the company's general counsel with allegations of “serious and ongoing wrongdoing.”

The filing was Schnatter's latest salvo in his legal battle in Delaware for control of the company, after he resigned over a news story that he had used a racial slur during a company training session. Schnatter has denied using the word, but said he agreed to step down as chairman in the best interest of the company.

The company's stock declined following the controversy, and claims against Schnatter have produced a securities class action, which was filed last week in New York federal court.

In July, Schnatter filed a books-and-records suit seeking board documents related to his departure, saying Papa John's directors had been, at best, “grossly negligent” in their decision to fire him that same month. At worst, Schnatter said, the board had acted in bad faith by orchestrating a “coup” to ensure his ouster. Trial in that case is scheduled for Oct. 1.

However, Schnatter, who owns a 30 percent stake in Papa John's, painted a dire picture of the company's operations in the most recent filing, which alleges “extraordinary and ongoing damage” since the filing of his books-and-records suit.

“Simply put, the ability of the company to repair itself and properly function may not last until Oct. 1,” Schnatter's attorney, Patricia L. Glaser, wrote in the unsealed complaint.

In an emailed statement, Papa John's said the allegations were “entirely without merit” and vowed to defend the “baseless” claims in court.

“John Schnatter will do anything to distract attention from the harm caused by his inappropriate words,” the company said. “He continues to make reckless allegations in his attempt to regain control and serve his own interests.”

According to a letter Schnatter wrote last month to franchisees, Ritchie began mobilizing against him after Schnatter included the CEO on a list of executives that should to be fired for poor performance. When that failed, Schnatter said, Ritchie levied accusations of racism and accused Schnatter of “making up lies.”

“In other words, Mr. Ritchie placed his own self-interest and desire to salvage his own employment over the best interests of the company,” the complaint said.

“It is hard to imagine a more clear violation of the duty of loyalty than what Mr. Ritchie has done.”

The filing also included vague allegations of “sexual harassment or other misconduct” by members of Ritchie's senior leadership team. Schnatter said he reported the complaints in a letter to the company's human resources department, but women at the company were still exposed to acts of intimidation and retaliation.

A copy of the letter was attached as an exhibit to Schnatter's complaint, though it has not yet been made public.

Schnatter is represented by Glaser and Garland A. Kelley of Glaser Weil Fink Howard Avchen & Shapiroin Los Angeles and Peter B. Ladig and Brett M. McCartney of Bayard PA in Wilmington.

The case, captioned Schnatter v. Shapiro, has been assigned to Chancellor Andre G. Bouchard.