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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of report (Date of earliest event reported):
January 3, 2000
PAPA JOHN'S INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 61-1203323
(State or other jurisdiction of (I.R.S. Employer identification
incorporation or organization) number)
2002 Papa John's Boulevard
Louisville, Kentucky 40299-2334
(Address of principal executive offices)
(502) 261-7272
(Registrant's telephone number, including area code)
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Item 5. Other Events
On January 3, 2000, a federal court judge in Dallas ruled that Papa John's can
no longer use its "Better Ingredients. Better Pizza." trademarked slogan. Papa
John's plans to appeal the ruling. The potential impact of the ruling on the
company's fourth quarter and full-year 1999 earnings is currently being
evaluated by management. The judge also permanently enjoined Pizza Hut from
broadcasting advertising, in any form, which compares any component of Pizza
Hut's pizza to a like component of Papa John's pizza. This summary of the
attached press release is qualified in its entirety by the complete text of such
document, a copy of which is attached hereto as Exhibit 99.1.
Item 7. Financial Statements and Exhibits
(c) Exhibits 99.1 Press Release dated January 3, 2000.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant had duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PAPA JOHN'S INTERNATIONAL, INC.
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(Registrant)
Date: January 10, 2000 /s/ E. Drucilla Milby
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E. Drucilla Milby
Senior Vice President,
Chief Financial Officer
and Treasurer
Exhibit Index
Exhibit No.
99.1 Press Release dated January 3, 2000
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Exhibit 99.1
FOR IMMEDIATE RELEASE
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For more information, contact:
Chris Sternberg Karen Sherman
Vice President, Corporate Communications Senior Director, Public Relations
502-261-4934 502-261-4987
Federal Court Strikes "Better Ingredients. Better Pizza."
Slogan In Unprecedented Advertising Ruling
Papa John's says ruling won't change its commitment
to quality or slow its momentum in the marketplace
Louisville, KY (January 3, 2000) - A federal court judge in Dallas ruled
today that Papa John's can no longer use its "Better Ingredients. Better Pizza."
trademarked slogan. But Papa John's executives vowed that the ruling will not
change its focus on quality which has made it the fastest growing pizza company
in America.
"This lawsuit won't change what we're about at Papa John's - always looking
for ways to make our customers a better pizza," said John Schnatter,
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Papa John's Founder and Chief Executive Officer. "After all, we've become the
fastest growing pizza company in America by consumers eating our pizza, not our
slogan."
Industry insiders have questioned whether the lawsuit was an attempt by
Dallas-based Pizza Hut to slow Papa John's momentum in the marketplace. Papa
John's and its franchisees opened 402 new restaurants in 1999, and are expected
to open a similar number in 2000. According to data from CREST, a leading
independent restaurant industry research firm, Papa John's sales were up 34% for
the year ending August 1999 versus the same period in 1998. For the three other
major pizza chains, including Pizza Hut, the growth rate was a combined 4% for
the same period.
The judge ordered that Papa John's print and broadcast advertising may not
include the slogan after January 24, 2000. Papa John's will have until March 3,
2000 to phase out its printed supply of other items containing the slogan and
until April 3, 2000 to remove the slogan from its restaurant signage. While
Pizza Hut asked for $12.5 million in damages and that any award be tripled under
the Lanham Act, the judge ruled that Papa John's must pay Pizza Hut only
$467,619.75 in damages.
Papa John's plans to appeal the ruling. The potential impact of the ruling
on the company's fourth quarter and full-year 1999 earnings is currently being
evaluated by management.
The judge also permanently enjoined Pizza Hut from broadcasting or
disseminating any television, radio or print advertising which compares any
component of Pizza Hut's pizza to a like component of Papa John's pizza. In
addition, Pizza Hut may not explicitly or implicitly state or suggest that a
Pizza Hut component is superior to a like Papa John's component unless the
superiority claim is supported by either scientifically demonstrated attributes
of superiority or taste test surveys, which demonstrate a statistically
significant preference for the Pizza Hut component.
The "Better Ingredients. Better Pizza." federally registered trademarked
slogan has been in use at Papa John's since 1995. While the verdict impacts
both pizza companies' advertising, only Papa John's slogan was at issue in the
lawsuit. It is anticipated that, given the ruling, Pizza Hut's "Best Pizzas
Under One Roof" slogan will also come into question.
"This verdict could significantly change advertising in this country," said
Syl Sosnowski, Papa John's Vice President of Marketing. "Can you imagine Chevy
being required to prove that its trucks are really "Like a Rock," KFC proving
that it "Does Chicken Right" or Pizza Hut proving it has the "Best Pizzas Under
One Roof?"
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For three years running, Papa John's has received the highest quality and
overall customer satisfaction ratings among national pizza chains in the
prestigious Restaurants & Institutions' Choice in Chains consumer survey. Papa
John's International, Inc. (NASDAQ: PZZA) is headquartered in Louisville,
Kentucky. At December 31, 1999, there were 2,276 Papa John's restaurants (590
company-owned and 1,686 franchised) operating in 47 states and six international
markets. Papa John's also owns or franchises 206 Perfect Pizza restaurants (15
company-owned and 191 franchised) in the United Kingdom. For more information
about the company, visit Papa John's at www.papajohns.com.
