American Apparel finally ousts maverick boss Dov Charney

Jun 19, 2014

'The company has grown much larger than any one individual' say directors, as founder goes overboard

Stephen Shugerman/Getty Images

One of America's most controversial company bosses, Dov Charney, founder of American Apparel, is being ousted over "alleged misconduct". He has been sacked as chairman and the board has declared its intention to drop him as chief executive in 30 days' time.

Charney is as famous for the sexual harassment suits he has attracted down the years, and for AA's provocative billboard ads, as he is for growing the company into a worldwide womenswear brand. 

The downside is that despite sales of more than $600 million a year, American Apparel hasn't posted a profit since 2009. 

Fellow directors are refusing to comment on the particulars, saying only: “The board’s decision to replace Mr. Charney grew out of an ongoing investigation into alleged misconduct."

“We take no joy in this, but the board felt it was the right thing to do,” Allan Mayer, one of the directors who will now become co-chairman, 

added. “Dov Charney created American Apparel, but the Company has grown much larger than any one individual and we are confident that its greatest days are still ahead.”

Only four months ago, Charney was on typically bullish form when asked by Buzzfeed how things were going at American Apparel. Despite the share price having fallen from a high of $14 to below $1, Charney, 45, said he had no intention of stepping aside.

“I don’t have people bursting in my house yet telling me to take a hike,” he said. "

I’m in my mid-forties so I’m building a team and I’m widening it, but I’m just cracking my knuckles and getting started. When I’m in my mid-fifties, I’m going to start looking at how to widen, you know, start passing on the torch completely. But right now, I’m just figuring where I want to drive the bus.”

Canadian-born Charney has rarely been out of the headlines in his 17 years at the helm: sometimes for good reasons –  all those colourful shorts and bikinis are made in the USA, not abroad – but often for all the wrong ones.

A succession of harassment suits from employees included one from Irene Morales, who claimed to have been used by Charney as a personal sex slave.

She told a Brooklyn court that on her 18th birthday he had called her to his apartment in Manhattan where he answered the door in his underwear and "forced her to her knees so she could pleasure him". 

As The Guardian reports, Charney has dismissed this and similar claims as "sexual shame tactics". In Morales's case, her complaint came after she had – according to American Apparel - broken the terms of her leaving agreement.

Stories of his exhibitionism include frequent patrols of the American Apparel headquarters in is underwear. He is also claimed to have said "there wouldn't be anything wrong" with wearing a "cock sock" to a business meeting.

American Apparel billboards have attracted legal scrutiny, too. In the UK, the Advertising Standards Authority banned an American Apparel ad that had appeared in Vice magazine for using a model believed to be under 16 who looked like "she was stripping off for an amateur-style photo shoot".

Among those who have chased Charney through the courts is the film director Woody Allen. In 2009 he received $5m in an out-of-court settlement for having his image used by AA on billboards without his consent.

The campaign showed Allen dressed as a Hasidic Jew, in a scene from in his 1977 hit film Annie Hall in which Allen, feeling out of place at a dinner hosted by his girlfriend's non-Jewish family, imagines himself as an Hasidic Jew. 

Charney argued that the campaign was intended to show how similarly he and Allen - both high-profile Jews - have been treated by the media because of their supposed involvement in sexual controversies.

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