American Apparel Sues Dov Charney For Violating Agreement Over The Former CEO's "Scorched Earth Campaign"
Breakups are long and messy, especially in the corporate world. Less than six months after the company fired its CEO, American Apparel has sued Dov Charney for violating a standstill agreement that prevented him from tarnishing the company's re-branding efforts and trying to regain power. In other words, American Apparel is looking to move on from an awful ex who won't go away. The clothing company filed the lawsuit against its founder on May 15.
“In an unprecedented effort to disrupt and harm the company, Mr. Charney has launched a scorched earth campaign that exceeds all bounds of propriety," American Apparel lawyers wrote. "He is attempting in many respects to act as the ‘man behind the curtain,’ manipulating friends and company employees behind the scenes in a lame effort to obfuscate the fact that he is violating the Standstill Agreement in order to regain control of the company,”
So, what exactly is this "scorched earth campaign" that the ousted CEO is being sued for? American Apparel is simply giving Charney a taste of his own medicine after he filed a lawsuit earlier this month against hedge fund Standard General, seeking $30 million for defamation. He then sued American Apparel last week for mental and emotional distress. Charney was fired in December 2014 after allegations of sexual misconduct towards employees and misuse of company funds. He was replaced by new CEO Paula Schneider.
An American Apparel spokesperson declined to comment further beyond the statements in the company’s filing.