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American Apparel CEO Dov Charney suspended and terminated for alleged misconduct

Controversial American Apparel CEO suspended by board

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The board of American Apparel voted on Wednesday to oust controversial CEO Dov Charney – a decision they said “grew out of an ongoing investigation into alleged misconduct”.

The board of directors have notified Charney of its intent to terminate his employment as president and CEO “for cause” following a 30-day cure period required under his employment agreement.

John Luttrell, the executive vice president and CFO, has been named as the interim CEO.

The board has also appointed Allan Mayer and David Danziger as co-chairmen to replace Charney as Chairman of the Board.

“We take no joy in this, but the Board felt it was the right thing to do,” Mayer said. “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.

“The Board is working with a search firm to identify candidates for the job of permanent CEO and, based on our initial discussions with the search firm, we expect the list of possible successors will be impressive.”

He also said the new chapter of American Apparel will be “the most exciting one yet”.

The Board’s decision comes after alleged misconduct relating to repeated allegations of sexual harassment by employees over the years, with seven women at one point filing suits against him. Many of these cases, however, have been dismissed.

In 2012, Charney was also accused in a wrongful termination suit for choking and rubbing dirt in the face of an employee. The company denies the allegations.

The LA Times reported a source “close to the matter” saying Charney would not have been expecting this outcome.

“He was totally taken by surprise, which is part of the problem,” the source said. “He’s going to fight like hell to get this company back, but he won’t succeed.”

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