Ousted CEO Charney Files Two More Lawsuits against American Apparel

LOS ANGELES, United States — American Apparel Inc said its ousted Chief Executive Dov Charney filed two more lawsuits against the company alleging defamation, representation in false light and claims for securities fraud.

The new lawsuits follow several that Charney has filed since he was suspended as CEO last June for allegations including misuse of company funds, violation of company policy and misuse of corporate assets. Charney was dismissed in December.

Charney filed a lawsuit on June 19 in the Superior Court of California against the company and a former director, alleging defamation, representation in false light, intentional interference with economic relations and a violation of the state's unfair competition law.

Later, on June 24, he filed a lawsuit in the same court against American Apparel, a former CFO, Standard General L.P and other current and former directors alleging claims for securities fraud, misrepresentation, breach of fiduciary duty, conspiracy and emotional distress among others.

American Apparel said the claims were without merit and that it would vigorously dispute their validity. The company did not detail how much, if anything, Charney was seeking in damages.

Earlier this month, American Apparel was granted a restraining order against Charney which temporarily stops him from breaching terms of a standstill agreement signed last year.

American Apparel's shares closed up 3.6 percent at 52.9 cents on Thursday. They were marginally higher in extended trading.

The cases are in re: American Apparel Inc, Superior Court of the State of California, No. BC 585664 and No. BC 586119.

By Yashaswini Swamynathan; editor: Savio D'Souza.