After an intense battle that has been raging since June, American Apparel’s board has kept disgraced Founder and CEO Dov Charney, associated with the company he started, but perhaps not as CEO. Charney expects a decision from the board concerning the future of the company sometime next week. Charney was ousted by the board in June on charges of sexual harassment and of misusing funds. Charney vowed he would get his old job back, and with the help of Standard General, purchased 40% of the company and was able to pressure some board replacements, Bloomberg news reported.
Charney, aged 45, was American Apparel’s only CEO until now, and was trying to orchestrate a turnaround for the company, which was buried in $290 million of net losses since 2010. The FTI is investigating the reasons for Charney’s ouster, which includes inappropriate behavior during job interviews, allowing an employee to create a website defaming a co-worker and charging the company for personal expenses.
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Since Charney’s dismissal, Scott Brubaker has been serving as CEO, Patricia Honda was promoted to president of wholesale, Nicolle Gabbay became president of retail and Hassan Natha, formerly of Fisher Communications, Nike and Jones Soda, became CFO. The departure of CFO John Luttrell is good news for Charney, since the two often had intense disagreements even prior the scandals.
Currently, Dov Charney serves as a paid advisor to American Apparel, and although there is no clear indication whether or not he will get his old job as CEO back, the company seems keen to at least keep him on in an advisory role.
