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American Apparel has won a victory in the latest round of legal battles between the company and its enigmatic former CEO Dov Charney. A judge has issued a temporary restraining order which prohibits Charney from trash talking against the company which he founded and once led, or any of its employees – especially the board.
The order, issued Monday by the Delaware court of chancery, also blocks Charney from trying to remove any of the board’s current members. It expires in July.
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It’s kind of like a very public divorce between two celebrities who, once in love, have become very hostile to one another. Think Kim Bassinger and Alec Baldwin or David Duchovny and Tea Leoni. Each side brings its case before the media in an attempt to woo public support.
But then it backfires because people just see them as petty, vindictive crybabies. So too with American Apparel and Dov Charney.
This is what has been happening between Dov Charney and American Apparel for almost a year now. Just read our coverage and see how much hotter things got since Charney’s ouster in December.
In short, Charney was ousted as CEO for a number of reasons and then led a failed hostile takeover bid to regain control of the company. Now the two sides are suing each other.
“The company cannot and should not be in the business of constantly responding to Mr. Charney’s disruption, disparagement and lawsuits, much less any takeover attempt, ” American Apparel said in its complaint which it filed last month.
Responding to the ruling, Charney’s lawyer Stephen Brauerman said, “The court’s order is temporary in nature. We haven’t had the ability to fully challenge them, but Mr. Charney intends to comply with the court’s order.”
Dov Charney is still the largest shareholder in American Apparel, which he founded in 1998. He is currently suing the company for $20 million, accusing it and current Chairwoman Colleen Brown of defamation.
