Dov Charney sues American Apparel shareholder Standard General

New York -- Dov Charney, the embattled founder and ousted CEO of American Apparel, is suing one of the retailer’s major shareholders, Standard General, for damages of at least $30 million.



Charney accused the hedge fund of an array of misdeeds, including defamation, false light, intentional interference with actual and prospective economic relations, unfair business acts and false advertising, according to a lawsuit filed Thursday in Los Angeles Superior Court.



The controversial Charney has been the subject of various claims over the years that he sexually harassed employees, and, more recently, that he misused corporate assets and abused his executive position.



Standard General had helped Charney buy additional stock when he tried to return to American Apparel. But it failed to back him when he attempted to be reinstated to his CEO job. Instead, the company fired Charney as chief executive in December after a subsequent investigation. Veteran apparel executive Paula Schneider was appointed the new CEO.



Charney disputes the fact an independent investigation was ever conducted.



"Nothing could be further from the truth," Charney's complaint states. "In reality, the Standard General-controlled American Apparel board of directors paid millions of dollars of the cash-strapped company's funds to American Apparel's outside general counsel Jones Day to manufacture various ex post facto excuses for the board's termination of Charney."



In a statement, Standard General said the facts will "speak for themselves."



"Dov Charney and his associates continue to file frivolous, meritless lawsuits at a breakneck pace," the company stated. "We are confident that Mr. Charney will be held accountable for this knowing, intentional abuse of the legal system."