American Apparel Details Allegations of Sexual Misconduct By Ousted CEO

By Alex Dobuzinskis

Clothing company American Apparel has accused ousted founder Dov Charney of using ethnic slurs against workers and keeping videos on a company server of himself in sex acts with models and employees, recently filed court papers show.

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American Apparel's board of directors suspended Charney as CEO a year ago, citing his misuse of company funds, violation of company policy and misuse of corporate assets, and in December the board terminated him.

Charney's ouster was a dramatic fall from power for a clothing trend-setter who, early in his career, won acclaim for making apparel in the United States when the bulk of the industry was producing overseas.