Plaintiff Irene Morales. Courtesy of NY Daily News.
In the past, all of the lawsuits against Charney were settled and have never reached trial. Although this seems to be the most explosive one of them all, it is doubtful whether this one will reach the courtrooms either. American Apparel said in court papers Wednesday that Morales' complaint "is an improper attempt to garner media attention and exert pressure." Charney's lawyer, Stuart Slotnick, said Morales "made a number of extortion-like threats to expose the company to a threatened avalanche of litigation and negative publicity." Two documents were submitted to the court, supposedly signed by Morales agreeing not to sue the company. The hearing, deciding whether the case will reach the courts or be directed through arbitration processes, will be held on March 25. As if the company's $120 million debt weren't enough for Charney to handle, the additional threat of another $260 million makes the future of this company look even bleaker.
—Stacy Douek
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