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American Apparel: Worst Week Ever?

By Jenni Simcoe
Published: Friday, August 27, 2010, at 06:54PM
Dov Charney Eric Richardson

American Apparel CEO Dov Charney during a march for immigration rights on May 1, 2009.

Downtown-based American Apparel and controversial CEO Dov Charney are no strangers to international attention thanks to the company's salacious ad campaigns and sexually-charged reputation. This week, though, the clothing company's media spotlight has been thanks to its numbers, not its image.

The retailer has been facing financial troubles since last year’s immigration crackdown that caused the loss of 1,800 employees. In June, the company received a warning from the New York Stock Exchange that it was late filing financial reports. This week the company suffered several other setbacks that media reports say threaten to bankrupt it, leaving its future as the largest private employer Downtown up in the air.

On Monday, American Apparel announced that the company had received another letter from the New York Stock Exchange warning the retailer that the deadline was long past for the company to file a Quarterly Report. By not filing Form 10-Q on time, American Apparel is at risk of losing its listing on the NYSE.

The company has also been the target of up to three class action lawsuits in just two weeks over concerns that the company misled shareholders.

Shares of company, which trades as APP, fell to an all-time low of 66 cents per share on Wednesday. At the closing bell on Friday the shares had rebounded slightly to 82 cents.

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