American Apparel CEO Dov Charney's 'Sex Slave' Lawsuit Thrown Out

American Apparel's 'Sex Slave' Lawsuit Thrown Out

It appears that American Apparel's famous CEO may be out of hot water, for now.

A Brooklyn judge threw out a lawsuit Thursday accusing Dov Charney, head of the hipster chain, of using one of his employees as a "sex slave." The suit brought by 21-year-old Irene Morales last year alleged that Charney began sexually harassing her when she was 17 and held her "prisoner" in his apartment while she was forced to pleasure him sexually, according to the New York Post. The claim, which seeks $260 million, will now be heard in arbitration.

Four more former employees of the hipster clothing chain filed a suit against Charney shortly after Morales filed her suit, claiming among other allegations that the CEO brought one of them into his bedroom while he was wearing a towel, undressed her and tried to have sex with her.

The sexual harassment allegations are just some of the troubles American Apparel has faced in recent years. The company has been on the brink of bankruptcy at various points due to sluggish demand for its iconic zip-up hoodies and deep V-neck tees. Famed billionaire George Soros recently extended the company an $80 million credit line through Crystal Financial, a Boston-based firm where Soros is a top investor.

In addition to the money troubles, the company has also come under fire for some of its racy ads, including last year's Christmas campaign, which featured topless models in scarves.

American Apparel also may have recently riled up some of its hipster base when it installed sensors in its stores to prevent theft. The company allegedly used to have a policy that encouraged managers to turn a blind eye when the right type of customer lifted clothes from stores.

Still, the company's sales did increase by 13 percent in February compared to last year, according to MarketWatch.

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