Update: The New York Post reports that a Brooklyn judge has temporarily halted the lawsuit. The paper writes: Stuart Slotnick, Charney's lawyer, said in court papers that Irene Morales was bound by an agreement that all disputes would go to arbitration....Slotnick said Morales 'brought this action after making a number of extortion-like threats to expose the company to a threatened avalanche of litigation and negative publicity.'"
Irene Morales, 20, filed the suit on Friday for $250 million in Brooklyn Supreme court. She started working at the Chelsea store when she was 17 and Charney began harassing her from the get-go, the lawsuit claims, asking for explicit pictures among other things and continuously telling her that she would have to have sex with him once she turned 18. The New York Post adds, "the pressure of Charney's demands caused Morales to become 'increasingly nervous and depressed,' forcing a hospital stay after an 'emotional breakdown.'"
Then, on her birthday in April 2008, the Daily News writes:
Charney invited her to his Manhattan pad, opened the door wearing only his briefs and "forced her to go down on her knees just inside the front door and perform fellatio upon him."
He then threw her on the bed and made her repeat the same sex act, "nearly suffocating her in the process," the suit says.
"She was then, to all intents and purposes, held prisoner in the apartment for several hours and forced to perform additional sexual acts," the suit says.
Morales ultimately quit her job. She said she didn't go to the police sooner because she was ashamed, but is now considering pressing criminal charges.
This isn't the first time a former employee has floated such charges against Charney -- the man who loves a good clothing ad in which models wear little clothes -- but none have ever made it to a courtroom.
American Apparel issued the following statement (via Racked):
We have been informed today that [Morales], a former employee of American Apparel who left the company without complaint and resigned with a letter of gratitude regarding her positive experience at the company, has filed a sexual harassment lawsuit in New York against the company.
Upon her resignation, [Morales] acknowledged in writing that she had no pending claims against the company and signed a severance agreement which included a full release of claims and an agreement to submit any future claims to confidential binding arbitration. All American Apparel's employees are subject to the same confidential arbitration agreement signed by [Morales] in order to protect the privacy interests of employees and former employees, and to prevent predatory plaintiffs and their attorneys from attempting to use the media to extort the company. Such an arbitration process was initiated by the company against [Morales] several weeks ago.
The company intends to file a formal complaint with the NY state bar seeking disciplinary action against [Morales'] lawyers who we believe are engaged in an illegal conspiracy to extort money from American Apparel. We are very confident that [Morales'] claims will be promptly referred by the court to confidential binding arbitration where her claims and the company's counter-claims will be resolved, we believe fully in favor of the company.