Another former American Apparel employee filed a wrongful termination lawsuit against the company Monday.
Among several allegations in the suit is that the Los Angeles apparel manufacturer-retailer knowingly broke European labor and wage laws, and fired the employee for complaining about it.
The suit on behalf of Bernhard-Axel Ingo Brake, filed in Los Angeles County Superior Court, is the second filed against American Apparel and Chief Executive Dov Charney that alleged financial misconduct by the company.
Company spokesman Ryan Holiday said the company has a lawsuit pending against Brink in German courts and that Brake’s attorney, Keith Fink, is using the case to drum up media attention and pressure the company to settle other cases he has pending against the company.
“This suit is nothing more than another baseless retaliatory lawsuit filed by Keith Fink on behalf of someone who American Apparel fired and sued in Germany in October 2008 for embezzlement,” Holiday said.
Brake said in the lawsuit he was hired by Charney in 2002 and was sent to Europe the following year to build the company’s wholesale operations and help establish retail stores there. Brake claims that while he received regular raises from the company, he never received bonuses and stock Charney promised him.
Brake, who was fired in September, said he repeatedly warned Charney that French law prohibits compensating employees in a way that would deliberately lower the company’s tax burden. That included compensating employees in cash and in American Apparel clothing, and masking some compensation as reimbursement for expenses.
Brake’s suit also alleges female managers eventually put in charge of many of the stores received favoritism from the company because of alleged personal relationships with Charney.
Brake said in his lawsuit that matters came to head in Sept. 24 when the company’s general counsel traveled to American Apparel’s European subsidiary office in Germany, accused him of financial misconduct instead, and fired him.
Fink is representing another former male employee of the company’s L.A. accounting office who sued last month, claiming Charney attempted to pressure him in 2006 to inflate figures on the company’s balance sheet as the company was working to attract investors. Fink also has represented three female employees who have made wrongful termination and sexual harassment charges against Charney.
American Apparel has described allegations in the earlier suits as fictional and claims Fink has a vendetta against the company and Charney.
Fink denied that charge, adding that he has never approached the company prior to filing a suit and offered to settle. “I fully expect all these cases to go to trial,” he said. “The whole extortion argument makes no sense. Why don’t they address the facts in the case?”
