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American Apparel might have to file for bankruptcy if 2011 doesn't turn out better than 2010. According to the LA Times, the company reported a net loss of $86.3 million last year, with sales down 4.6% from the previous year. Also, Lion Capital, a major lender for the debt-plagued brand, has left the board of directors. And then there are those sexual harassment lawsuits, which just get messier and messier.
In an interview with the Times yesterday, CEO Dov Charney played down the problems, blaming American Apparel's money issues on last year's major immigration raid, which forced the company to layoff unauthorized workers and resulted in lower productivity. He also said that Lion left "so they can be a better financial partner with us." And the brand's annual report noted that it didn't expect the lawsuits to have much impact on its business.
Which makes us wonder: Are you still shopping at American Apparel? Because if you are, they're having a giant online sale right now. Merchandise is 20% to 90% off, and if you spend a minimum of $10 online, you can use the code APRIL1ST at checkout to get up to five free items. Suspicious? We were too, but Racked National got their AA contact to swear this is not an April Fool's Day joke.
· American Apparel reports loss, sales decline for 2010 [LA Times]
· Images of Dov Charney's Accuser From Sexy Photo Shoot Surface [The Cut]
· American Apparel is Giving Away Free Stuff Online (Not a Hoax) [Racked National]