The new American Apparel Inc. is starting to look more like the old one.
This story first appeared in the October 22, 2014 issue of WWD. Subscribe Today.
Sources said the company has rehired Iris Alonzo as senior creative director with a mission to protect and evolve the brand and help restore some normalcy to a difficult situation.
American Apparel fired Alonzo shortly after founder Dov Charney was ousted as chief executive officer in June.
One source close to the company cautioned that: “Charney has had no impact one way or the other on any personnel decisions being made. [Interim ceo] Scott Brubaker is the one ultimately making those decisions, not Dov.”
That is no doubt technically true. But even so, some American Apparel watchers — and there are still plenty of people interested in the highest-profile domestic apparel producer — saw the appointment as a measure of Charney’s influence.
Alonzo has been a big supporter of Charney. She told the Los Angeles Times this summer that, “If he were to not be put back into a leadership position, the steam would soon dissipate.”
One source said Brubaker is in touch with Charney and has been getting his recommendations, but that Charney doesn’t have free reign at the company he founded.
The famously libertine Charney has proven to be remarkably resilient.
American Apparel’s previous board sidelined him as ceo and signaled its intent to fire him for cause after allegations of misconduct. But he rebounded strongly, finding an investment partner in Standard General, and succeeded in reworking the board.
Charney is now back as a consultant although one source stressed he’s invited to participate in the business at Brubaker’s discretion.
He has no supervisory role, but continues to speak on the company’s weekly conference call with store managers, another source said.
“Dov is fighting hard to regain the ceo job,” said the source. “Dov is being very difficult in terms of accepting anything less than the ceo position.”
The suitability committee of the board is still considering Charney’s future at the company — and the process has stretched out much longer than expected and could last several more weeks.
It’s a sticky situation for American Apparel. If the company isn’t able to negotiate a way for him to stay, it faces either a hefty severance payment or an expensive legal battle.