Skip navigation
MOST POPULAR RELATED TAGS
  • TOPICS
  • SECTORS
  • COMPANIES


Current DateTime: 05:48:54 22 Nov 2009
LinksList Documentid: 23279679
Expiration DateTime: 11/22/2009 5:51:39 AM

Current DateTime: 05:48:55 22 Nov 2009
LinksList Documentid: 24355697
  • Runway Angels

      The superbowl of fashion shows, models walk down the runway at the 2009 Victoria's Secret Fashion Show.

  • The Richest Members of the US Congress

      Recently, the Center for Responsive Politics found that there are 237 millionaires in the US Congress.

  • 10 Tips to Get Out of Debt

      Renowned financial author Gail Vaz-Oxlade takes a tough-love approach to helping couples in a financial crisis to face reality.

powered by digg

ABOUT THIS BLOG

Get RSS Feed

It's a make-it or break it time for retailers. The holiday selling season is always a critical time for retailers, but this year this may be even more true. With several retailers already falling victim to a drop in consumer spending, and filing for bankruptcy, retailers will be navigating through some tricky waters. Consumers are strapped for cash due to high energy and food prices, and unemployment is rising. The recent credit crunch has made it more challenging for retailers and consumers to borrow.

This blog will look at the winners and losers in the retail space. Who has the right strategy to capture consumer dollars? It also will look for trends in consumer spending and how that will impact the economy.
 
Text Size
Feb.19
8:24 AM ET
Tuesday, 19 Feb 2008
American Apparel CEO Trial Starts Today

Now that American Apparel CEO Dov Charney's sexual harassment and wrongful termination lawsuit is headed to trial, will there be changes in the boardroom or behavior in how day-to-day management of American Apparel is handled?

On Friday, Los Angeles Supreme Court Judge John Shook declared that attempts to arbitrate the case brought against Charney by former employee Mary Nelson have fallen apart. The trial is set to begin today (Tuesday, Feb. 19).

In an interesting twist, hedge fund king Stevie Cohen upped his stake in American Apparel [APP  Loading...      ()   ] (trades on the AMEX under ticker APP) to 5.5 percent from 4 percent. (His affiliates S.A.C. Capital Management and CR Intrinsic Investors own 3.14 million shares.)

While Cohen reported the stake today as a passive investor, it will be interesting to see if/how his growing ownership influences management.

Last month, Charney told me that the sexual harassment suit against him would have no impact on the business and that they didn't intend to make any changes to its sexually-charged advertising campaigns. Now that APP is a publicly traded company, I can't help but think that there will be some impact on business.

While accusations against Charney have been well-publicized (and, to be fair, none of the previous three harassment cases against him have made it to trial), the bad press hasn't seemed to hurt business. Any press is good press, I guess when it comes to building an "edgy" image.

But here's where it may impact American Apparel: A trial that involves the personal behavior of a CEO undoubtedly costs that executive time, energy, focus and, certainly, some employee confidence.

Clearly American Apparel's core clothing business and edgy advertising campaigns (those linked with social issues like immigration) make it a very interesting business story. If the company wants the media and investors to stay focused on their core competencies and growth story though, they need to make sure that this case and their CEO's alleged misbehavior doesn't hijack their success.

Questions? Comments?

© 2009 CNBC, Inc. All Rights Reserved

Tools:
PrintEmailAdd This share icon
Next Post
  • digg share

CNBC HIGHLIGHTS

  • Technology can make or break a fortune in the world of alternative energy.
  • Many people are facing the holidays with substantially smaller incomes. Here’s how some are adapting.
  • Jim Cramer
  • Jim Cramer is a proponent of stocks that pay healthy dividends, and here are his top five dividend plays.
  • From salt, to lip balm to envelopes, it turns out that bacon flavoring can sell almost anything.
  • real estate signs
  • The homebuyer's tax credit jacked sales for a while, but 2010 is looking weak. Now what?
  • CNBC’s technology reporter Jim Goldman guides you through the best gadgets to buy this holiday season.
ADD COMMENTS
Remaining characters


Current DateTime: 02:35:20 22 Nov 2009
LinksList Documentid: 29778428

Current DateTime: 02:42:00 22 Nov 2009
LinksList Documentid: 29779196

Current DateTime: 02:35:20 22 Nov 2009
LinksList Documentid: 29779199

Current DateTime: 02:35:20 22 Nov 2009
LinksList Documentid: 29779198
  Data is a real-time snapshot  *Data is delayed at least 15 minutes
Global Business and Financial News, Stock Quotes, and Market Data and Analysis

© 2009 CNBC, Inc.  All Rights Reserved.
A Division of NBC Universal
Thomson ReutersThomson Reuters