Former CEO Dov Charney fired 'for cause' from American Apparel

Dov Charney
Keith Bedford | Bloomberg | Getty Images

American Apparel fired former CEO Dov Charney after an internal investigation concluded that he violated the terms of his employment agreement. He will be replaced by Paula Schneider, effective Jan. 5.

Charney was suspended as president and CEO in June for alleged misconduct and violations of company policy, American Apparel said in a statement.

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"We're pleased that what we set out to do last spring—namely, to ensure that American Apparel had the right leadership—has been accomplished," said Allan Mayer, board co‐chairman, in a statement.

Schneider, formally of Warnaco and BCBG Max Azria, has a "reputation for improving the financial performance and operational efficiencies of numerous global fashion brands," according to the statement.

The stock soared as much as 7 percent in after-hours trading.