How does the founder of one of the most successful clothing stores in American history find himself ousted and disgraced? He’s Dov Charney, that’s how.

Dov Charney’s American Apparel clothing stores and provocative ads changed so much about fashion in recent years. While other brands focused on building their brand logos, he made simple sexy. American Apparel tee shirts, leggings and clean, straightforward designs that never bore a logo or branding—all made in downtown Los Angeles—became synonymous with today’s fashion. The American Apparel empire grew to nearly 250 stores and more than 10,000 employees since Charney started up the operation in 1991. By 2007, sales were up to $387 million.

The iconic ads—beautiful women in sexy poses—grace magazines and billboards across the country. (A former roommate of mine once told me he planned to sue American Apparel if he ever got into a car accident that was his fault; chances were he was distracted by one of the billboards, he said.)

Charney, 45, has been the target of numerous sexual harassment allegations and lawsuits over the years. According to the Wall Street Journal, “As the sexual- harassment suits proliferated—the company lists five arbitration cases in a recent filing—American Apparel’s deductible for liability insurance soared to $1 million a year from $350,000.”

On June 18^th, the American Apparel board terminated Charney, removing him from his board chairmanship and CEO position, citing “willful misconduct” that included allegations of posting naked pictures of a former employee who had filed a sexual harassment suit against Charney on a blog site he approved. The employee claims that he made her his sex slave.

A day after he was fired, this unbelievably disturbing video surfaced. Yes, that’s Charney dancing naked in front of his employees. The woman filming the video encourages Charney, “Shake you booty!” she says. He looks away, saying, “Stop. You’re gonna get me in trouble.” A former American Apparel model told Gawker “That is 100% [Charney].”

Charney rebuffs the board’s decision and intends to fight the accusations, reports the New Yorker. “He is American Apparel’s largest shareholder, owning more than a quarter of its stock. His attorney, Patricia Glaser, in a letter to the board, calls the firing ‘not merely unconscionable but illegal,’ arguing that Charney had no opportunity to negotiate.” Glaser contends that the allegations are baseless. “Most involve activities that occurred long ago (if at all) and about which the Board and the Company have had knowledge for years.”

The issues with Charney aren’t limited to his sexual misconduct, either. Poor business decisions quickly became costly. Loans from Lion Capital quickly grew out of control incurring penalties for going unpaid and high interest rates. The $80 million loan grew to nearly $150 million before it was repaid in 2013. That same year, the company reported more than $100 million in losses.

The brand’s prideful “Made in Downtown LA” claim took a hit in 2009 when an investigation found that more than half of the factory’s employees weren’t authorized to work in the U.S.

Charney’s been compared to Terry Richardson, the fashion photographer who has also faced sexual misconduct allegations recently. Jezebel asked in this witty headline: “Are Dov Charney and Terry Richardson the Same Person? Almost!” While they’re not, technically, anyway, they both do represent a kind of person, one Jezebel outlines in a scary/hilarious/scary-again chart. It’s pretty outrageous.

But here’s the question, or the caveat emptor: Is it worth it? Is the world a better place because of Charney’s American Apparel contribution (or Richardson’s photos)? Is his behavior the price we pay for entrepreneurism, or art, for that matter? Historically, some of our most beloved artists were also known for their mental health issues, from Van Gogh to Cobain. But when the line is crossed and the brilliant/disturbed artist becomes a sexual abuser, what do we do next? In this case, do we trash all of our American Apparel clothing? Or do we wear them in solidarity with Charney’s victims who paid for these clothes in unthinkable ways?

Find Jill on Twitter @jillettinger

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Image: infomatique

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