The Dark Side of the American Apparel Cult

MsMojo

The rise and fall of a fashion empire built on disturbing foundations... Join us as we explore the shocking truth behind American Apparel's toxic workplace culture, founder Dov Charney's controversial leadership, and the cult-like practices that destroyed the company from within.

Transcript

00:00That's like the cult leader 101. You just keep them a little bit hungry and then you're the one

00:05that's only really feeding them what they need. Welcome to Ms. Mojo. And today we're taking a

00:10closer look at the clothing retailer American Apparel, its meteoric rise and dramatic fall,

00:17the controversy surrounding its founder and the disturbing accounts from former employees.

00:23Yes, there was abuse, there was also fun times and that's why it's so layered.

00:30Background of the company. American Apparel may have seemed like it popped out of nowhere in the

00:36early 2000s. In reality, however, the brand's origins go back to the late 1980s when founder

00:43Dove Charney began selling t-shirts under that name while schooling at Tufts University.

00:49Charney dropped out of college and in 1991 started manufacturing t-shirts. Soon he would begin making

00:55shirts with a tighter cut and better fit than the standard oversized tee. Over the next decade,

01:01Charney grew the brand mostly on his own, targeting young, trendy adults and promoting it with the

01:06slogan, ethically made, sweatshop free. This meant the clothes were manufactured in the U.S. by adult

01:12factory workers who earned well above minimum wage and worked under favorable conditions.

01:18American Apparel was seen as an anomaly in an industry known for dangerous working conditions

01:22at extremely low pay. American Apparel paid its workers high wages by industry standards

01:28and provided benefits including health care and education resources to workers.

01:32On paper, this sounded great and it gave the brand a progressive and appealing image that

01:38resonated with many young consumers. But as it turns out, the reality might not have been quite so

01:44picture perfect. He was selling this made in America sweatshop free thing and I thought it was

01:50great. Like there was more to it than just being cool. It was also like meaningful.

01:56Dove Charney. As an entrepreneur, Dove Charney was dogged and keen-eyed, overseeing the operations

02:03of his company like a hawk. I run American Apparel in an instinctive manner, an impulsive manner. I try to

02:10break down all kinds of barriers. Although he headquartered the business in Los Angeles,

02:16the Canadian-born founder made a point of visiting all his stores, even those in South America and

02:22Europe. However, when it came to human resources, Charney operated less like a traditional executive

02:27and more like a cult figure. He seemed to view himself as a savior of American manufacturing,

02:33on a mission to bring back jobs that had been lost to overseas sweatshops and offer workers livable

02:39wages without sacrificing profitability. Charney says he's on a crusade to smash the garment

02:45industry's culture of worker exploitation from within. It was no surprise then that many of his

02:51employees began to idolize him. To them, he was one of the few in the industry who truly prioritized

02:57people over profit. And that ethos was a big thing for me. I was like, there's so much good about this

03:04company. Young, inexperienced corporate employees. I probably wore that one American Apparel shirt that

03:10I shoplifted to the interview. The manager just came out and kind of looked at my outfit, took a photo

03:15of me and was like, you can start Monday if you want. Unlike many young founders who surround themselves

03:21with far more experienced staff, Charney took the opposite approach. Many of his corporate employees

03:27were even younger than he was, often with little to no experience. Charney's hiring decisions focused

03:33more on the applicant's look and attitude than whatever was on their resume. I gave her my resume,

03:39which was basically a blank piece of paper. And she kind of just like tossed it to the side,

03:45looked me up and down. And she was like, so what do you want to do here? As a result, instead of having

03:50more seasoned professionals who could challenge or advise him, Charney built a team of loyal employees

03:56who felt indebted to him for jumpstarting their careers. Their youth made them more malleable,

04:02allowing Charney to shape their image with ease. He also indoctrinated them early on, giving new hires

04:08a welcome package that included a Leica camera, a BlackBerry, a book called The 48 Laws of Power,

04:15and a Vibrator. I kept the BlackBerry, I kept the camera, of course I kept the Vibrator,

04:22and I threw away the 48 Laws of Power. I just cared about sex, drugs, and t-shirts.

04:29Attractive pay, long work hours. Although Charney provided excellent labor conditions for his factory

04:35workers, the same care didn't seem to extend to his corporate employees. Their attractive salaries

04:41and rapid promotions came at a hefty price. Personal freedom. He wouldn't even take breaks to eat food,

04:48he would send out his number, just be like, call me whatever, like call me day night. And he expected

04:54the same of his employees. Staff at American Apparel were often forced to work grueling hours,

05:01sometimes for several days on end. One former employee interviewed in the Netflix documentary,

05:06Trainwreck, the cult of American Apparel, recalled working such long shifts that the payroll staff

05:12didn't believe he was clocked in the entire time. On top of the 80 hours that I worked, it was like

05:18120-something hours of overtime that I clocked. I did a 36-hour shift that payroll didn't believe me.

05:27They had to check the cameras to see that I was there. Charney also reportedly rented company

05:32apartments where employees lived together, further blurring the line between work and personal life.

05:38This setup of drawing staff into a tightly controlled environment and isolating them

05:42from outside connections was one of many practices that gave the company a concerning atmosphere.

05:48It will yell at you, call your names, humiliate you until you feel down, broken.

05:55Cult-like practices and questionable leadership. Charney's efforts to control and unify his staff's

06:02image went far beyond those in his immediate environment. Every Wednesday, he held a global

06:08conference calls with representatives from every American Apparel store around the world.

06:14Sometimes you would dial in the line and it would say there were too many participants,

06:17but it was like, how is that possible? But it was just hundreds and hundreds of people.

06:23During these meetings, he would reportedly dictate how employees should dress,

06:28style their hair and wear makeup. He also had a practice of publicly ridiculing one person each

06:33week, labeling them the, quote, fool of the week. Like, oh my God. I mean, it was so mortifying that

06:41hundreds and hundreds of people heard that you personally are the fool of the week for a

06:46multi-million dollar company. It was clear Charney was one of those founders who treated his employees

06:51like, quote, family, considering how much company business he conducted in his own home.

06:57Some employees even lived there full-time, including Johnny Makeup, who appears in the

07:02Netflix documentary. He described the house as a, quote, playboy mansion for hipsters due to the

07:08endless parade of young women drifting through it. I guess it was like the playboy mansion, but for

07:13hipsters. It was unclear, like, what sort of relationship some of the girls had with Dove.

07:22Sexually charged nature of the office. Over time, Charney's behavior became increasingly disturbing

07:28and sexually inappropriate. He would reportedly walk around the office in his underwear and was once

07:35filmed naked in a room with two female employees present. That video went viral because people are

07:41probably asking, who does this? I have my own lifestyle. You know, we're taught in school. Don't

07:46judge people's personal lifestyle. Charney also employed a group of young, attractive women

07:52referred to in the office as Dove's girls. He allegedly slept with them and later elevated them

07:58to positions of authority, encouraging them to intimidate other employees into doing his bidding.

08:04At my desk, there'd be some girl that would show up with a micro-mess shirt and nothing underneath

08:09and tell me something that I needed to do. And it would sort of be like, excuse me, who are you?

08:15Like, it's like, well, Dove says you have to do this. Charney was also said to have masturbated at

08:20work and even once received oral sex from an employee during a media interview. This hyper-sexualized

08:26behavior soon spread throughout the company, with staff engaging in sex openly at work.

08:32Everyone was sleeping together and you would see like some of the employees

08:36like hooking up in the stairwells. We were young and horny and it definitely felt like

08:43there was a free sex vibe. It reportedly also became normal for employees at American Apparel

08:49to sleep with their supervisors in exchange for promotions, controversial commercials and celebrity

08:56clientele. I just love also that it put a name to the person. Like, it gives a bio of the person.

09:03Yes, some of it was very suggestive, but it was a brilliant idea.

09:09The overly sexual vibe at the American Apparel office seemed to bleed into its advertising.

09:14The company routinely came under fire for its provocative campaigns,

09:18which featured models in various stages of nudity striking suggestive poses. At times,

09:24these models were styled to look underage, which resulted in at least one ad getting banned in the UK.

09:30You were shooting models who were too young, who were made to look younger and exploiting their

09:38sexuality. I don't see it like that. But in this case, the bad publicity only served to amplify the

09:44brand's visibility. Young people were enticed by the provocative ads, which sometimes featured adult

09:50entertainers, and were pulled in further to patronize the brand. The company's appeal was

09:55boosted even more by their long list of celebrity clients, including names like Britney Spears,

10:01Rihanna, and Beyonce.

10:02And, oh my God, Beyonce used to come late at night. We would close the store down for her.

10:10It was amazing.

10:12The Great Recession and Financial Ruin. Throughout the early to mid-2000s,

10:17American Apparel expanded rapidly, outpacing many of its retail competitors thanks to its

10:22incredible sales numbers. A lot of really well-known retailers were doing badly,

10:29but American Apparel continued to expand. However, when the Great Recession hit in the

10:34late 2000s, consumer spending declined sharply, and the brand felt the impact almost immediately.

10:41This problem was compounded by Charney's labor practices. But in 2009, the company faced a huge

10:47blow to its productivity when a federal investigation found irregularities in some employees' identification

10:53paperwork. An immigrant himself, Charney employed many undocumented immigrants as factory workers

11:00and consistently advocated for immigration reform. These efforts drew the attention of ICE,

11:06who raided the American Apparel factory in 2009. As a result, Charney was forced to fire nearly 2,000

11:13undocumented workers. The ICE raid was a huge financial burden because in a period of big growth

11:19for the company, he was forced to let those people go and then rebuild a workforce.

11:27The resulting drop in production, combined with the economic downturn, drove the company deep into

11:33debt. Sexual assault allegations against Dove Charney. Given Dove Charney's track record of alleged

11:41workplace misconduct, the sexual assault accusations that followed were not exactly shocking. The first

11:47wave of lawsuits hit in 2005, when three former employees accused him of sexual harassment in the

11:53office. Charney is currently fighting two sexual harassment lawsuits, and over the years, he's faced

11:59several other accusations from young women who work for him, claiming he's created a sexually hostile work

12:06environment. In 2011, five additional ex-employees filed lawsuits alleging even more serious acts of

12:13sexual assault. Charney, of course, denied the allegations. Conveniently for him, his accusers had signed

12:20indemnity agreements when they were hired, prohibiting them from suing him or the company. As a result,

12:27he was shielded from any civil or criminal liability.

12:29What really pisses me off is that he took my voice. I would love to tell you my story. I would

12:36love to tell you the details of what happened to me at that company, but I'm not at liberty to do so.

12:40As the allegations piled up and the controversy refused to die down, the Board of American Apparel

12:46suspended Charney in June 2014 and officially dismissed him as CEO that December. The Times reports

12:53that Charney's firing comes as American Apparel continues to try to lift sales after years of

12:57underperformance and debt. The company warned that Charney's abrupt firing could push the retailer

13:02into bankruptcy.

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13:19The Aftermath

13:20Since his dismissal, Charney has remained active in the fashion industry. After claiming he was, quote,

13:27down to his last $100,000, he attempted to regain control of American Apparel by teaming up with

13:33a hedge fund to buy the company's stock. When that failed, he launched Los Angeles Apparel in 2016,

13:40hoping to replicate the success of American Apparel using the same strategies.

13:44American Apparel was generating earnings. Unfortunately, he lost control of it. The business

13:50model, though, worked. That's what's so important, is that we were able to pay fair wages and still

13:55generate earnings. In 2020, as the COVID-19 pandemic created a shortage of face masks and medical

14:02gowns, the company began to pivot toward manufacturing medical supplies. However, Charney ignored early

14:08lockdown measures, leading to a COVID-19 outbreak at his factory that resulted in the loss of four

14:14lives. His three plants in South LA on East 59th Street have been shut down after more than 150

14:22workers tested positive for COVID. He later took a job at Kanye West's Yeezy, where he

14:28reportedly printed the controversial White Lives Matter shirts. Following West's anti-Semitic

14:34outbursts online, Charney appeared to distance himself from him. I am a garment man. I know my

14:40business. I'm passionate. My ethics are good. I'm a great industrialist, and I'm a human being.

14:46I have faults. I've made mistakes, but I love what I do. Were you an American Apparel customer?

14:53What do you make of these disturbing revelations? Let us know in the comments.

14:57If American Apparel was successful as an extension of you, what extension of you are we getting now?

15:02We're still getting... The same one! I'm not sorry about sh**.

15:05I'm not a fan of you. The same one! I'm not a fan of you, bro. I'm not a fan of you.

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