Dov Charney took the stand yesterday in perhaps his final chance to win back control of the company he founded.
During two hours of testimony yesterday during the bankruptcy case of Top 40 supplier American Apparel (asi/35297), Charney recalled how he started the company and accused board members and lenders of “a plan behind the scenes to steal the company from me,” Charney said. “Since then, it’s been a constant hide-the-ball.”
The former American Apparel CEO took the stand to convince the judge in the case that Charney’s recent $300 million offer, backed by private equity firms, is superior to American Apparel’s current bankruptcy exit strategy. The company turned down the offer last week, which Charney attributes to American Apparel’s unwillingness to see him return to the company he was fired from in December of 2014. “There's no chance I can ever have a fair shot,” Charney said, according to the Los Angeles Times.
American Apparel’s lawyers declined to cross-examine Charney, saying that while they disagreed with almost all of what he said, they felt his testimony wasn’t relevant to the company’s plan to exit bankruptcy, according to the New York Times.
Judge Brendan Shannon is expected to make a decision on Monday morning. The judge will decide whether to approve American Apparel’s lender-backed restructuring proposal while considering the offer from Charney and both Hagan Capital Group and Silver Creek Capital Partners. If Shannon considers Charney’s bid viable, he could perhaps give more time for the investor group to improve its bid.