Brooklyn Judge Issues a Stay in American Apparel Sexual Harassment Lawsuit

According to The Los Angeles Times, a Brooklyn judge has issued a stay in the sexual harassment lawsuit against the chief executive of American Apparel Inc. Irene Morales, a former AA employee, failed a lawsuit against the company and Dov Charney alleging that her former boss forced her to perform oral sex in his New York apartment. Morales was 18-years-old at the time of the alleged incident.

Morales further claimed that Charney sexually harassed her for months, demanded that she send him explicit photographs, e-mails and text messages. Morales described her boss’ actions as “extreme psychological abuse and torment” from the time she started working as a shop assistant to the time she was moved up to a management position of one of American Apparel’s branches.

Morales filed in the Brooklyn supreme court claiming $260 million in damages. American Apparel said that the company would take legal action against the former employee for breaching a severance agreement she signed at the time of leaving. Upon her resignation, Morales acknowledged that she had no pending claims against the company and signed a an agreement to submit any future claims to confidential binding arbitration.

A Brooklyn judge ruled in response to a motion filed by the company that contended the issues raised by Morales should be settled in confidential arbitration, per the signed agreement. The defendants claimed Morales brought the lawsuit failed several extortion-like threats to expose the company and negative publicity.