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American Apparel CEO To Step Down
American Apparel's L.A. headquarters. (Photo by Doran via the LAist Featured Photos pool on Flickr)
Paula Schneider, chief executive officer of American Apparel, will resign from her post on October 3, reports Women's Wear Daily. She is expected to be replaced by Chelsea Grayson, the company's general counsel and chief administrative officer.
The news comes as the clothing company faces a period of upheaval. Paul R. Charron, who headed the company's board, had recently left the company. And, back in August, sources told Reuters that the company had hired Houlihan Lokey—a bank—to help it explore a sale. A couple days before that, The New York Post said that the company was looking to move its L.A. headquarters to another city, possibly to avoid the minimum wage hike.
WWD notes that it seems like Schneider is stepping down voluntarily, but also says that the (possible) sale of the company had perhaps steered her decision to leave. "[The] sale process currently underway for all or part of the company may not enable us to pursue the course of action necessary for the plan to succeed nor allow the brand to stay true to its ideals," Schneider said in her resignation letter, which WWD had obtained. "I've come to the conclusion it is time for me to resign as CEO."
Schneider joined the company in late 2014 and became the chief executive on Jan. 15, 2015, replacing embattled founder Dov Charney, according to California Apparel News. She was at the helm when the company laid off hundreds of employees in April. She'd said that the layoffs resulted from a "redesign of our production process," and hinted that some of the manufacturing could be outsourced to third-party companies.
"They are doing exactly what American Apparel fought against," said Charney, according to the Times. He maintained that he'd always resisted "outsourcing and searching for ways to pay people less money."
American Apparel has a pretty hefty list of troubles. Aside from the items listed above, the company had filed for bankruptcy in 2015, and, oh yeah, there was all the matter pertaining to founder Charney, who was permanently banished from the company earlier this year. He'd attempted to regain control of his company after he was ousted. And he'd been accused of unscrupulous behavior (to put it lightly) directed at employees.
A spokesperson for American Apparel declined to comment for this story.
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