PRLog - Aug. 19, 2010 - SAN DIEGO -- An investor in American Apparel Inc. (AMEX:APP) filed a lawsuit alleging breaches of fiduciary duty by members of the American Apparel board of directors.
If you are a current long term investor in common stock of American Apparel Inc. (AMEX:APP), including those who purchased APP stock prior to January 2008 and continue to hold those shares, you have certain options and you should contact the Shareholders Foundation, Inc by email email@example.com or call +1(858) 779 – 1554.
American Apparel, Inc., located in Los Angeles, California, is a vertically-integrated manufacturer, distributor and retailer of branded fashion basic apparel. According to the complaint the plaintiff alleges that American Apparel’s founder and CEO Dov Charney and along with its board of directors misled investors, mismanaged the company and "irreparably damaged" its image.
On March 31, 2010, American Apparel, Inc. disclosed an audit report issued by Deloitte & Touche, LLP. According to the investigation the report identified material weaknesses in American Apparel's internal controls over financial reporting and their financial closing and reporting processes.
Then on July 22, 2010, Deloitte resigned as the independent registered public accounting firm of American Apparel, having serves as the Company’s independent registered public accounting firm since April 3, 2009. On July 26, 2010, the Audit Committee had engaged Marcum LLP as the Company’s independent auditors to audit the Company’s financial statements.
On July 29, 2010, after Deloitte's resignation was announced to the public, American Apparel shares dropped from $1.81 per share to close at $1.55 per share. American Apparel Inc. (APP) paid in 2007 twice dividends of 75Cents per share and rose from $9.18 per share in January 2007 to over $15 per share in December 2007. During 2008 APP shares lost over 80% of its value and traded as low as $1.82 per share in December 08. During 2009 APP shares recovered and traded as high as $6.60 per share in May 2009, but lost again substantially value and traded recently at $1.44 per share, even below its low from December 2008. American Apparel’s Total Revenue more than doubled within in the past four years from $284.97million in 2006 to $558.77million in 2009. While American Apparel Inc. had to report a Net Loss of $1.61million in 2006, it reported a two digit million Net Income in 2007 and 2008, $15.48million, respectively $14.11million. But American Apparel’s Net Income diminished in 2009 to slightly over $1.1million and according to the complaint American Apparel, which has not filed financial statements for the past two fiscal quarters, is "on the verge of being delisted from the New York Stock Exchange."
On August 17, 2010, The New York Times reported that American Apparel received a federal subpoena in New York related to its problems with Deloitte & Touche. American Apparel stock went from $1.40 on Monday August 16, 2010, to roughly $1.10 per share on Tuesday, and declined to as low as $0.73 per share on Wednesday August 18, 2010.
Those who are current long term investors in common stock of American Apparel Inc. (AMEX:APP), including those who purchased APP stock prior to January 2008 and continue to hold those shares, you have certain options and you should contact the Shareholders Foundation, Inc by email firstname.lastname@example.org or call +1(858) 779 – 1554.
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The Shareholders Foundation, Inc. is an investor advocacy group. We do research related to shareholder issues and inform investors of securities class actions, settlements, judgments, and other legal related news to the stock/financial market. At Shareholders Foundation, Inc. we are in contact with a large number of shareholders. We believe that together we can combine the interests of many investors, and use the size of our interest as leverage against the giant corporations. We offer help, support, and assistance for every shareholder. We help investors find answers to their questions and equitable solutions to their problems. The Shareholders Foundation, Inc. is not a law firm. The information is provided as a public service. It is not intended as legal advice and should not be relied upon.