In a Delaware court, American Apparel filed for bankruptcy protection today for the second time in 13 months. When founder and CEO Dov Charney was ousted from the company after a series of scandals, American Apparel hired fashion veteran Paula Schneider to lead it in a new direction. But she left in September saying the company was in talks to sell itself, which would hamper her turnaround efforts. In the meantime, sales are continuing to plummet.
American Apparel will now hold an auction for its assets. Canadian company Gildan Activewear, which purchased the brand's intellectual property rights for $66 million, has asked for the opportunity to maintain American Apparel's operations in Los Angeles, according to a letter to employees.
American Apparel is still looking for a potential buyer and started discussions for a possible sale with brand licensor Sequential Brands Group and financial services company B. Riley Financial.
Read more at Reuters.