Transcript for American Apparel Ousts Founder Due to His Personal Conduct
Thursday June 19 New York markets are open for business in today's big number is one dollar -- about. Stock in American Apparel will set you back today as the board made a shocking movement has rattled the company. And its investors to its core hello everyone I'm Michelle Franzen in New York -- explain what is going on at the onetime red hot retail store -- Lester Yahoo! finance. All right Lauren get us up to speed here really quickly what happened with the board and the founder. Yeah well as one dollar is -- -- this stock is trading at 64 cents. I share its vision come down 80% in the last five years and the new news -- aids really. You know quite -- shock. Is it the board has voted to oust this CEO and chairman and he's the founder of the company he's very much that -- that company and -- voted unanimously cue -- spirit about it. And of course -- appears to be a combination of perhaps -- Charny is controversial behavior but also the company is just not doing well when it comes to its own product correct. Gas and here's the thing at this guy bent -- Charny he has been based. Allegation. Of misconduct and lawsuits for years allegations that inappropriate behavior. -- -- -- And this was the grounds upon which he has been voted to be remitted the board's -- chairman -- newly appointed co chairman. Told the Los Angeles Times that. This was the -- recent -- yes the company has -- performance issues but that it had nothing to do with the company's operations. And was based on new information that came to light surrounding these allegations that the board that investigated. And those of the grounds upon which they had dismissed him so it's really focused on. His personal contact and allegations that he has -- -- conduct with women and -- support judgment. Is well. And and that's why they're getting rid of them at this point and of course de -- is definitely outspoken on all of this all along the way any -- reaction from Sharif since. The board has made his decision. Well that co chairman of the board the same one day he said that he thinks that they -- -- fight tooth and nail against this he had thirty gates to -- -- because it's something. In his contract clause in his contract so expected by eight this was a surprise to him according to the report so. I it looks like this is something he's gonna try and fight back at you mention it's not like the company is doing well the company has struggled -- dat. -- accident try to figure out a way to get more cash in order to pay debt. Really poor earnings Lott says. Struggling to lift sales so that that probably the company are broader based and clearly this CEO had become a liability you. Well and a statement of. Board said it takes no joy in this action of course -- -- created American Apparel the company has grown much larger than any one individual and we are confident that its greatest days. Are still ahead that you mentioned. Dollar of stock and that was -- yeah generous as that investors see this as a bargain though it is -- just the way or ordered. -- Wilson they aren't is mourning the stock was at that point 6% premarket heading into the open it's probably -- -- similarly now. That the market is up and it making it a whopping eighty cents a share. Look this company's taken a beating over five years and -- according to -- -- -- the folks around my office are saying that the list. This morning as likely because they think that they're trying to that sell. And and -- are looking to push forward with that in some meaning that the opportunity investors are getting. A little excited about this morning you have to of course but it respective business still is and eighty cent a share stock. But yeah timing in a sore spots this morning has been positive to the news. Very good Lauren -- from Yahoo! finance thanks for joining us we will keep watch on this story you are they -- keep up with the latest headlines. Right here on abcnews.com. You've been watching -- big number I'm Michelle Franzen in the Iraq.
This transcript has been automatically generated and may not be 100% accurate.