American Apparel filed for bankruptcy protection early Monday, The Wall Street Journal reports. The Los Angeles-based retail chain has struggled with a drop in sales and legal battles with its ousted founder, Dov Charney, who left the company in December. The Chapter 11 petition was approved by the company’s board and filed in a federal bankruptcy court in Delaware. Creditors have allegedly agreed to give additional funds to the company’s operations in bankruptcy and finance its exit from Chapter 11, the Journal reports. American Apparel plans to restructure its debt and shutter stores, but no layoffs were announced in the filing.
I think it can be hard to run a business and also court battles can use money and that actually costs too much for the person in the end or business, and it ends in bankruptcy which can be bad in society since the name is ruined. I reckon that when you have creditors then they may or may not choose to help out the company, and this one is lucky there is some help to cover the operations in their life. It is interesting to see what occurs when people leave the company and the remaining people, have to deal with the mess and try and pay the debts or expenses incurred as a result.
