American Apparel Urges Dismissal Of Fraud Class Suit

Law360, New York (June 1, 2011, 2:35 PM EDT) -- American Apparel Inc. on Tuesday urged a California federal judge to toss a consolidated fraud class action claiming the slumping clothing retailer duped investors about the legality of its workers and bookkeeping.

The putative class action, lacking facts, invents a scheme whereby American Apparel hired thousands of illegal immigrants and inflated its stock by misrepresenting the resulting liabilities, indulging in pleadings that fall well short of the stringent standards under the Private Securities Litigation Reform Act, according to American Apparel.

The consolidated class action complaint, filed...
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