On Nov. 13, 2008 American Apparel defended itself against an ex-employee's wrongful termination lawsuit -- the latest legal trouble for the seller of all manner of cotton clothes. Roberto Hernandez sued American Apparel Inc. and its chief executive, Dov Charney, in Los Angeles County Superior Court last week. The lawsuit claims he was fired a week after he refused to pad the company's balance sheet to make the company more attractive to potential investors. Hernandez's lawyers said he worked in accounts payable and the IT department. The company disputed that he was an accountant, among other things. On Nov. 12, the company reported that its third-quarter profit fell 61 percent as it spent $13.2 million on stock-based compensation, but the clothing manufacturer still reaffirmed its full-year profit estimate. Revenue rose 45 percent and sales in stores open at least one year, a key retail metric known as same-store sales, rose 24 percent. Shares fell $2.18, or 35.2 percent, to $4.02 in Nov. 13 trading.

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