American Apparel CEO Uses Secret Contracts to Silence Models Who Pose Nude for Him

American Apparel (APP) CEO Dov Charney uses a lengthy, restrictive contract to silence the young models who frequently pose nude for him, according to copies obtained by BNET. The agreements ban models from suing him in court, prohibit them from saying anything bad about American Apparel to the media, and force models to take their disputes to secret, binding arbitration from which there is almost no appeal.

Charney's restrictive contracts lie at the heart of a recent lawsuit in which he was accused of unfairly preventing a model from bringing a lawsuit against him. Charney conducts his own photoshoots for his advertising, the American Apparel web site, and his various promotional and merchandising collateral material.

The model, Tesa Lubens-Dehaven, did not say in the suit why she wants to leave arbitration and go into public court against Charney. Her co-plaintiff, former store clerk Kimbra Lo, claims Charney suggested Lo become one of his models before attempting to have sex with her. AA and Charney deny the claims, saying his accusers sent him sexy photos and emails.

Lubens-Dehaven is almost certainly the "Tesa" depicted in the model index on AA's web site, and in these images (at right).

The contracts are unusually long -- and unusually onerous -- considering the models are paid $50 an hour, according to the agreement, and often only get $300 a session. Here is an example of a standard model contract -- its main purpose to assign rights to the photos to the photographer and not the model. But American Apparel's "Model Release and Arbitration Agreement" is much, much longer.
It begins by warning the girl she will not get paid unless she signs the agreement:

It then bans the woman from suing Charney in court:

It insists that the arbitration be conducted in complete secrecy:

And it especially warns models not to go public with any negative information about the clothing chain, "or online on blogs":

Tesa's contract also contains a handwritten note to "Kyung," which is the name of another model who posed nude for Charney. She should make an interesting witness if the case ever comes to trial.

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• How a Sex Harassment Case Against American Apparel Could Lead to CEO's Fall