Dive Brief:

• American Apparel Tuesday reported heavy Q3 losses, worse than expectations, as it saw its worse sales dive since Q4 2010. 

• The company is still reeling from its ouster of CEO and founder Dov Charney, who has been accused of sexual and financial improprieties. The investigation and ouster of Charney cost $5.3 million in legal fees and other costs last quarter.

• Charney is working as a paid consultant to the company and his future there is still a matter of discussion, sources say.

Dive Insight:

Things seem to be calming down at American Apparel, but the retailer was struggling even before the distracting and expensive drama this past summer. Interim CEO Scott Brubaker put a positive spin on the Q3 results, saying the company did well under the circumstances. 

"I am encouraged by these results," Brubaker said in a statement Monday, saying the retailer showed a 38% improvement, to $13.5 million in adjusted earnings (before interest, taxes, depreciation, and amortization).