Dov Charney 'Sex Slave' Lawsuit Will Settle Out of CourtKatie J.M. Baker3/22/12 10:40amFiled to: American AppallingDov CharneyIrene moralesLawsuittweetGettypic19EditPromoteShare to KinjaToggle Conversation toolsGo to permalink Irene Morales, the 21-year-old former American Apparel manager who said last year that the company's notoriously sleazy founder, Dov Charney, had sexually harassed her since she was 17, will have to settle her case behind closed doors. The official reason for tossing the original $260 million lawsuit, originally slated for a Brooklyn courthouse, is because a California court already ordered the same case into arbitration. But Charney's lawyer, Stuart Slotnick, said he had argued the case shouldn't go to trial at all because Morales signed a deal when she quit the company agreeing to submit all complaints to confidential binding arbitration — the infamous American Apparel "gag rule" that we've covered before. "We've always held these claims to be frivolous," Slotnick told the NY Post. "We expect they will be dismissed."ShareTweet Kinja is in read-only mode. We are working to restore service.