THE FOUNDER OF the American Apparel clothing chain is facing a $250 million law suit by a former employee, who claims he kept her captive in his apartment and forced her to be be his ‘sex slave’.

The New York Post reports that Irene Morales has just turned 18, and was working as a sales clerk at the American Apparel store in Manhattan, when her boss allegedly asked her to come to his apartment.

The New York Daily News details how the suit claims that Dov Charney – who is notorious for his preference for conducting his business meetings in the nude and has openly referred to female employees as ‘sluts’ – “held Morales prisoner” and forced her to perform a number of sex acts on him.

It states:

She was, to all intents and purposes, held prisoner in his apartment for several hours and forced to perform additional sex acts upon defendant Charney.

American Apparel has responded to the suit by issuing a statement saying that Morales “resigned with a letter of gratitude regarding her positive experience at the company”.

Lawyers for the company added that she signed an agreement not to sue but to settle any claims through a binding arbitrator.

In the past, Charney has spoken openly about his intimate relationships with women who work for him.

“I’m not saying I want to screw all the girls at work,” he was quoted as saying in Jane magazine, “But if I fall in love at work it’s going to be beautiful and sexual.”

TheStreet.com reports that Charney has fought off a number of sexual harrassment suits in the past.

However, his company has also been praised for its refusal to have its clothes manufactured in sweatshops in developing countries. The staff at the American Apparel factory in Los Angeles are paid twice the minimum wage.