Nasty Gal files for bankruptcy, but the clothing retailer has been hurting for a while

On Thursday, Women’s Wear Daily reported that clothing retailer Nasty Gal is filing for chapter 11 bankruptcy protection. The company was founded in 2006 as a vintage shop on eBay, but founder Sophia Amoruso quickly turned the business into a full-scale online business, with two Los Angeles area stores. Amoruso tapped into the millennial women market and although the company was pulling in $100 million in sales at one time, according to Recode, it’s had troubling finding a way to keep going. Amoruso will also step down as executive chairman, in charge of the creative side of things. This has not been a good week for nasty women, and even the Hillary Clinton rallying cry couldn’t save the company.

CEO Sheree Waterson said in a press release sent to The Frisky, “Our decision to initiate a court-supervised restructuring will enable us to address our immediate liquidity issues, restructure our balance sheet and correct structural issues including reducing our high occupancy costs and restoring compliance with our debt covenants.” Waterson added, “We expect to maintain our high level of customer service and emerge stronger and even better able to deliver the product and experience that our customers expect and that we take pride in bringing to market.”

Nasty Gal went through two rounds of layoffs this year — one in February and one in October, when it laid off the entire design team. In September, WWD reported that the company was “aggressively” looking for capital.

The company was mildly inspiring at first — watching 22-year-old Amoruso build a successful company and write a New York Times bestseller about being a #GIRLBOSS is just the kind of thing that gets some women all warm and tingly inside. But the company trying to sell feminism had multiple problems. For one, some of it’s products were low key racist. So, there’s that. But in addition to cultural appropriation, Nasty Gal allegedly wasn’t all about empowerment. Three former employees filed a lawsuit in 2015 alleging they were illegally fired for being pregnant. Not only that, but the company allegedly didn’t offer them the four months paid leave that California law mandates.

Talk about nasty.

Nasty Gal’s former accountant Farah Saberi also filed a lawsuit, claiming she was fired because she was too sick. Not like “I called out of work for being hungover” sick, but actually sick. She had end-stage renal failure in 2013 and needed a kidney and pancreas transplant. She also had bypass surgery to fix an artery in her heart. But her role at Nasty Gal was “eliminated” in 2014, according to her suit. Saberi also claimed she was offered a severance package that would give her two weeks pay and six months of healthcare as long as she didn’t sue the company.

Nasty Gal never responded publicly to the allegations, though Jezebel was forwarded an internal email from Nasty’s Gal’s Kim Hunt, head of people and culture, encouraging employees to direct press inquiries to their PR office and not speak about the reports.

If Nasty Gal is able to work out its financial problems, hopefully it will fix its people problems, too.