By Sebastian Smith Sebastian Smith

NEW YORK (AFP) – Woody Allen and American Apparel, a clothing company known for ads featuring scantily clad models, are fighting dirty ahead of a court showdown next month.

Photo: AFP/File/Pierre Verdy

Allen is suing American Apparel for putting his image from the 1977 movie "Annie Hall," where he appeared as a Hasidic Jew, on billboards without his consent.

The film maker calls American Apparel, whose eccentric founder strips to his underwear in the office and has reportedly masturbated in front of a journalist, "sleazy."

Allen seeks 10 million dollars compensation -- the amount he says he'd charge if he had agreed to an endorsement -- in the trial scheduled to start May 18.

The California company, whose tight-fitting lingerie and casual wear enjoy a cult following, says Allen's colorful personal life leaves him without much of an image to defend.

American Apparel lawyers contend that the "sex scandal" of Allen's marriage to adopted daughter Soon-Yi Previn, after a bitter divorce from actress Mia Farrow, will be fair game.

Lawyers say in court documents they intend to show "the highly publicized sex scandal and custody battle" impacted on Allen's career and the value of his image.

The dispute began two years ago when American Apparel used the Allen picture, in which he wears a thick Hasidic-style beard, on billboards in New York and Los Angeles.

Although Allen is believed to have appeared in advertisements early in his career, he has long avoided making endorsements.

In a deposition last December, Allen said he would not touch American Apparel, or its notorious ads, with a barge pole.

"The ones that I saw were -- were, you know, sexually gross in a witless and infantile way," he said, adding that American Apparel had a "sleazy image."

Allen, whose films are known for neurotic comedy and quick-fire dialogue, said that if he ever did do a commercial, it would have to be for "a large amount of money."

He said he'd consent to doing advertising only if it was "a very clever, kind of witty or intellectual-style commercial."

Allen's nemesis is Don Charney, the Canadian founder and CEO of American Apparel, which unlike many manufacturers hires all-American staff, rather than cheap foreign labor.

Charney's own image has been tarnished by sexual harassment law suits and reports of bizarre behavior, including exposing himself in work-related settings.

Charney appears to revel in the notoriety, admitting in 2006: "I frequently drop my pants to show people my new product."

A reporter for Jane magazine spent time with Charney in 2004 to research a profile and said that the CEO masturbated in front of her.

One of the women filing sexual harassment suits against him complained her boss turned up to a business meeting at his home wearing a special sock on his penis -- apparently a potential new product.

American Apparel's lawyer, Stuart Slotnick, told the New York Post tabloid that Allen was the one who would have to prove his worth in court.

"We believe that Mr Allen's popularity has decreased significantly, especially in light of the scandals he's been associated with. We believe that he greatly overvalues the worth of his endorsement -- if he can get one," Slotnick said earlier this month.

Last week, Allen's lawyers shot back, accusing American Apparel of mounting a "campaign to tarnish Mr Allen's reputation a second time."