Project Veritas, a conservative organization based in Mamaroneck that exposes liberal institutions that it considers corrupt or wasteful, has sued its founder and former CEO for alleged improper and wasteful practices.
Project Veritas accused James O’Keefe of lavish spending and misappropriating trade secrets in a complaint filed May 31 in U.S. District Court, White Plains.
“Being known as the founder of an organization does not entitle that person to run amok and put his own interests ahead of that organization,” the complaint states.
O’Keefe did not respond to a request for comment that was submitted through the website of O’Keefe Media Group, a new organization he runs. But on June 1,  OMG’s website published a post asking for donations to help O’Keefe defend himself and “defend against attacks designed to silence him!”
O’Keefe founded Project Veritas in 2010 as a nonprofit journalistic organization that exposes political corruption. Critics contend that it uses deceptive tactics to provoke and embarrass liberals.
Last September he signed an employment agreement for the CEO position, paying $430,920 a year.
He agreed to keep key information confidential, including Project Veritas projects, organizational practices, and donors; to not disparage the organization; and to not solicit donors or employees for up to a year after his employment ended.
Violations of the non-disclosure and non-disparagement clauses would cost at least $100,000 per breach.
At some point, the board of directors became aware of allegations by employees, according to the complaint, about an “incredibly troubling workplace and financial misconduct.”
For instance, O’Keefe allegedly used a private car service to drive him around Manhattan and then wait for him outside of restaurants for hours, costing Project Veritas more than $150,000 over the past 18 months.
Employees alleged that he directed the organization to pay more than $10,000 for a helicopter flight from New York to Maine without a clear benefit to Project Veritas; that he stayed at luxury hotel suites while other employees on the same trips stayed in budget hotels; and that he traveled first-class even when the flights did not satisfy organizational policy.
Employees complained that they had to run personal errands for O’Keefe, such as cleaning and repairing his boat and picking up his laundry.
They claimed that he behaved unprofessionally at team meetings, screaming at and belittling them; targeted female employees with mean-spirited comments, and routinely showed up late for meetings with donors.
The board of directors – volunteers who were handpicked by O’Keefe, according to the complaint — created an audit committee and hired outside counsel to investigate the allegations.
On Feb. 6 the board placed O’Keefe on paid leave. The intent was to reinstate him with appropriate safeguards, according to the complaint. He still remained as CEO and as a member of the board. But he could no longer hire and fire staff or access donor lists and other proprietary information, and he had to surrender his credit card.
Still, according to the complaint, O’Keefe paid for about $19,000 in personal expenses with his Project Veritas credit card.
O’Keefe appeared on several programs, such as “Steve Bannon’s War Room” and “The Charlie Kirk Show,” according to the complaint, claiming that he had been fired because of a critical story about Pfizer pharmaceuticals.
On Feb. 16, O’Keefe demanded all of the board members and most Project Veritas officers to resign, according to the complaint, and said he would not return unless he was given unilateral control.
On Feb. 17, he formed O’Keefe Media Group, also based in Mamaroneck, “with substantially the same mission and structure as Project Veritas,” the complaint states.
On April 24, he was formally removed from the board and on May 15 he was fired.
Project Veritas is accusing O’Keefe of breaches of contract, fiduciary duty, and loyalty; misappropriating trade secrets; and  conversion of assets. O’Keefe Media Group is accused of interference with contracts.
Project Veritas is represented by Hartford, Connecticut attorney Jay M. Wolman and Gloucester, Massachusetts attorney Marc J. Randazza.
