For some background: James O'Keefe was suspended and later terminated by Project Veritas over alleged inurement (I wrote embezzlement above but the proper term is inurement - regardless of the exact word used the claim is that he spent Veritas' funds on personal expenditures) and inappropriate behavior towards employees and donors. In Veritas' telling he was suspended in early February but only fired in May while in O'Keefe's telling he resigned in mid-February because Veritas had made it impossible for him to do his job. The distinction is relevant because O'Keefe's employment agreement prohibited outside activities that conflicted with his work for Veritas.
Veritas is suing O'Keefe for breach of contract over forming and working for OMG when (in Veritas' narrative) he still worked for them. Regardless of which version is true, O'Keefe formed his own company called O'Keefe Media Group (yes, OMG) about a month later in March and donations to Veritas quickly declined as Veritas donors began giving to OMG instead. Veritas claims this was due to O'Keefe poaching its donors, O'Keefe's counternarrative is that the donors proactively reached out to him offering to move their donations. Again, they cannot both be true and only one of them is allowed under O'Keefe's employment agreement with Veritas which included a lifetime ban on soliciting Veritas donors- the wording of the employment agreement itself is not in dispute, only whether O'Keefe breached it is.
There are additional claims where the facts are not really in dispute: Breach of a non-disparage clause in the employment agreement which lasted indefinitely, breach of a non-solicitation of employees clause which lasted twelve months after O'Keefe left Veritas (the alleged solicitation of employees happened before the twelve-month cutoff no matter which narrative is true), and breach of an IP ownership clause over claims O'Keefe registered the copyright to books he wrote on Veritas' time to himself, rather than Veritas.
We now have O'Keefe's answer and counterclaim: The answer denies most of the allegations in the claim, and as affirmative defenses claims:
* The employment agreement is invalid under one or both of New York or Federal law. Considering how strict the employment agreement is, this is probably his best defense.
* Veritas breached the employment agreement, which rendered the entire agreement unenforceable, by suspending O'Keefe without pay which was not allowed under the employment agreement or company handbook.
* The alleged inurement is no longer actionable because of laches - O'Keefe claims the behavior was ongoing for over ten years. Regardless of the legal merits this is terrible PR.
If it looks like O'Keefe is trying to argue his employment agreement is invalid, it's because he probably has to - the employment agreement is so strict that if it is upheld, it will be nearly impossible for him to beat claims relating to the non-disparagement and solicitation of IP clauses.
Now for the counterclaims:
* Defamation. Some of the allegedly defamatory statements are plainly outside the statute of limitations, a couple may not be traceable to Veritas because they were made by members of Veritas' board on personal social media, but most importantly JAMES O'KEEFE IS ALLEGING DEFAMATION OVER CLAIMS HE HAS ASSBURGERS
* Intentional infliction of emotional distress/breach of privacy. Some of the leaks (e.g. Telegram messages to his now-ex girlfriend) might qualify (and support the assburgers theory, he literally said "I bought your breasts" in an argument with her) but others (like text messages discussing how to handle donor backlash after he was fired) seem flimsy.
* Breach of fiduciary duty: O'Keefe alleges that he was so integral to Veritas that the board firing him amounted to a breach of their fiduciary duty to Veritas (even if true, I'm not sure how an ex-employee could raise a claim on the company's behalf) and that the fundraising board's arm had a fiduciary duty to him personally. There might be proof but at first glance this sounds hard to believe; IANAL but I thought a corporate board was expected to act in a company's interests even when they conflicted with the CEO's.
Other random funny bits.
* Some of O'Keefe's claims about the Veritas board's actions come from a Rolling Stone piece on him + Veritas that his attorney calls a 'magazine-style article'. I didn't know DSP was ghostwriting lolsuits now.
* The Rolling Stone piece is mostly unflattering to O'Keefe: In its telling O'Keefe was always hard to work with and the pressure + ego boost that came with Veritas' rapid growth made things so bad the board felt it had to step in. Despite this O'Keefe's attorney strips out all that context and only leaves in a few lines where a board member reassured staff he could run the company in O'Keefe's absence. Obviously the board member was wrong but the citation only proves how powerful selective editing can be.
* Allegedly the Veritas board runs a Xitter account entitled "James O'Keefe the Panty Thief", which it uses to publish embarrassing details on O'Keefe. I am starting to think Veritas is run by five-year-olds now.
Edit to Add: It is difficult to see how anyone can really win here. If Veritas wins on all counts O'Keefe would have to pay 6, maybe even 7 figures in liquidated damages and downsize or close OMG. Neither of those will make disgruntled donors start giving again and without them Veritas will take years-decades to rebuild its revenue streams (assuming it does not go bankrupt before then, didn't it stop all work late last year?). If O'Keefe wins he would get a monetary judgment against a nearly bankrupt company and permission to keep doing what he has been doing for the past ~nineteen months and counting. The issue with disgruntled donors applies here too; the minority of donors who stayed with Veritas probably aren't going to start giving to O'Keefe if he wins here. He may not need that money to avoid bankruptcy but it would probably help him rebuild/build up OMG to the same size as Veritas.
