Project Veritas sues its founder James O'Keefe, alleging he set up a competitor and wooed donors while on the company's payroll

• Project Veritas is suing its founder and former leader, James O'Keefe.
• O'Keefe set up a competitor right-wing political sting operation earlier this year amid allegations of financial misconduct.

The right-wing activist group Project Veritas filed a lawsuit Wednesday against its founder, James O'Keefe, alleging he violated his employment agreement by establishing a competing organization and wooing away donors while still on Project Veritas' payroll.

"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 lawsuit says. "Defendant James O'Keefe ("O'Keefe") failed in his duties to Plaintiff, Project Veritas, causing it serious and significant damage."

Project Veritas quickly became an important part of the right-wing political and media ecosystem after O'Keefe founded it in 2010.

It has conducted sting operations against perceived enemies, including Planned Parenthood, Pfizer, and mainstream media outlets, Pfizer. A number of its operations have backfired on the organization, including an unsuccessful effort in 2017 to plant a false sexual misconduct allegation against then-US Senate candidate Roy Moore in the Washington Post.

According to the lawsuit, the Project Veritas board of directors placed O'Keefe on paid leave on February 6 following accusations from employees that he mismanaged finances, targeted female employees, and "behaved unprofessionally during team meetings, including by screaming at coworkers and belittling them and their contributions to Project Veritas."

Company employees have additionally alleged that O'Keefe had "strained relationships with several donors because he was routinely late for meetings and rude at VIP events designed to give donors extra access to O'Keefe," the lawsuit said.

The complaint also accused O'Keefe of using company funds to finance his lifestyle. Among other things, the suit alleges that O'Keefe used a company credit card to book lavish hotel rooms and private car services; flew first class on Project Veritas' dime in cases where the flight was not covered by the company's policy for approving first-class flights; and directed Project Veritas to shell out more than $10,000 for a helicopter from New York to Maine.

He racked up roughly $19,000 in personal expenses on the company card even after his permission to use it was revoked upon being placed on paid leave on February 6, the lawsuit said.

Later that month, O'Keefe founded the O'Keefe Media Organization, which is also a defendant in the lawsuit along with two other Project Veritas employees who assisted with the project.

The O'Keefe Media Organization directly competes with Project Veritas — a violation of O'Keefe's employment contract, Project Veritas alleges. O'Keefe also solicited donors using a confidential list kept by Project Veritas, according to the lawsuit.

"O'Keefe has and continues to solicit Project Veritas's donors, employees and contractors, in direct violation of his Employment Agreement, for and on behalf of OMG," the lawsuit alleged.

During this period of time, O'Keefe was still on Project Veritas payroll, according to the lawsuit. He was kept on the board until April 24 and removed from the company entirely on May 15, the lawsuit said.

O'Keefe didn't immediately respond to Insider's request for comment.