Ex-staffers of the metaverse company have accused CEO Janine Yorio of ‘vulgar’ sex talk and harassment, but she says it’s all a big shakedown.
While Facebook founder Mark Zuckerberg appears to be retreating from his metaverse dreams, other entrepreneurs have their own visions for virtual worlds—including immersive media startup Everyrealm, which promotes members-only “ultra-luxury” spaces that will be sold as NFTs, and a “premier island community” on The Sandbox platform, called Fantasy Islands, where it sold a digital $650,000 superyacht that one writer once characterized as “comically hideous.”
In a recent video podcast, Everyrealm CEO Janine Yorio presented a transgressive vision for metaverse users. “People want a safe space to make bad decisions,” Yorio told Tech Snippets Today. “They want vice, they want unfortunately to destroy things, and to do things that are harder to do in real life or often carry a lot of consequences.”
Players on virtual platforms and games, Yorio added, “have to embrace the fact that oftentimes that comes with content that isn’t G-rated.”
But Yorio is facing some R-rated accusations herself.
Three former employees have filed lawsuits claiming she fostered a hostile and toxic environment, one where workers’ sex lives were fair game and where Yorio allegedly made advances on colleagues, telling one subordinate that she and her husband were “only married in the Metaverse.”
Former NFL player Teyo Johnson, who worked at the company for just three months, claims Yorio and her New York-based firm “used their positions of power to sexually harass, discriminate against, and retaliate against” him.
The court battle between former staffers and Yorio and her metaverse innovation fund—which has a range of celebrity investors including Paris Hilton, The Weeknd and Nas—has turned ugly, with the company’s attorneys filing lurid private texts to the public docket. They also revealed in court filings that one former HR director, who filed a suit against the startup and is represented by Johnson’s attorney, actually helped to terminate him.
The startup argues Johnson and three other former employees engaged “in a coordinated effort to shake down” the company for out-of-court settlements totaling $7.4 million. (Only three employees filed lawsuits, however, against Everyrealm.)
In a filed legal memorandum, Everyrealm called Johnson’s suit a “money grab” intended “to garner publicity—and to try to harm Everyrealm, especially in its relations with its investors.”
While the startup argued that Johnson must pursue his harassment and discrimination claims in arbitration as agreed upon under his employment contract, the onetime football player said his case belonged in court because of a landmark #MeToo law, the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act, which passed last year.
Everyrealm claimed Johnson “fabricated a new narrative involving allegations of sexual harassment” to sidestep arbitration. But in February, U.S. District Judge Paul Engelmayer disagreed and allowed Johnson’s case to proceed, ruling that he “pled a plausible claim.”
On Friday, Johnson filed an amended complaint adding claims of post-employment retaliation and alleging Everyrealm “leaked some or all of his employee personnel file” and private tax returns to journalists and other third parties.
Former Everyrealm employees told The Daily Beast that the allegations against Yorio didn’t surprise them and some were even aware of them at the time. “Generally inappropriate comments as a normal part of company culture was a ticking time bomb,” said one ex-staffer, adding, “There’s a lot of room for improvement.” (The lawsuits allege multiple instances of crude commentary, including Yorio supposedly saying, “all the men here are castrated,” that one of her co-founders was “an incel” who she hoped would “have gay sex” with someone at a tech conference, and a female executive was a “neurotic anorexic.”)
“It was an unhealthy workplace,” a second former employee said. “The way that she treated everyone, you know, there’s going to be unhappy people.”
Yorio, in a statement to The Daily Beast, called her ex-employees’ litigation “legal terrorism” and “a shakedown disguised as wrongful termination suits.”
“Against repeated advice, I remain staunchly opposed to ‘writing a check’ to make these baseless lawsuits go away,” Yorio said. “We didn’t do any of these things, and so I refuse to succumb to lies and terrorist legal tactics.”
“These former employees worked at Everyrealm for only a few months each, one quit voluntarily and two were fired for poor performance. Since the beginning, we have refused to pay them a nickel—because that is what they deserve,” she said.
“The truth is that there was an obvious and non-discriminatory reason for the terminations and resignations: these people were really bad at their jobs. The harassment and hostile work environment claims are just smoke and mirrors to deflect from that central fact.”
Shane Seppinni, a lawyer for Johnson and three other former Everyrealm employees, said that the company’s response shows “what individual workers are up against when they decide to bring claims against their employers.”
“There’s no shakedown,” Seppinni told The Daily Beast. “They prodded us to make a demand with, I believe, the intent of leaking it to garner sympathy for themselves.”
“I love the concept of bringing a new product out, having something hot and selling it,” Johnson told the Herald. “You see these guys who make tons of money selling different things, and you ask yourself, why not me?”
In a resume submitted to Everyrealm, Johnson listed roles that included director of business development for Yao Family Wines, managing partner at a legal marijuana company in Washington state, and independent contractor for Caerus Investment Advisors. At Caerus, Johnson notes, he secured new clients including boxing legend Mike Tyson and NBA guard James Harden and raised $3 million for SpaceX. (On LinkedIn, Johnson indicates he’s a self-employed private equity specialist based in Las Vegas.)
Photo Illustration by Luis G. Rendon/The Daily Beast/Everyrealm/Getty
According to his lawsuit, Everyrealm recruited Johnson after he connected someone in his rolodex to the firm, leading to a $500,000 investment in the startup’s $60 million Series A round led by Andreessen Horowitz. Prominent investors included Coinbase Ventures, film producer Jeffrey Katzenberg, and Gene Simmons of KISS fame. (Yorio, however, told The Daily Beast that Johnson “never raised one dollar for the company” and that his first day at the firm came weeks after Everyrealm’s investment round closed.)
Yorio and executives were “impressed by this, Mr. Johnson’s professional network, his experience in commercial real estate, and his skills” and eventually made him Everyrealm’s Director of Strategic Partnerships in March 2022, the complaint says.
Two months prior, Johnson sent Yorio a glowing email. “This is a once in a lifetime opportunity,” he wrote, adding, “I would love to be a part of your team and I believe you are a leader that I can follow and will run through a wall for (pun intended).”
“I will give you my best, conduct myself as a professional and never embarrass the company,” Johnson added in the message, which was filed as a court exhibit.
His journey into the metaverse apparently didn’t go as planned.
Johnson claims the harassment began days after he was hired, when he and company executives attended the South by Southwest (SXSW) conference. His lawsuit says Yorio encouraged employees to play a “sex-related game” she called “KYP” or “Know Your Personnel,” which involved hooking up with colleagues. Johnson alleges that she told him there was an alternate version for romps with business partners: “KYC” or “Know Your Client.”
When two web3 divas cross paths. @ParisHilton pic.twitter.com/Ea2hoJQNpu
— janineyorio (@janineyorio) March 16, 2022
At their hotel at night, the complaint says, Yorio approached Johnson and suggested he “would cheat on [his girlfriend] if the opportunity arises.” From Johnson’s perspective, Yorio, a married mother of two kids, seemed to be “inappropriately ‘testing the waters’ with him” after telling him in his job interview that he was “more than just a pretty face.”
Back in New York, Yorio repeatedly asked Johnson if he had “done” or planned to engage in any “KYP,” the complaint says. (In a motion to dismiss, Everyrealm claimed the game was “a fabrication by Johnson” and “apparently an acronym used in football and one that is completely foreign to Mrs. Yorio.” They also say “Johnson brought a woman to various evening events with whom he was occupied during the times of the alleged conversations between Mrs. Yorio and Johnson.”)
Johnson claims his then-girlfriend also became a target. When the woman brought her service dog to a company party, the lawsuit says, Yorio and fellow executive Julia Schwartz gave them “dirty looks” and “refused to acknowledge” them.
“Mr. Johnson has described their behavior as being like a scene ripped from the movie ‘Mean Girls,’” the complaint says, with the women allegedly nicknaming his girlfriend “Dog in a Bag” and telling employees they thought she “was lying about her mental illness so that she could bring her dog around ‘like Paris Hilton.’”
The following day, Yorio allegedly approached Johnson, asking if he was late because he “hooked up with Dog in a Bag.” The complaint says that while Johnson “made it abundantly clear that he was uncomfortable” with the conversation, Yorio wouldn’t give up.
“They want vice, they want unfortunately to destroy things, and to do things that are harder to do in real life or often carry a lot of consequences.”
— Janine Yorio, on players in the metaverse
Johnson, worried about not being viewed as a team player, finally shared why he didn’t have sex with his girlfriend that night: she was menstruating. “After this exchange,” the filing states, “Ms. Yorio told multiple people in the Everyrealm New York City office that Mr. Johnson was ‘walking around telling people that ‘Dog in a Bag is on the rag.’”
The inappropriate talk also allegedly extended to partners of the company.
Johnson claims Everyrealm’s general counsel William Kerr referred to celebrity investor Paris Hilton—who performed a DJ set at a company SXSW event—as “A Night in Paris,” the title of the leaked sex tape which she has said was “extremely painful” and “humiliated” her.
Yorio, Johnson says in his complaint, also “made a habit of referring to” business partners’ genitals during private meetings with him and called one partner a “Big Swinging Dick.” Johnson claims the use of such language ultimately sabotaged a partnership he was cultivating.
After Johnson negotiated a deal with a marijuana and CBD firm, Cookies, he and Yorio held a celebratory meeting at SXSW. But during the get-together, Yorio allegedly called the weed company’s president Parker Berling a “dick” and “fucking dick,” in response to Berling’s questions about who Everyrealm viewed as their competition. “I’ve never seen someone react so hostilely to a basic question like this. Are you ok?” Berling allegedly asked, according to Johnson’s complaint.
Johnson claims this led to the arrangement falling through, and that Yorio demanded Johnson “fix it.” He says he was demoted after failing to revive the deal, placed on a retaliatory performance improvement plan, and ordered to hand his entire personal rolodex to Schwartz and another employee who replaced him.
The lawsuit also details allegations of racism and says that as “the only Black man” at the company at the time, he was afraid to challenge Yorio.
“I am aware of other Black men at Everyrealm who experienced pervasive sexual harassment at the hands of Ms. Yorio and Defendants,” Johnson said in a September court declaration, in which he claimed his unwelcome treatment “was likely caused, at least in large part, by Ms. Yorio’s improper fetishization of Black men.”
Photo Illustration by Luis G. Rendon/The Daily Beast/Everyrealm/Getty/Twitter
According to the lawsuit, Yorio declared after Johnson’s job interview, “Teyo is the whitest Black guy I’ve ever met.” When the HR director confronted Yorio about her comments, Yorio allegedly responded, “No, I meant it in a good way.”
Yorio is also accused of telling Johnson, “[You’re] lucky that went well, now I don’t have to trade you” after he led a meeting with LeBron James’ entertainment company. The lawsuit says she “made this same, tired racist comment numerous times.”
Johnson’s complaint says “his qualifications and intelligence were frequently questioned and disparaged at Everyrealm due to the color of his skin.” In April 2022, Yorio allegedly told colleagues that Johnson “needs to go” and complained, “He isn’t smart, he doesn’t know asset management and he absolutely does not know our industry. He does not put our best foot forward.”
After Johnson was terminated in May 2022, the lawsuit says, Yorio told coworkers, “It’s worse to have a stupid Black person on the team because then you’re really just exploiting them and making it look like you’re trying to be diverse.”
Johnson, who was offered a $125,000 base salary, claims he was the lowest paid director in Everyrealm’s history; directors in similar roles had been paid hundreds of thousands more and granted millions in equity in Everyrealm and its then parent company, Republic. Yorio also allegedly called Johnson “expensive” to other employees.
“The way that she treated everyone, you know, there’s going to be unhappy people.”
Everyrealm, in a motion to dismiss, says that “contrary to Johnson’s claims, he was employed in a low paying manual labor job at the time of his hire.”
The company put forward accusations of their own, saying “it was Johnson who encouraged discussions regarding sexuality and promiscuity” and filed an exhibit showing a Slack message between Johnson and Kerr. “What’s the latest from Las Vegas?” Kerr asked, and in reply, Johnson shared a selfie and a photo of three women at a high rise overlooking a cityscape. “Who’s the chica in the hat?” Kerr asked. Johnson answered, “21 year old smoke show, her BF is older than me. Gonna snatch it up when they part ways. Gonna catch and release BK!!”
In another filing, the startup claims Johnson “openly and routinely disparaged the mother of his child and demanded that Everyrealm pay a portion of his wages in cash to avoid garnishment for child support payments (a request that was refused by Everyrealm).” The firm also claims Johnson referred to a company director as “that bitch” and Yorio as “that crazy bitch” and disparaged a junior female employee as a “rookie.”
Johnson, Everyrealm claims, was put on a performance improvement plan because “he visibly fell asleep as his desk in the company’s open pit-style office, failed to meet his business goals and violated the company’s expense policy by using his corporate credit card to pay for personal expenses and business expenses that were never approved.”
Everyrealm alleges in court filings that it fired Johnson over “a plethora of inappropriate misconduct” including “flagrant misogyny toward his female co-workers as documented by then-Human Resources Director Kathy Yost,” who also sued the startup.
Seppinni said in court papers that Everyrealm’s exhibits were “scrounged from a one-sided discovery process” and “lack context,” court papers reveal.
“Having failed to support their motion on the merits, Defendants insult Teyo for working a manual labor job over a decade ago … and now have twice divulged Plaintiff counsel’s confidential settlement demand, which was made upon Defendants’ request, in their bad faith attempt to discredit Teyo,” Seppinni said in one court filing.
“CEO Yorio admits that she revels in her use of ‘vulgar’ language at work,” Seppinni added, “and that ‘it won’t be the last time’ she refers to men in the office repeatedly and unabashedly by the sexually derogatory term ‘pussy.’”
Still, an exhibit filed by Everyrealm shows how friendly it all started out.