YouTube Creator SXSBlog Sues Ex-Employee for Allegedly Pocketing Over $230k in Revenue, Including Crypto Transactions

On Monday, July 22, 2024, SXSBlog filed a lawsuit against former employees Nicholas and Danielle Leonard in federal district court. The Michigan-based YouTube channel and lifestyle brand is alleging financial malfeasance, conspiracy, copyright infringement, and more against the husband and wife duo.

In its complaint, SXSBlog claims that Nicholas Leonard was fired from his role as video editor in November 2023 after an employee witnessed him make an unauthorized personal purchase with a company debit card. An investigation then uncovered evidence that Leonard had been embezzling funds from the company’s YouTube, Patreon, and other accounts for over two years, siphoning more than $233,000 to personal bank, cryptocurrency, and debit card expenses without permission.

SXSBlog is owned in equal parts by Douglas Butterfield, Nicholas Sous, and Danielle Leonard. However, the company alleges that due to Nicholas Leonard’s past financial issues, his share was put in his wife’s name to avoid collections. Danielle Leonard acted as a silent partner and did not have an active role in operations.

The complaint states that from 2021-2023, Nicholas Leonard failed to deposit over $114,000 from YouTube earnings, more than $31,700 from unauthorized debit card purchases, nearly $20,000 from Patreon, and over $65,500 in cryptocurrency transactions—moving company funds to Danielle Leonard’s personal wallet. SXSBlog accuses the Leonards of breach of fiduciary duty and conspiracy in the reported conversion of company money.

Additionally, after terminating his employment, Nicholas Leonard falsely claimed sole copyright of SXSBlog’s edited YouTube videos. He submitted 20 takedown notices to YouTube in February 2024, resulting in the temporary removal and loss of monetization of videos. YouTube ultimately reinstated the videos, determining that as work created for hire, the copyright belonged to SXSBlog.

SXSBlog seeks damages, return of pilfered funds, and return of control over its various social media, web domain, and affiliate program accounts that Nicholas Leonard allegedly changed passwords and locked the company out of after his firing. The complaint also lists racketeering and defamation claims against the defendants, who are now competing in the same YouTube space through their new company, Race Rebuild Repeat.

Please contact BlockTribune for access to a copy of this filing.