Upload, the VR startup which was rocked by a sexual harassment suit exactly one year ago, is shutting down both its San Francisco office and its 20,000 sq. foot Los Angeles co-working space as it struggles to secure new funding, multiple sources tell TechCrunch.

All of the company’s LA employees were laid off yesterday. The company’s SF office lease has already been taken over. The startup’s VR-focused trade publication, UploadVR, which operates independently of the company’s other ventures, has not been affected yet, sources tell us.

The layoffs and office shut downs come as the company has had trouble raising new funding and managing its reputation following a bombastic lawsuit from the company’s former social media manager that landed the startup on the front-page of the New York Times and on a CNN special feature talking about the company’s toxic workplace environment. The sexual harassment and wrongful termination lawsuit, which we first reported, alleged — among other things — that the company had a “kink room” with a bed in its office where male employees had sex.

As the company wrestled with the fallout, at least one additional former female employee was also threatening to sue the company’s leadership over sexual harassment claims, a source tells us. In the aftermath of the lawsuit, the company brought on CircleClick CEO Anne Ward as COO to turn things around at the troubled startup.

Ward left the company just six weeks later, and soon sent a cease and desist letter threatening a restraining order against Upload CEO Taylor Freeman and President Will Mason after what she alleged was “repeated harassment.” Though the initial lawsuit was later settled out of court, the bad behavior didn’t end there for Upload. In a subsequent incident, an employee at the startup was reported to management for having sex with a client in the office. Read more from techcrunch.com…

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