UploadVR operated a "sexually-focused" work environment, one of its former employees claims, with a "kink room" in the office where bosses had sex.
Elizabeth Scott, the former digital and social media director, says Will Mason, editor-in-chief and CEO Taylor Freeman discriminated against female employees.
The pair say "these allegations are entirely without merit".
In a statement given to Tech Crunch, Mr Mason and Mr Freeman say: "We are confident that the true nature of how we treat our employees and how we operate as leaders will shine through this unfortunate situation."
Male employees used that room to have sexual intercourse, which was disruptive and inappropriate
Legal documents filed by Elizabeth Scott
According to legal documents, Mr Mason and Mr Freeman "would frequently talk about how much sex they were going to have at each party, and how many girls they were going to have sex with.
"UploadVR even set up a room to encourage sexual intercourse at the workplace.
"The room was referred to as the 'kink room' and contained a bed.
"Male employees used that room to have sexual intercourse, which was disruptive and inappropriate. Often, underwear and condom wrappers would be found in the room."
The complaint was filed last week but many of the documents have only just been revealed.
Mr Mason and Mr Freeman recently appeared on a Forbes 30 under 30 list and their company has collaborated with a number of high-profile technology companies.
These allegations are entirely without merit
Will Mason and Taylor Freeman
Upload VR describes itself as a "community of diehard enthusiast" and produces a digital publication focused on virtual reality news.
There are also claims bosses tried to create a "boy's club" in the office and Ms Scott claims she and other female members of staff had to perform "womanly tasks".
These included cleaning the kitchen, organising the refrigerator and tidying up the workspace.
She says they were also required to clean up after parties which they had not even been invited to.
The women in the office were referred to as "mommies" and told to "help the men with whatever they needed".
Men at the company separated themselves from the women and sat together in a separate room and refused to allow Ms Scott to sit with them, legal documents claim.
In 2014, former Tinder executive Whitney Wolfe sued the dating app. It was over claims of sexual harassment by Tinder marketing chief Justin Mateen, and denied her rightful title of co-founder because she was a woman.
She received a settlement worth $1m (£800,000), with no admission of wrongdoing.
Earlier this year, ride-sharing company Uber said it would conduct an "urgent investigation" into claims of sexual harassment at the company, which is set to conclude later this month.
A former engineer at the company, Susan Fowler wrote a blog saying that shortly after joining the San Francisco-based company, her new manager made sexual advances towards her.
Newsbeat has contacted UploadVR for comment but is yet to receive a response.