If this is even two-thirds true, James O'Keefe should never get a dime from any reputable conservative, or any reputable news organization, ever again. This looks to be absolutely inexcusable. Read it yourselves, including following all the internal links.
Short version: O'Keefe planned to lure a CNN reporter onto a boat which, inside, featured all sorts of sexual paraphernalia, and then to try to seduce her on camera. The idea was to somehow expose her as being unprofessional, or something.
Read all the documents. O'Keefe's plan was both ludicrous and juvenile. I cannot imagine him having an even semi-reasonable explanation. Unless he does, he should be ostracized by the entire conservative movement. Period.