The hottest fantasy in Silicon Valley involves a big, hot... tech bubble. Facebook and Yelp supposedly want one, so they can IPO in 2010; even Penthouse publisher FriendFinder Networks wants to go public, despite a sex harassment scandal.

FriendFinder Networks, the publisher of Penthouse and operator of adult-classifieds websites, is facing a sexy legal scandal. A former top executive who went public with her grievances has now filed a lawsuit.

Internet porn has devastated old-fashioned smut rags. We now hear a top executive at FriendFinder Networks, the publisher of Penthouse, wants to close the money-losing magazine down. But his boss denies it.

A porn star draping boobs over an employee's head. Lapdances on the company dime. $50 million in back taxes. These are just some of the charges Penthouse publisher FriendFinder Networks is facing from an ex-employee.

Andrew Conru, a geeky mechanical engineer turned porn baron who founded one of the Web's raciest personals site, made out well when Penthouse bought Adult FriendFinder. He even unloaded a $125,000 car on the operation.