key takeaways :
- Gala Games face internal turmoil as its CEO and Co-Founder have filed lawsuits against each other, causing significant disruptions within the company.
- The ongoing legal disputes have led to a 72% drop in Gala Games’ stock value in 2023, eroding investor confidence and financial stability.
In a recent lawsuit filed in the United States District Court for the District of Utah, internal conflicts have come to light within Gala Games, a prominent player in the web3 gaming industry. Co-founders Eric Schiermeyer and Wright Thurston have both initiated legal actions against each other, with these legal documents becoming public on August 31, 2023.
Here’s a breakdown of the key allegations and consequences:
Eric Schiermeyer’s Lawsuit:
Gala Games CEO Eric Schiermeyer has sued co-founder Wright Thurston, alleging that Thurston took 8.6 billion GALA tokens in early 2021 and managed to sell them for $130 million before the company could intervene.
Schiermeyer’s suit also accuses Thurston of a pattern of founding companies that end up insolvent, bankrupt, or entangled in legal disputes.
Wright Thurston’s Lawsuit:
Thurston, in his counter-lawsuit filed on the same day, claims that Schiermeyer seized control of Gala Games to divert company funds for personal use, including financing a private jet.
While the Gala Games leadership remains mired in legal battles, some members, like Jason Brink, President of Blockchain at Gala Games, have opted to maintain a neutral stance. Brink has confirmed the existence of these lawsuits and expressed hope that they will bring transparency to the company’s operations.
The internal turmoil has had a significant impact on Gala Games and its native token, GALA. As of early September 2023, GALA had experienced a substantial decline, losing 72% of its value from its peak in January, nearing an all-time low.
It’s important to note that while the legal disputes have certainly contributed to this decline, broader market conditions affecting cryptocurrencies like Bitcoin and Ethereum have also played a role. Nonetheless, these legal conflicts have added further uncertainty for investors and stakeholders, casting doubt on the company’s stability and future prospects.
According to documents filed with the United States District Court for the District of Utah, Eric Schiermeyer has leveled allegations against Thurston and his company, True North United Investments, LLC, accusing them of pilfering a significant sum of 8,645,014,077 GALA tokens from Gala Games.
As detailed in the extensive 76-page filing, Thurston is alleged to have meticulously orchestrated a “complex web of obfuscatory transactions” to transfer, exchange, or sell these tokens, amassing the aforementioned quantity. Crucially, these actions were executed before the company could intervene.
This lawsuit is noteworthy within the Web3.0 ecosystem, especially given the current climate in which the industry is uniting to collectively confront the United States Securities and Exchange Commission (SEC). This unified effort aims to advocate for comprehensive regulation in the industry, making Schiermeyer’s legal action a unique and potentially precedent-setting case amid these broader industry developments.
