- Gala Games CEO Eric Schiermeyer has filed a lawsuit against co-founder Wright Thurston, accusing him of theft of $130 million in GALA tokens, leading to a 13% drop in the token’s value.
- Wright Thurston was previously sued by the SEC for an alleged $18 million fraud in a separate venture.
The Web3 Coliseum: Litigation Unfolds Among Gala Games’ Top Brass
In an unfolding saga that has sent ripples across the Web3 gaming universe, Gala Games CEO Eric Schiermeyer and co-founder Wright Thurston have engaged in legal warfare. The aftershocks were immediately felt, as the GALA token price plummeted by 13%.
A Web of Accusations: Financial Misconduct and Deceptive Track Record
Schiermeyer’s litigation, lodged on August 31, 2023, indicts Thurston for siphoning off an astounding 8.6 billion GALA tokens in early 2021. Sold off stealthily before the company could intervene, these tokens reportedly translated to a $130 million windfall for Thurston. Schiermeyer further imputes that Thurston has a notorious record of founding enterprises that ultimately find themselves mired in lawsuits, insolvency, or regulatory scrutiny.
Notably, this is not an isolated financial transgression for Thurston, who faces a parallel lawsuit from the SEC. The case implicates him in a scheme that allegedly swindled investors of $18 million, adding another layer of complexity to the whole affair.
The GALA Token Fiasco: Undermining a Digital Ecosystem
Schiermeyer’s lawsuit reveals a precarious situation that hung over Gala Games. Unveiling the theft would have triggered a probable liquidation of GALA holdings by Thurston, thereby imperiling the entire GALA digital ecosystem. As a risk mitigation measure, the company issued Gala v2 tokens in May 2023. Officially touted as an upgrade with
“enhanced security features,”
Schiermeyer avers that the true intent was to render the stolen tokens in Thurston’s wallets obsolete, without destabilizing the larger ecosystem.
By the time of the token upgrade, half of the stolen tokens had been laundered through centralized exchanges, converting into a $130 million bounty for Thurston. Schiermeyer alleges that when confronted, Thurston’s initial explanation was that he was liquidating some of the GALA tokens
“to purchase ammunition for firearms.”
Thereafter, he went radio silent.
Counter Lawsuit: Thurston’s Version of Events
Filing his own lawsuit, Thurston retorts that Schiermeyer has been operating the company unilaterally, effectively sidelining him from the corporate decision-making process. He blames Schiermeyer’s “malfeasance, mismanagement, and self-dealing” for tarnishing Gala’s reputation and inflicting financial damage in the hundreds of millions.
Gala Games remains tight-lipped, not offering any comments when approached for clarification. With lawsuits piling up and the token value taking a hit, the saga casts a shadow on Web3 gaming, bringing into question the viability and governance of blockchain-based startups.
