Gala Games CEO Accuses Co-founder of Stealing and Selling $130M Worth of Tokens

CoinCarp News - Gala Games co-founders sue each other over $130 million token theft

Gala Games, a Web3 gaming startup, is facing a legal battle between its two co-founders, Eric Schiermeyer and Wright Thurston. Schiermeyer, the CEO of Gala Games, claims that Thurston stole 8.6 billion GALA tokens worth $130 million from the company in early 2021 and sold them before being caught. Schiermeyer also accuses Thurston of having a history of creating failed businesses that end up in debt or lawsuits.

Thurston, on the other hand, alleges that Schiermeyer seized control of Gala Games and used the company's funds for personal expenses, such as buying a private jet. Both co-founders filed lawsuits against each other on August 31.

Gala Games was founded in early 2019 by Schiermeyer and Thurston, who each owned 50% of the company. The third co-founder, Michael McCarthy, is not involved in the litigation. The company develops Web3 games that use blockchain technology and GameFi features. Its latest product is Champions Arena, a mobile RPG game. It also has projects in blockchain-based music, film, and digital collectibles.

Eric Schiermeyer, the CEO of Web3 gaming startup Gala Games, has filed a lawsuit against his co-founder Wright Thurston, alleging that Thurston stole 8.6 billion GALA tokens from the company and sold them for $130 million. Schiermeyer also claims that Thurston has a track record of creating fraudulent businesses that end up in legal troubles or bankruptcy.

According to the lawsuit, Thurston took 8.6 billion GALA tokens in February 2021, which was more than the total supply of GALA at that time. Schiermeyer says that Thurston threatened to dump his tokens if the theft was exposed, which would destroy the GALA ecosystem. To prevent this, Gala Games issued Gala v2 tokens in May 2023, which were supposed to make the stolen tokens worthless while preserving the value of the rest of the tokens. However, by then, Thurston had already sold half of his tokens on centralized exchanges for over $130 million. When Schiermeyer confronted Thurston about this, Thurston allegedly said he was buying ammunition for firearms and then stopped responding.

The lawsuit also lists several companies that Schiermeyer says were scams run by Thurston, and quotes a former associate who says that Thurston "ruined the lives of thousand[s] of young people as well as seasoned investors." The lawsuit also cites another lawsuit filed by Blox, a crypto company, against Thurston for $200 million in damages related to a deal that Thurston failed to deliver. Blox also accuses Thurston of committing fraud with the Paycheck Protection Program through his entity Block Brothers.

Schiermeyer also says that Thurston has been mostly absent from Gala Games, and was "virtually unreachable for many months at a time."