Gala Games’ Founders Sues Each Other Over Corporate Waste and Embezzlement

Jimmy Aki
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Gala Games co-founders Wright Thurston and Eric Schiermeyer have filed lawsuits against each other in a Utah District Court. Schiermeyer’s suit alleged that Thurston misappropriated $130 million worth of GALA tokens, while the latter accused him of corporate mismanagement.

Gala Founders at Loggerheads

On August 31, Eric Schiermeyer filed a lawsuit claiming that in early 2021, Wright Thurston unlawfully took approximately 8.6 billion GALA tokens in cryptocurrencies.

These tokens were taken through his company, True North United Investments, which holds around 45% of Gala Games. GALA serves as the primary utility token within the Gala Games ecosystem, a product developed by the company.

The legal complaint alleged that when confronted about the theft of GALA tokens belonging to the company, Thurston falsely asserted that his intention was merely to secure the GALA in wallets for the benefit of Gala Games.

However, over the course of a complex series of transactions between September 2022 and May 2023, Thurston and/or True North began moving the stolen tokens from these wallets, exchanging or selling them.

Approximately $130,000,000 worth of the stolen GALA was exchanged, concealed, or sold before Gala Games could intervene.

The lawsuit further contends that Thurston also appropriated licenses to operate “nodes” within the Gala ecosystem from the company.

These nodes are valuable as they allow the operator to earn GALA tokens. Thurston purportedly sold these stolen node licenses to others, retaining the proceeds for himself and/or True North.

Schiermeyer’s legal action also accused Thurston of a consistent pattern of founding companies that ultimately became insolvent, bankrupt, or embroiled in legal disputes.

The filing noted that Gala Games seems to be the sole legitimate enterprise in which Thurston is involved despite having no role in its day-to-day operations.

Ironically, despite Schiermeyer’s diligent management of the company, Thurston has allegedly paid himself more through theft. As per the filing, this is ten times more than the compensation Schiermeyer received from the company.

Thurston Files a Countersuit

In a countersuit filed on the same day, Wright Thurston claimed that Schiermeyer assumed control of the Gala Games for personal gain, including using company funds for personal expenses such as financing a private jet.

Thurston acknowledged his lack of involvement in the company’s operations but asserted that Schiermeyer’s actions have deprived him of any input into Gala Games’ direction for the benefit of the company and its shareholders.

Thurston’s lawsuit further alleged that Schiermeyer’s misconduct, mismanagement, and self-interest have substantially damaged Gala’s reputation, company assets, and shareholder interests.

According to Thurston’s filing, Schiermeyer allegedly established Gala entities in Switzerland and Dubai, positioning himself as the dominant shareholder to pursue business ventures.

Schiermeyer’s lawsuit requested Thurston’s removal as a Gala director and seeks various forms of relief and damages, including the return of the allegedly stolen Gala tokens.

Similarly, Thurston is seeking Schiermeyer’s removal from Gala, alleging that Schiermeyer misappropriated a minimum of $600 million from the company’s funds and is pursuing at least $750 million in damages and relief.

Gala Games

The announcement has significantly impacted GALA’s price, with the token plummeting by more than 14.50% in the past week and currently trading at $0.016.

Thurston’s Troubles

On March 8, 2023, Thurston faced legal action from the United States Securities and Exchange Commission (SEC) concerning a separate venture he initiated, Green United LLC.

The SEC claimed that Green United deceived investors by persuading them to invest $18 million in a fraudulent green cryptocurrency project.

According to the regulatory body, Green United and a promoter named Kristoffer A. Krohn deceived investors by assuring them about buying miners and nodes. These miners and nodes were supposedly linked to a “public global decentralized power grid” powered by the ERC-20 GREEN token.

However, the SEC alleged that the GREEN token didn’t exist and that Thurston’s hardware, which was sold to investors, was a Bitcoin mining rig with no functionality. The SEC contends that the distribution of GREEN tokens wasn’t a result of mining but rather was at Thurston’s discretion.

Nevertheless, Thurston and Schiermeyer filed a motion to dismiss the SEC’s lawsuit in May, arguing that the agency lacked jurisdiction to oversee digital asset cases.

About Jimmy Aki PRO INVESTOR

Based in the UK, Jimmy is an economic researcher with outstanding hands-on and heads-on experience in Macroeconomic finance analysis, forecasting and planning. He has honed his skills having worked cross-continental as a finance analyst, which gives him inter-cultural experience. He currently has a strong passion for regulation and macroeconomic trends as it allows him peek under the global bonnet to see how the world works.