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

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

Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.

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.

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.

Gala Games Co-Founders Sue Each Other Alleging Corporate Waste, $130 Million Theft – Decrypt

— FinTech Whale (@FinTechWhale) September 4, 2023

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.

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.

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.

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.

SEC accuses Utah firm of ‘fraudulent’ $18M crypto mining scheme
The United States Securities and Exchange Commission said Green United’s operation was a fraud, with the community quick to quell fears of the SEC classing crypto mining as a security. pic.twitter.com/cLPVDVyaPj

— Mr Legend Crypto (@mrlegendcrypto) March 7, 2023

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.

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.

President of World Bank Group, Islamic Development Bank, African Development Bank, Asian Development Bank, European Bank for Reconstruction and Development, Inter-American Development Bank respectively.

Al-Madani - Kuroda - Mirow - Moreno - Zoellick

EconomyWatch Contributor

Following a career as a photographer and video producer, Alice began working in financial services as an IFA in 2007. She began her career as an investment writer and financial journalist in 2009, working for a number of top financial institutions while obtaining extensive expertise writing for a range of industries and audiences. Alice went to St Andrews University to study English and Russian.

Alice Briggs

EconomyWatch Contributor

Argentina’s Energy Secretary in 2002, and subsequently its World Bank representative. Alieto Guadagni has a doctorate in economics from the University of Chile. In 1991 he undertook the role of undersecretary of Production for Defense in the Ministry of Defense in Argentina, and consequently became secretary of International Economic Relations of the Ministry of Foreign Relations. In 1993, Guadagni was appointed an official ambassador of Brazil. He has worked as a consultant for international organisations such as the Inter-American Development Bank (IDB), the World Bank, the Organization of American States, and the United Nations, in addition to being a researcher at the Universidad Torcuato Di Tella.

Alieto Guadagni

EconomyWatch Contributor

Founding members of Columbia University’s Center on Capitalism and Society. Amar Bhide is a Visiting Professor at Harvard Business School, currently teaching ‘Lessons from Transformational Medical Advances’. Edmund Strother Phelps (born July 26, 1933) is an economist who won the Nobel Memorial Prize in Economic Sciences in 2006.

Amar Bhide and Edmund Phelps

EconomyWatch Contributor

Amy Griffin enjoys writing about social media, other marketing strategies, and finance. Some of her best-known work includes educational content related to finance and economics.

Amy Griffin

EconomyWatch Contributor

Chief Economist at NGP Energy Capital Management Dr. Anas F. Alhajji is a Managing Partner of Energy Outlook Advisors and was previously the Chief Economist at NGP Energy Capital Management. He was in charge of the firm’s macro-analysis of the oil, natural gas, and associated markets, as well as the general economy. Dr. Anas F. Alhajji is a leading expert on the energy markets, and has published over 900 papers, articles, and columns.

Anas F. Alhajji

EconomyWatch Contributor

Senior fellow at the Peterson Institute for International Economics. Adjunct professor at Georgetown University. Per Anders Aslund is a Swedish economist and a Senior Fellow at the Atlantic Council. Additionally, he is the chairman of the International Advisory Council at the Center for Social and Economic Research. From 2003 Aslund was the director of the Russian and Eurasian Program at the Carnegie Endowment for International Peace. His work mainly focuses on the economic transition from centrally planned to market economies. Anders Aslund has been dubbed by David Frum as ‘one of the world’s leading experts on the collapse of the planned Soviet economy.’

Anders Åslund

VoxEU.org

Andrea Edwards has worked in marketing and communications all over the globe for 20 years, and is now focused on her passion – writing. A gifted communicator, strategist, writer and avid blogger, Andrea is Managing Director of SAJE, a digital communications agency, and The Writers Shop – a regional collaboration between the best business writers in Asia Pacific

Andrea Edwards

EconomyWatch Contributor