• Schiermeyer accuses Thurston of diverting 8.6 billion GALA tokens and selling them without company knowledge

• Gala Games’ response includes the introduction of Gala v2 Tokens and Thurston’s Involvement in Legal Disputes.

A legal conflict is unfolding within the Gala Games ecosystem as the project’s co-founders, Eric Schiermeyer and Wright Thurston, have taken each other to court over allegations of financial misconduct. The claim asserts that Thurston wrongfully diverted 8.6 billion GALA tokens in early 2021, selling them for $130 million without the company’s knowledge.

Schiermeyer filed his lawsuit on August 31st. In response, Thurston has also filed a lawsuit against Schiermeyer, alleging that he took control of the company and used its funds for personal purposes, such as purchasing a private jet.

Gala Games, a startup in the Web3 gaming sector, was founded in early 2019 by Thurston and Schiermeyer, each holding an equal 50 percent share. Interestingly, the third co-founder, Michael McCarthy, is not mentioned in either of the lawsuits. Recently, the company introduced Champions Arena, a turn-based mobile game, and ventured into blockchain-based music, film, and digital collectibles.

Schiermeyer’s lawsuit alleges that Thurston has founded multiple companies, many embroiled in legal disputes, bankruptcy, and financial difficulties, including lawsuits filed by the SEC. Schiermeyer emphasizes that Gala Games is the only entity with a clean record, and his primary accusation is that Thurston misappropriated 8.6 billion GALA tokens in February 2021, representing over 100 percent of the circulating GALA tokens at that time. Schiermeyer asserts that exposing this fraud would have severely harmed the GALA ecosystem.

Gala Games’ Response: Introduction of Gala v2 Tokens

In May 2023, Gala Games responded by introducing Gala v2 tokens, marketing them as a modified version. They promoted these tokens as featuring enhanced burning mechanisms, improved security measures, and advanced scalability. Schiermeyer publicly stated that the primary purpose of these tokens was to render the tokens in Thurston’s wallets obsolete while not adversely affecting the rest of the ecosystem.

As the lawsuit states, Thurston reportedly held nearly half of his tokens on centralized exchanges during the scaling process. The allegation is that Thurston sold these tokens for a profit exceeding $130 million. When confronted by Schiermeyer, Thurston initially claimed he was buying ammunition for firearms but eventually withdrew from communication. 

Thurston’s Involvement in MLM Companies and Additional Companies

The lawsuit also mentions involvement in multiple MLM companies that negatively affected numerous investors. Another lawsuit filed by Blox against Thurston alleges he caused $200 million worth of equipment damage without addressing the issue. Thurston is also facing allegations of involvement in a Paycheck Program fraud case.

Thurston’s lawsuit accuses Schiermeyer of excluding him from the company’s operations and holding him responsible for Gala Games’ overall decline and the substantial losses it incurred.

According to data, GALA has experienced an 8 percent price drop over the last 24 hours, making it the cryptocurrency with the most significant decrease. The negative sentiment surrounding the blockchain gaming platform and the lawsuits filed by the co-founders against each other caused the decrease in value.

In different legal actions involving Thurston, the SEC initiated a lawsuit against his founding company, Green United, accusing it of deceiving investors by encouraging them to invest $18 million in a fraudulent cryptocurrency enterprise.

According to the SEC, a promoter for the company, Kristoffer A. Krohn, promoted the idea of purchasing miners and nodes backed by the ERC-20 GREEN token, even though no GREEN token existed. Both defendants filed separate appeals to dismiss the SEC lawsuit, arguing it lacks the necessary jurisdiction.