The world of Web3 gaming startup Gala Games has become embroiled in a legal feud, with significant allegations of corporate wrongdoing surfacing. Gala Games CEO and Co-founder, Eric Schiermeyer, is facing a lawsuit filed by True North United Investments LLC, representing Blockchain Game Partners (BGP), Inc., and investors in Gala Games. The complaint, filed last Thursday, accuses Schiermeyer of "corporate waste, conversion, and unjust enrichment," and calls for his removal as a director and president of BGP.
Allegations of Underhanded Actions
The lawsuit paints a concerning picture of Schiermeyer's actions within the company, alleging a series of underhanded schemes and questionable dealings conducted without the knowledge or approval of shareholders. These alleged actions include:
Directing BGP to burn $600 million in tokens.
Using BGP funds for personal purposes, including loans worth millions of dollars made to himself.
Establishing entities in Switzerland and Dubai, positioning himself as the controlling shareholder.
Keeping Wright Thurston, True North's manager and BGP director, in the dark with incomplete and inaccurate financial information, and refusing to provide complete financial records.
Serious Damage and Threats to Shareholders
The complaint asserts that Schiermeyer's ongoing actions have inflicted serious damage to BGP and continue to pose a threat. Furthermore, it claims that these actions have harmed the rights and interests of True North and various other minority shareholders, both under the Founders Agreement and as a result of True North's 44.762% ownership stake in BGP.
Litigation Landscape
The lawsuit was filed in Utah, with Salt Lake City identified as the intended venue for the legal battle. True North United Investments LLC, the plaintiff, comprises various trusts, including WWT Legacy Trust, SMT Legacy Trust, FRT Legacy Trust, TMT Legacy Trust, WJT Legacy Trust, TBT Legacy Trust, AMT Legacy Trust, and NET Legacy Trust.
It's important to note that Schiermeyer also filed a lawsuit on August 31, accusing True North and Thurston of misappropriating 8,645,014,077 GALA tokens in 2021, further escalating the legal conflict within Gala Games.
Conclusion
The legal dispute surrounding #GalaGames and its CEO, Eric Schiermeyer, raises significant questions about corporate governance and financial transparency within the company. As the legal battle unfolds, it may have far-reaching consequences for Gala Games, its investors, and the broader Web3 gaming community. The crypto world will undoubtedly closely monitor the developments and outcomes of these lawsuits.
