On August 31, Gala Games co-founders Rait Terston and Eric Shirmeier filed counterclaims in the district court of the state of Utah, alleging theft and embezzlement.
On behalf of Gala, Gala’s chief executive officer Shirmeier stated that in early 2021 Terston and his investment firm True North United Investments stole GALA tokens worth about $130 million.
According to the filing, the coins were initially moved to a company-controlled wallet, but Terston subsequently distributed them across 43 of his addresses. He himself says he kept the assets in a secure place.
Later, the defendant allegedly transferred the tokens again and swapped or sold them in a ‘complex web of tangled transactions’ from September 2022 to May 2023. It is alleged that Terston also stole the licenses to run nodes on the project’s network.
True North immediately filed a counterclaim against Shirmeier, also on behalf of Gala. The filing states that he was responsible for ‘selling and embezzling the company’s assets for millions of dollars’ and loaned corporate funds for personal use.
According to the plaintiff, Shirmeier also created Gala units in Switzerland and Dubai and became the holder of a controlling stake to ‘pursue business opportunities.’ In addition, he provided Terston with incomplete or inaccurate information and corporate records, ‘despite repeated requests’.
The suits seek the removal of the defendant from the director’s post. In addition, Terston sought $750 million from his colleague to recover losses.
In November 2022, unknown individuals released ~55.6 billion pGALA on the value up to $2.2 billion on the BNB Chain. Some of the assets were liquidated through DEX PancakeSwap, receiving over $4.5 million.
At that time, the Huobi exchange accused of ‘malicious conduct’ by the developers of the DeFi protocol pNetwork. In April, both companies filed a suit against the project.
In April 2023, Huobi and Gala Games developed a compensation plan for those affected by the incident.