Mythical Games has filed a lawsuit against three former executives of game studio Web3 for breach of fiduciary duty while working for the company. According to the case filed Thursday, Senior Vice President Chris Ko, COO, and Chief Gaming Officer Matt Nutt, and co-founder Rudy Koch stole Mythical’s capital-raising plans and poured $150 million into their new company, Fenix Games while they were still working on the companies worked. Last year, Ko, Nutt, and Koch were tasked with finding investors for Mythical Ventures, the company’s venture capital arm. After each separately announced their exit from the company in November, executives announced that Fenix Games had raised funds from Cypher Capital, a lead investor the executives previously worked with to raise capital for Mythical Ventures to procure.
“We strongly believe in protecting our intellectual property and corporate assets”, says Nate Nesbitt, communications director at Mythical. As it is our responsibility to our employees and investors, in this circumstance, it was essential to take these steps to correct this problem and defend the company’s corporate interests. The company is suing Ko, Nutt, and Koch on 10 counts, including fraud and breach of contract. In addition, the lawsuit orders executives to return the stolen funds and seeks restrictions on their use and compensatory and punitive damages. In a Series C investment directed by Crypto VC Andreessen Horowitz last year, Mythical raised $150 million (a16z). Last month, however, the company laid off 10% of its workforce, citing the current crypto winter as a catalyst for the layoffs.