While delivering goods to Phandalin, the party encountered the dead horses of Gundren Rockseeker and Sildar Hallwinter. They defeated a group of ambushing goblins, sparing one named Grug. The party forced Grug to lead them to the hideout of the Cragmaw goblins, where they instigated a civil war between goblins loyal to the bugbear Klarg and those loyal to the goblin Yeemik. The party slew the majority of the goblins, Klarg, his pet wolf, and Yeemik. They rescued Sildar and retrieved a load of supplies belonging to the Lionshield Coster.