Text: Each player rolls a d6. 1-3: Take 8 damage. For each card you discard, take 1 less damage. 4-5: No effect. 6: Discard Kraken.
Set: Voyage of Peril
Group encounters like this always resolve clockwise, starting with the person who drew the card. If a 1-3 is rolled, a player will take 8 damage to their champion, unless they discard cards from their hand to lessen the amount taken. There is no limit to the number of cards that can be discarded this way.
If a player rolls a 5 or a 6, they do not take damage from the Kraken.
If somebody rolls a 6, the Kraken is discarded and the encounter ends early. This would mean that any players that were waiting to face the Kraken no longer have to, since it is now out of play.
If nobody rolls a 6, the Kraken is discarded only after every player on the table has faced it.