Anyone seen this kind of fail before?

seen a lot crack like that - usually when factory misses the key

these are both intact and uncracked, and not stretched out of round
 
This engine was a couple hundred mi into a fresh rebuild before I discovered this. Oh well! After seeing your post I now assume things were not quite right with it to begin with. Also, a good practice is to tighten that screw which holds the gear in place using a hammer and punch. Most my issues have been that screw loosening which results in a loud screeching sound from the screw in contact with the backside of the cover. All kinds of food for thought here. Thanks crassius!
http://motorbicycling.com/album.php?albumid=1645&pictureid=9717
 
I just had the exact same failure. The engine is two weeks old, but I rarely have time to ride. The small gear looks like it's made from sintered metal.
 
we've pretty much concluded that it is due to a factory worker failing to grease that gear

when you replace it, be sure to grease it properly
 
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