KRAFTON Accused of Sabotaging Subnautica 2 to Delay Release and Evade $250 Million Bonus to Unknown Worlds [Updated]

KRAFTON has issued a statement addressing the ongoing lawsuit with Unknown Worlds, the development team behind Subnautica 2. The company emphasized that premature release of the game could disappoint fans, saying, “Releasing the game prematurely with insufficient content, falling short of what fans expect in a sequel, would have disappointed the players – who are at the heart of everything KRAFTON does – and damaged the reputations of both the Subnautica and Unknown Worlds brands.”Furthermore, KRAFTON expressed confidence in their legal position, asserting they “look[ed] forward to defending ourselves in court.”

Background on the Legal Dispute

The conflict between KRAFTON and Unknown Worlds has escalated significantly, as detailed in a recently unsealed lawsuit by Unknown Worlds’ co-founders—Charlie Cleveland, Max McGuire, and Ted Gill. This lawsuit reveals the reasons behind their claims against KRAFTON for breach of contract.

For those needing a recap of previous events, a summary list detailing the developments in this situation is available. The complete lawsuit document is also accessible here for those interested.

Context of the Acquisition

In 2021, KRAFTON acquired Unknown Worlds for a substantial sum of $500 million, with an additional $250 million potential bonus contingent on revenue targets being met by the end of 2025. The co-founders and their 40-member team were entitled to a portion of this bonus, with plans to distribute it among the members not officially included.

However, tensions grew when KRAFTON recognized that an early access launch of Subnautica 2 by year’s end could allow Unknown Worlds to surpass those revenue goals, thereby unlocking the bonus payment.

CEO’s Allegations and Delay Tactics

The lawsuit highlights a troubling admission from KRAFTON’s CEO, Changhan Kim, who allegedly expressed concerns about the financial ramifications of launching Subnautica 2 in early access. Kim purportedly stated that such a move could be “disastrous financially and hugely embarrassing for KRAFTON.”The company, however, now contests this claim, attributing it to a misunderstanding by translators, despite this not being a previous issue.

The lawsuit claims that KRAFTON engaged in sustained efforts to postpone Subnautica 2’s release. It accuses KRAFTON of withdrawing key marketing support, failing to uphold vital partnerships, and neglecting critical pre-launch responsibilities. Reports from KRAFTON employees suggested these actions were aimed at impeding the earnout agreement.

Termination of the Co-Founders

Despite facing these obstacles, members of Unknown Worlds took initiative to manage their responsibilities, leading up to a pivotal moment on July 2 when the co-founders were terminated. The lawsuit argues this move was a blatant contractual violation, stating, “In flagrant disregard of the parties’ contract, KRAFTON terminated without cause three former owners of Unknown Worlds – Charles Cleveland, Adam ‘Max’ McGuire, and Edward ‘Ted’ Gill – and seized control of the company. KRAFTON’s first decision upon taking over? To delay the launch of Subnautica 2 until sometime in 2026, allowing it to retain game revenue and avoid the $250 million earnout.”

Rebuttal Against KRAFTON’s Claims

The suit counters KRAFTON’s assertions that the co-founders had “abandoned”their duties at Unknown Worlds, clarifying that they were, in fact, working on a Subnautica film—a project that KRAFTON had requested them to pursue. Additionally, KRAFTON’s claim that Subnautica 2 was unprepared for early access has come under scrutiny. Leaked milestone reviews imply the game lacked content, prompting a delay to 2026 based on player feedback from internal testing.

The co-founders argue that the so-called ‘experts’ hired by KRAFTON to assess the game’s readiness lacked relevant experience, disputing KRAFTON’s conclusions about the player feedback which they contend indicated the game was ready for launch.

Summary of Breach of Contract Allegations

Ultimately, the co-founders’ lawsuit accuses KRAFTON of violating not only the letter but also the spirit of their agreement. They point out that KRAFTON failed to uphold promises related to operational control, consultation prior to harmful actions, refraining from actions counter to the earnout objectives, and terminating the founding members without cause. The document proclaims, “In the name of its bottom line, KRAFTON has thrown its promises out the window and ripped the game from the hands of both its creators and its community.”

KRAFTON now faces the challenge of responding to these serious allegations, and updates regarding this ongoing legal battle will be provided as new information comes to light.

Source & Images