Tag: Unknown Worlds Entertainment

  • Court Supports Subnautica 2 Developers in Krafton Controversy

    Court Supports Subnautica 2 Developers in Krafton Controversy

    Key Takeaways

    1. A Delaware court reinstated the leadership of Unknown Worlds Entertainment amid a dispute with parent company Krafton regarding Subnautica 2 and a $250 million earnout agreement.
    2. The conflict began after Krafton acquired the studio in 2021 for $500 million, with accusations from founders that Krafton removed them to avoid paying the earnout.
    3. Recent court documents revealed that Krafton’s CEO explored ways to bypass the earnout, including consulting ChatGPT and forming an internal team named “Project X.”
    4. Krafton claimed their actions were due to project readiness and alleged mismanagement, while also stating the founders attempted to erase evidence.
    5. The court ruled Krafton violated key parts of the acquisition agreement, reinstating leadership and extending the earnout period into 2026-2027.

    A Delaware court has decided to bring back the leadership at Unknown Worlds Entertainment. This is a significant moment in the ongoing clash with parent company Krafton regarding Subnautica 2 and a $250 million earnout agreement.

    Background of the Case

    The dispute arose after Krafton acquired the studio in 2021 for $500 million, which included an extra payment linked to how well the sequel performs. In mid-2025, the founders accused Krafton of removing them and delaying the game’s release to avoid paying that bonus. “Krafton has disregarded its commitments just for profit,” the lawsuit claimed back then.

    New Developments

    Recent court documents provide more detail on these accusations. They reveal that CEO Changhan Kim looked into ways to sidestep the earnout, even consulting ChatGPT and creating an internal team dubbed “Project X.” This plan included options to renegotiate the payout or take over the studio completely. Some internal messages hinted that a takeover might be the “simpler” option.

    Earlier court filings also mentioned talks about lowering proposed payouts, along with internal warnings from Krafton about the legal dangers of dismissing the leadership.

    Krafton’s Position

    Krafton argued that the decision was based on project readiness and alleged mismanagement. The company also claimed that the founders tried to erase important evidence. Additionally, Krafton stated they had proposed extending the earnout period under new conditions.

    The court has now ruled that Krafton violated crucial parts of the acquisition agreement, ordering that the leadership be reinstated and extending the earnout period into 2026-2027.

    Subnautica 2 is still on track for a 2026 release, with both lawsuits continuing to unfold.

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  • Krafton Uses AI to Deny $250M Payout to Subnautica 2 Devs

    Krafton Uses AI to Deny $250M Payout to Subnautica 2 Devs

    Key Takeaways

    1. Krafton acquired Unknown Worlds Entertainment (UWE) for $500 million, with an additional $250 million bonus contingent on sales targets for Subnautica 2.
    2. Following the acquisition, Krafton fired UWE’s founders and postponed Subnautica 2’s release to 2026, which helped them avoid paying the bonus.
    3. UWE founders allege that Krafton sought legal advice from ChatGPT to find ways to evade the bonus payment and planned a “Project X” to take control of UWE.
    4. Internal communications revealed Krafton discussing renegotiation offers and considering a takeover instead of fulfilling the original agreement.
    5. Both the lawsuit from UWE’s founders and Krafton’s counter-suit regarding mismanagement and theft are ongoing, while Subnautica 2’s release date remains set for early 2026.

    Back in July, court papers released by Charlie Cleveland, one of the three co-founders of Unknown Worlds Entertainment (UWE), showed some fascinating details about the lawsuit against the South Korean publishing giant, Krafton. The documents contained shocking accusations regarding the publisher’s conduct during the time leading up to the lawsuit. The lawsuit claimed, “Krafton has tossed its promises aside for the sake of profit, taking the game from the hands of its creators and community.”

    Acquisition and Bonuses

    When Krafton purchased UWE for a whopping $500 million in October 2021, they also agreed to pay the founders an extra $250 million if certain sales targets were achieved, particularly for Subnautica 2. In late 2024, UWE announced the early access release date for Subnautica 2 would be in 2025. However, just six months later, Krafton fired the founders and soon after postponed the launch to 2026, claiming that various aspects of the game required more work from the remaining UWE and Krafton teams. This delay also meant they could avoid paying the previously arranged bonus.

    Legal Tactics and Internal Discussions

    Interestingly, after announcing a shift toward becoming an AI-focused company, the founders allege in their new filing that Krafton consulted ChatGPT for legal strategies to dodge the bonus payment. The filing stated, “Krafton dismissed the Founders and took control of Unknown Worlds to escape the earnout.” It continued, “Documents show that Krafton was exploring ways to ‘cancel the earn-out’ and that their secret ‘Project X’ aimed to either negotiate a ‘Deal’ regarding the earnout or execute a ‘Take over.’ When the Founders refused to meet Krafton’s terms about the earnout, Krafton deemed a ‘take over’ the easier option.”

    Renegotiation Offers and Current Status

    Leaked internal communications reveal Krafton’s discussions regarding offers to renegotiate payments. Richard (Sang-Han) Yoon’s texts were quoted, saying, “I had a call earlier. They’re asking for 75 million for themselves and 40 million for their team members … They insist on negotiating the team packages together,” Yoon added. “Right now, we’re considering a bucket of around 10 million for the team,” he concluded. “It might just be simpler to take over.”

    Chang Han Kim replied, “Set a date and send a letter if you need to send it early.”

    The release date for Subnautica 2 remains set for early 2026, even as both the founders’ lawsuit and Krafton’s counter-suit—accusing mismanagement, theft of files, and sharing confidential information, among other issues—are still unresolved.

    Krafton has since responded to Eurogamer, stating:

    “This assertion is merely a diversion from their own attempts to destroy evidence, such as Charlie reminding other Key Employees (Max and Ted) to erase anything ‘incriminating’ from their ChatGPT accounts. Contrary to Fortis’s claims, Krafton proposed extending the earnout period if the Key Employees returned to their contractually obligated positions.”

     

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  • Unknown Worlds Sues Founders Amid Krafton Lawsuit Saga

    Unknown Worlds Sues Founders Amid Krafton Lawsuit Saga

    Key Takeaways

    1. Unknown Worlds Entertainment is suing its co-founders for neglecting their roles and misusing sensitive company information.
    2. The lawsuit, filed on August 15, 2025, claims the founders’ disengagement harmed the development of Subnautica 2 and its release was rushed for financial gain.
    3. Accusations include the founders neglecting their responsibilities and causing significant delays in the game’s development.
    4. The founders are also accused of stealing confidential data before leaving the company, with large file downloads noted just before their access was cut off.
    5. The legal action follows the founders’ termination on July 1, 2025, after Krafton’s acquisition of Unknown Worlds in 2021.

    The team behind Subnautica, Unknown Worlds Entertainment, is taking legal action against its co-founders, Charlie Cleveland, Ted Gill, and Max McGuire. They claim that the founders neglected their roles, misused sensitive company information, and rushed the launch of Subnautica 2 for a big payout.

    Details of the Lawsuit

    The lawsuit spans 74 pages and was submitted to the Delaware Court of Chancery on August 15, 2025. It details how the founders’ disengagement negatively impacted the development of Subnautica 2 and jeopardized the integrity of the game series.

    This legal action occurs after the trio was let go on July 1, 2025, and is linked to Krafton’s acquisition of Unknown Worlds in 2021 for $500 million. There was also a possible additional $250 million if the studio met certain revenue goals by 2025.

    Allegations Against the Founders

    The lawsuit states that McGuire, Gill, and Cleveland were entitled to 90% of the $250 million, with their bonuses connected to the game’s successful development and release. However, their actions reportedly caused delays and limited progress.

    Further accusations in the suit claim that the executives “largely neglected” their responsibilities as creative and technical leads. Cleveland, for example, turned his attention to filmmaking by 2023, changing his LinkedIn to reflect a “part-time” status. By 2024, he had completely stepped down from all creative leadership roles, with internal complaints citing a lack of direction as early as 2022.

    Gill is criticized for not addressing the total abandonment of leadership in both creative and technical aspects, allowing the studio to drift aimlessly while knowing the ongoing problems at Unknown Worlds.

    Project Shifts and Delays

    It has been reported that McGuire focused on his passion project, Moonbreaker, a turn-based digital miniatures game that ultimately did not succeed commercially in February 2024. He ceased all technical participation in Subnautica 2.

    Due to their alleged actions, the development of Subnautica 2 fell years behind schedule. Internal reviews by Krafton in 2025 described the game’s current builds as “unready” and lacking essential gameplay features. Consequently, the game faced three delays, and its scope was downgraded from a fully-prepared Early Access to merely a digital sandbox.

    Misappropriation of Data

    In addition to these claims, Unknown Worlds accuses the founders of stealing confidential information as they departed from the studio. Between early June and July 2025, McGuire reportedly downloaded almost 100,000 files, including many related to Moonbreaker, while Cleveland downloaded about 72,000 files just eight minutes before his access was cut off.

    Gill had exported his entire company email account two times, which triggered alerts from the IT department. These downloads were the largest undertaken by each of the three founders since at least 2022.

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  • Subnautica 2 Dev Vlog Reveals Co-op Gameplay Ahead of Early Access

    Subnautica 2 Dev Vlog Reveals Co-op Gameplay Ahead of Early Access

    Key Takeaways

    1. Subnautica 2 is set in a new alien environment, building on lessons learned from the first game.
    2. The sequel will introduce co-op gameplay, allowing players to explore together.
    3. Early access for Subnautica 2 is expected to begin later in 2025, with player feedback encouraged during development.
    4. The game will feature new biomes, vehicles, crafting options, and leviathans.
    5. Early Access duration is anticipated to last around two to three years, with publishing managed by KRAFTON.

    Subnautica was created and released by Unknown Worlds Entertainment in 2018, and the game has received overwhelmingly positive feedback on Steam. It quickly gained popularity after its release, and fans have been eagerly awaiting a follow-up, which was officially announced last October. Recently, a new developer vlog called ‘Road to early access’ appeared on their YouTube channel, inviting fans to contribute to the game’s improvement as it prepares for early access later this year.

    New World and Gameplay

    In the video, Design Lead Anthony Gallegos reveals that Subnautica 2 takes place in a completely new and mysterious alien environment. He mentions that the team has utilized all the lessons they learned from the first game to enhance the sequel. One exciting addition is the introduction of co-op gameplay, which was missing in the original title. The vlog features scenes of two players exploring the underwater world together and assisting one another.

    Early Access Timeline

    According to Gallegos, the early access period for Subnautica 2 will begin “later in 2025.” During this phase, players can provide feedback while the game is still being developed. They will be able to explore various biomes and encounter new vehicles, crafting options, and leviathans. Although a specific release date for early access hasn’t been confirmed yet, this marks the first update since the teaser that was released in October 2024.

    The Steam page for Subnautica 2 mentions that while it is “difficult to accurately predict how long Early Access will last,” based on past experiences with Early Access titles from Unknown Worlds Entertainment, the team anticipates a duration of around two to three years. Additionally, unlike the original game from 2018, the sequel will have its publishing managed by KRAFTON.

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