Subnautica 2’s creators sue their publisher for ‘severely’ damaging the game’s release

The battle between Subnautica 2 publisher Krafton and three former executives at its developer, Unknown Worlds, continues. Ted Gill, Charlie Cleveland, and Max McGuire — the three executives who Krafton terminated earlier this year — have filed a lawsuit detailing the alleged attempts by Krafton to torpedo the early access release of Subnautica 2 with the express purpose of avoiding paying a promised earnout bonus of $250 million.

“Krafton’s actions have already severely damaged fan anticipation and undermined the potential release of Subnautica 2,” the lawsuit says.

That earnout was promised by Krafton to the former executives and roughly 100 developers and was to be paid should Unknown Worlds hit revenue goals by the end of 2025. Subnautica 2, slated for early access release sometime in late 2025, would have all but assured those goals were met.

According to the lawsuit filed Wednesday in Delaware and published by Aftermath, Krafton also knew Subnautica 2 was on track to hit the revenue target to trigger the payout and began to take steps to essentially prevent that. The original Subnautica, an underwater survival adventure game, was a critical and commercial success, and its sequel has become the second most wishlisted game ever on Steam.

In an emailed response, Krafton PR lead Noah Kang disputed the lawsuit’s claims, saying “Krafton’s decisions were made to ensure Subnautica 2 is the best possible game and lives up to fan expectations.” You can read their statement in full below.

The lawsuit details a meeting between Krafton’s US and Korean employees concerning the marketing strategy for Subnautica 2. After that meeting, Krafton’s US employees, who worked closely with the Subnautica 2 team, reported that Krafton’s attitude about the game had changed.

“Upon their return, the El Segundo team—Krafton employees—reported to Gill that Krafton’s leadership was not focused on a successful launch, but instead on how it could convince Unknown Worlds to delay the game.”

The lawsuit additionally states that Krafton’s US employees explicitly revealed to the Unknown Worlds founders that “Krafton’s legal team was combing through the agreements looking for any opening to terminate the Founders if they proceeded with the planned release.”

The lawsuit provided the details of the deal in which Krafton purchased Unknown Worlds back in 2021. The lawsuit says that part of that deal was an agreement that the founders would maintain control of the company and the release schedule of Subnautica 2, while Krafton could not impede the game’s development nor fire Unknown Worlds’ founders without cause.

According to the lawsuit, Krafton launched a campaign to do both. Krafton allegedly failed to follow through on several of its development responsibilities for Subnautica 2, including pulling marketing and localization support. “Indeed, one of Krafton’s El Segundo publishing employees reported to Gill that Krafton Headquarters told all Krafton teams to stop all creative tasks related to Subnautica 2.”

The lawsuit claims that Krafton took these “obstructionist actions” to delay the game to avoid the $250 million payout. In a meeting between Krafton CEO Changhan Kim and Charlie Cleveland, Kim allegedly stated, “…if Unknown Worlds released the game on its planned timeline [...], it could be disastrous financially and hugely embarrassing for Krafton.” Krafton declined to comment.

After the initial story broke regarding the alleged reason for Subnautica’s delay, Bloomberg reported that Krafton agreed to extend the timeline for the earnout to account for Subnautica 2’s later release. Previously, the company denied that it delayed Subnautica 2 for any other reason but to polish the game. Earlier this week, an internal document regarding Subnautica 2’s development was leaked on Reddit. The document, consisting of two pictures taken of a computer screen, outlined the content originally planned for the game’s early access launch and how some material had to be changed or removed to meet the release date.

Krafton acknowledged the veracity of those documents, saying, “Given these circumstances, Krafton has determined that transparent communication is necessary and has chosen to confirm the authenticity of the document,” possibly to bolster its argument that Subnautica 2 was not ready for its early access release.

Noah Kang, Krafton:

Krafton’s decisions were made to ensure Subnautica 2 is the best possible game and lives up to fan expectations. Releasing the game prematurely with insufficient content, falling short of what fans expect in a sequel, would have both disappointed the players — who are at the heart of everything Krafton does — and damaged the reputations of both the Subnautica and Unknown Worlds brands. While we are disappointed that Charlie, Max, and Ted have filed a lawsuit seeking a huge payout, we look forward to defending ourselves in court. In the meantime, Krafton remains focused on what matters: delivering the best possible game as quickly as possible to Subnautica’s fans

Update, July 20th: Added statement from Krafton PR lead Noah Kang.