Krafton has reached a settlement in its legal dispute with the former leadership team of Unknown Worlds Entertainment, the studio behind the upcoming Subnautica 2. As part of the agreement, the South Korean publisher will pay the disputed $250 million bonus. The settlement was announced alongside the resignation of the studio’s chief executive officer.

The lawsuit, filed earlier this year, centered on a performance-based bonus provision in the acquisition agreement. The former leadership team, including co-founders Charlie Cleveland and Max McGuire, claimed they were owed the sum based on the studio’s financial performance following Krafton’s acquisition of Unknown Worlds in 2021. Krafton had contested the claim, arguing that the conditions for the payout were not met.

Legal dispute and resolution

The conflict became public in early 2024 when the former executives filed a lawsuit in a California court. They alleged that Krafton had improperly withheld the bonus, which was tied to specific revenue and development milestones related to Subnautica 2. Krafton countered by stating that the targets were not achieved due to shifts in project scope and market conditions.

The settlement, announced this week, resolves all outstanding claims. Krafton has agreed to pay the full $250 million bonus to the former leadership team. In a joint statement, both parties expressed satisfaction with the resolution, noting that it allows Krafton and Unknown Worlds to focus on the development of Subnautica 2 and other projects.

Leadership change at Unknown Worlds

As part of the agreement, the CEO of Unknown Worlds has resigned. The departure is effective immediately. Krafton has appointed an interim leader from within the company to oversee the studio’s operations. The new leadership is expected to maintain continuity in the development pipeline, including the ongoing work on Subnautica 2.

No further details about the CEO’s exit have been disclosed, though sources close to the matter indicate it was a mutual decision intended to facilitate the settlement. The studio’s current workforce remains unaffected by the change.

Impact on Subnautica 2 development

Krafton has confirmed that the settlement and leadership transition will not delay the release of Subnautica 2. The game, which is currently in development, is expected to launch in late 2025. The publisher emphasized that the studio’s creative team remains intact and focused on delivering the sequel to the critically acclaimed Subnautica series.

Unknown Worlds Entertainment was founded in 2001 and gained widespread recognition for the original Subnautica, which launched in 2018. The studio’s decision to stay independent after being acquired by Krafton has been a point of interest in the gaming industry. Krafton, known for publishing PlayerUnknown’s Battlegrounds, has been expanding its portfolio of Western studios.

Looking ahead, Krafton stated that it will continue to invest in Unknown Worlds’ long-term projects. The company has not commented on whether further legal actions or disputes are expected. Industry analysts view the settlement as a sign that Krafton is prioritizing stability and forward momentum over prolonged litigation.

Source: GamesIndustry.biz