"Ex-Subnautica 2 Leaders Sue Krafton Over $250M Bonus Dispute"

The legal battle between the founders of *Subnautica 2* developer Unknown Worlds and South Korean publisher Krafton has escalated dramatically. Charlie Cleveland and Max McGuire, co-founders of the studio, along with former CEO Ted Gill, have officially filed a lawsuit against Krafton amid a contentious $250 million earn-out dispute.

In a recent statement, Cleveland described the ongoing turmoil as “an explosive and surreal time,” and emphasized that fans of *Subnautica 2* “deserve the full story.” This marks the latest development in a long-standing and increasingly public conflict between Unknown Worlds’ original leadership and Krafton, the global gaming giant behind *PUBG*.

Krafton acquired Unknown Worlds in October 2021, with assurances that the studio would remain operationally independent. However, tensions came to a head last week when Steve Papoutsis, former CEO of Striking Distance, was appointed as the new CEO of Unknown Worlds. In a sudden and unexpected move, the original leadership—Ted Gill, Charlie Cleveland, and Max McGuire—were removed "effective immediately." Cleveland expressed his disappointment, stating that “after all these years, to find that I’m no longer able to work at the company I started stings.”

The situation took another turn when reports surfaced that *Subnautica 2* had been delayed until 2026—just months before Krafton was expected to pay out a $250 million bonus tied to the game’s performance. According to Bloomberg, the delay was made “against the wishes of the former leadership,” and without the game launching in 2025, the revenue targets required to unlock the bonus will likely not be met.

Krafton has denied any financial motivation behind the delay, stating it was based on internal feedback and had been under discussion even before the leadership change. The publisher also claimed it had made “multiple requests” for Cleveland and McGuire to return to their roles as game director and technical director, respectively, but both declined.

“In particular, following the failure of Moonbreaker, Krafton asked Charlie to devote himself to the development of Subnautica 2. However, instead of participating in the game development, he chose to focus on a personal film project,” Krafton stated. “Krafton believes that the absence of core leadership has resulted in repeated confusion in direction and significant delays in the overall project schedule.”

Krafton further revealed that it allocated approximately 90% of the $250 million earn-out to Cleveland, McGuire, and Gill, with the remaining 10% reserved for the rest of the team. The company alleged that the trio was expected to provide active leadership in exchange for the bulk of the bonus.

Cleveland, however, has strongly denied Krafton’s claims, calling the suggestion that they wanted to “keep [the earnout] all for ourselves” completely false. He confirmed the former leadership has filed a lawsuit, though he did not specify the legal grounds. “The details should eventually become (at least mostly) public—you all deserve the full story,” he said.

He reiterated that the team believed the game was ready for Early Access and expressed frustration that it is no longer under their control. “We’d like nothing more than for you to play it—game devs live for this,” he added. “Suing a multi-billion-dollar company in a painful, public, and possibly protracted way was certainly not on my bucket list. But this needs to be made right.”

The controversy has sparked a wave of reactions from fans, with some calling for a boycott of *Subnautica 2* over what they perceive as Krafton’s questionable business practices. Others have drawn comparisons to the public fallout at Disco Elysium developer ZA/UM, where leadership disputes led to multiple factions claiming development rights to the game’s legacy.

“I don’t know who’s in the right or wrong here, but honestly, what a bizarre business decision to promise that amount of money on that premise,” one fan commented. “If Subnautica 2 wasn’t ready, it was going to be pushed out regardless just to get the money.”

“I’m honestly not sure who is in the right here. Both sides have provided pretty damning arguments,” another player suggested. “I would love to see if it's just those three asking for money or if they're including the team in their lawsuit.”

As the legal battle unfolds, the gaming community remains divided, awaiting clarity from the court proceedings. Krafton has not yet publicly responded to Cleveland’s latest statement, and IGN has reached out for further comment.