Less than a year since Krafton fired the co-founders of Subnautica 2 developer Unknown Worlds, a Delaware court has ordered the three executives be reinstated. The judge ruled in favour of the ousted founders, saying that Krafton was guilty of “wrongfully usurping control” of the company.
According to Kotaku, Vice Chancellor Lori W. Will wrote in their decision that “Judgment is entered in favor of Fortis on its Phase One claims. Krafton breached the EPA [Employment Protection Act] by terminating the Key Employees without valid Cause and by improperly seizing operational control of Unknown Worlds.” The judge goes on to rule that Krafton’s board decision to fire CEO Ted Kill, co-founder Charlie Cleveland, and technical director Max McGuire be “declared ineffective to the extent it infringes on Gill’s operational control right.”
They also say that authority over Subnautica 2’s early access launch and access to Steam need to be restored.
Krafton has issued a statement to Bloomberg, saying they “respectfully disagree with today’s ruling” but they are “evaluating” their options, while also claiming that further litigation over damages is still pending.
In July last year, Krafton suddenly fired Gill, Cleveland, and McGuire. Initially, the publisher didn’t provide a reason, only saying that “nothing has changed” with their plans for Subnautica 2, nor did the fired executives, who only said on social media that the game was ready for early access release. It then emerged that Krafton had made a deal with Unknown Worlds leadership when they acquired the studio that, should Subnautica 2 ship by a certain date then they would be in line for a $250 million bonus. Krafton then accused the fired devs of abandoning their duties, Gill and the other execs filed their lawsuit, and Krafton reduced the bonus on offer to the staff that remained.
By August, Krafton issued their response to the lawsuit, claiming the fired developers had “resorted to litigation to demand a payday they haven’t earned”. They then issued a countersuit. Then, in November, as the court case approached, it came out that Krafton’s CEO, Kim Chang-han, asked ChatGPT how to not pay the ousted leadership their bonus, which he then admitted to in a pre-trial briefing.
Referring to Krafton’s claims that the developers had abandoned their duties to work on other projects, in the judge’s decision, they say that “Cleveland and McGuire had taken on limited roles, but that was long known to and accepted by Krafton.” And, as for the accusation that the fired devs downloaded and shared private company information, the judge adds that “the former employees were acting to protect the studio’s work product amid Krafton’s takeover attempt. They kept the data confidential and promptly returned it.”
It is unclear what enacting the court’s decision will look like and whether the fired developers will walk back into their roles at Unknown Worlds. Nor is it clear what this means for the release of Subnautica 2.
