Krafton tried to dodge it for a year. In this story bosses won the bonus but lost the company.
Krafton agreeing to pay out the disputed $250 million Subnautica 2 bonus, after spending roughly a year in court trying to avoid exactly that, is about as clear an admission of a losing legal position as the games industry ever produces. The settlement ends a saga that began last summer, when Krafton fired Unknown Worlds CEO Ted Gill and co-founders Charlie Cleveland and Max McGuire, then delayed the game the fired trio had built. The three sued, alleging Krafton engineered those firings and the delay specifically to dodge an earnout worth up to $250 million, a bonus tied to Subnautica 2 hitting sales targets within a set window.
The litigation had already gone for Krafton before it settled. Back in March, the Delaware Court of Chancery handed down a genuinely damaging ruling, ordering Krafton not only to reinstate Gill as CEO but to extend the window for hitting the bonus milestones, which is the legal equivalent of a judge looking at your defence and handing your opponent the tools to win. That reinstatement order was a bombshell, and it flipped the whole dynamic. Once the court forced Krafton to give Gill his authority back and extended the earnout clock, the founders were suddenly positioned to actually collect, and Krafton's leverage evaporated.
The Detail That Sank Krafton's Own Case
There's a genuinely remarkable piece of this story that captures how poorly Krafton played its hand, and it involves the company's own CEO turning to a chatbot for legal strategy. Court filings revealed that Krafton chief executive Changhan Kim had consulted ChatGPT while weighing how to approach the disputed earnout, a detail that spread across gaming and mainstream outlets alike and did the company no favours whatsoever. It's the kind of revelation that undercuts a defendant's credibility in a courtroom, suggesting the decision to move against the founders may have been less a careful legal judgment than a hastily reasoned one. When the narrative around your case includes "the CEO asked an AI how to avoid paying," you've already lost the public argument, and it clearly didn't help the legal one either. Krafton had accused the founders of threatening to self-publish the game and of downloading tens of thousands of company files, allegations the trio strenuously denied while accusing Krafton of changing its story mid-litigation, and none of it stuck well enough to save the company from paying up.
The Game Made the Argument Moot Anyway
What ultimately sealed it is that Subnautica 2 simply succeeded on a scale that made Krafton's whole avoidance strategy pointless. The game launched into Early Access on May 14 and sold more than four million copies within five days, making it one of Steam's fastest-selling releases of the year and comfortably clearing the sales milestones the bonus was tied to. Once the extended earnout window met a genuine hit, the money was owed, full stop, and there was nothing left to litigate over. The irony is thick here, since the very delay Krafton allegedly imposed to dodge the bonus only pushed the launch into a window where the game triumphed anyway. Now the bonuses are being extended across the entire Unknown Worlds team, even recent hires, paid in three instalments and reportedly at significantly more than originally agreed, a goodwill gesture toward a studio Krafton badly bruised. Gill, for his part, is leaving again, this time framing it as a mutual parting and insisting "new leadership is the best way for the studio to move forward," with Krafton expected to install an external CEO. So Krafton keeps control of the studio and its hit franchise, which was arguably its real objective all along, but it paid full price to get there, both in dollars and in a year of self-inflicted reputational damage. The lasting lesson for the industry is a pointed one about earnout deals, since this whole mess is now the textbook example of what happens when a publisher tries to wriggle out of a performance bonus and the courts, and the sales charts, refuse to let it.
More:Krafton to Pivot
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