Krafton Sued for Over 300 Billion KRW by Founding Members of U.S. Subsidiary Unknown Worlds

Development Delay and Dismissal Conflict Over "Subnautica 2"
Former Subsidiary Executives Demand $250 Million

On July 24, Krafton announced in a public disclosure that it has been sued in a local court by the former shareholder representative of Unknown Worlds, its U.S.-based subsidiary and the developer of the marine adventure game "Subnautica."

Krafton Pangyo Headquarters. Photo by Krafton

The company stated, "The applicant filed this lawsuit against us in the Delaware Court of Chancery," adding, "The claimed damages amount to approximately 344.775 billion KRW." This figure is the Korean won equivalent of the maximum possible earn-out payment of 250 million USD stipulated in the stock purchase agreement.

The claims include the earn-out under the stock purchase agreement, additional damages proven in court, and an order to enforce obligations under the stock purchase agreement. Krafton explained, "We plan to actively respond to the plaintiff's claims through legal counsel in accordance with legal procedures."

Previously, Charlie Cleveland, a founding member and former CEO of Unknown Worlds, stated on the English-language online community Reddit that he, along with co-founders Ted Gill and Max McGuire, filed a lawsuit against Krafton.

Unknown Worlds is a U.S.-based game development studio that Krafton acquired for 500 million USD in 2021. The studio gained significant international popularity with its 2018 hit title "Subnautica" and is currently developing its sequel, "Subnautica 2."

However, as the development of this game was delayed, Krafton, after a period of conflict, abruptly dismissed Charlie Cleveland and other founding members earlier this month, which ultimately escalated into an international legal dispute.

A Krafton representative commented, "We are disappointed that the plaintiffs have filed this lawsuit for their own personal financial gain," but also stated, "Through this legal process, we will protect the company and our fans, clarify the facts, and ensure that responsibility is clearly determined."