There's a lesson here for anyone tempted to use an AI chatbot for corporate strategy: the email trail usually survives. A Delaware judge found Krafton's CEO used ChatGPT to engineer the removal of Unknown Worlds Entertainment CEO Ted Gill from the company to dodge a $250 million bonus payout.
The gaming publisher's attempt to sidestep a significant financial obligation has ended exactly as you'd expect when a company leaves documented evidence of deliberate malfeasance. After nine months of legal wrangling, a judge ordered that Ted Gill be reinstated and that control over the game's early access release schedule be returned to him, whilst also extending the $250 million earnout period to at least September 15, 2026.
Here's what actually happened. In 2021, Krafton acquired Unknown Worlds Entertainment for $500 million, and as part of the deal, agreed to pay an additional $250 million earn-out bonus if the studio's sequel Subnautica 2 hit certain sales targets. Everything seemed straightforward until Krafton's own sales projections showed Subnautica 2 was on track to trigger that payout. When Krafton's head of corporate development warned that a dismissal without cause would expose the company to "lawsuit and reputation risk," CEO Changhan Kim looked to ChatGPT for guidance.
The chatbot advised forming an internal task force to renegotiate the earnout or force a studio takeover, controlling the game's publishing rights, framing the conflict as being about "fan trust" and "quality" rather than money, and even suggested drafting a public-facing message to win over Subnautica fans, which Kim then asked ChatGPT to write. The strategy backfired spectacularly, alarming the gaming community and heightening suspicions that something was deeply wrong at the studio.
The company fired Gill alongside co-founders Charlie Cleveland and Max McGuire in July 2025. Krafton's initial excuse was that they'd planned to release the game prematurely. When that claim fell apart under scrutiny, the company pivoted to arguing that Cleveland and McGuire had secretly gone semi-retired and that all three founders had improperly downloaded company data before being terminated. The judge rejected both claims, writing that "Krafton's newly manufactured justifications for the terminations are pretextual." The court found Cleveland and McGuire's limited roles were "long known to and accepted by Krafton" and that the founders "were acting to protect the studio's work product amid Krafton's takeover attempt, kept the data confidential and promptly returned it."
The ruling stung more than a dismissed case. The judge found that "Krafton breached the EPA (Equity Purchase Agreement) by terminating the key employees without valid cause and by improperly seizing operational control of Unknown Worlds." Even more awkward: The judge acknowledged that putting Gill back in charge "will cause tension with the parent company given the obvious bad blood between the parties" but said that "does not excuse a material breach of contract" or override the performance clause both parties had agreed to.
Now comes the complaint that prompted the original GameSpot article. After Gill was reinstated by court order, Krafton announced a specific release date for Subnautica 2's early access without consulting him. Co-founder Charlie Cleveland commented: "It's been a tough eight months for Unknown Worlds and the Subnautica community. But today, we've been vindicated!" The legal team representing Gill and the founders filed a motion claiming Krafton's announcement, made without their input, potentially damaged the game and caused confusion among fans.
There's still unfinished business. The ruling does not resolve the former executives' claim for damages or an earnout related to Subnautica 2, with further litigation still pending. One day after the judge's ruling, Unknown Worlds announced that Subnautica 2 will launch on early access at some point in May.
The broader business lesson is straightforward: when you sign a contract with a $250 million performance bonus, courts will take it seriously. Attempting to manufacture grounds to fire executives whilst leaving a paper trail of chatbot conversations about how to dodge the payout isn't clever corporate strategy; it's a blueprint for loss.