Krafton Confirms May Release Without Consulting Reinstated CEO, Triggering Contempt Motion in Subnautica 2 Case

Ted Gill's legal team filed a motion on March 20 seeking a contempt finding against Krafton after the publisher confirmed a May early access release for Subnautica 2 to multiple publications — without consulting Gill — the day after a Delaware court ruling reinstated him as CEO of Unknown Worlds and granted him full operating authority over the game's launch.

The dispute stretches back to last summer, when Krafton — which acquired Unknown Worlds in 2021 — removed Gill alongside studio founder and game director Charlie Cleveland and special projects director Max McGuire. Steve Papoutsis, CEO of Striking Distance Studios, was installed as their replacement. What followed became the Subnautica 2 lawsuit: the three founders alleged they were deliberately forced out and that the game was intentionally delayed to deny them a $250 million bonus package. Earlier coverage established through Subnautica 2 leak confirmed content cuts that Krafton had confirmed a real internal milestone review showing the early access build was missing biomes, a vehicle, a game mode, and around six hours of narrative content — shortfalls Krafton cited to justify the leadership change.

The case produced a further escalation when it emerged that Krafton's CEO had allegedly asked ChatGPT to brainstorm ways to avoid paying the bonus. Journalist Stephen Totilo at GameFile reported on the development and the subsequent legal fallout after the court ruling. This week, a Delaware judge found Krafton had breached its Equity Purchase Agreement by terminating the key employees without valid cause and by improperly seizing operational control of the studio. The board resolution that removed Gill, Cleveland, and McGuire was declared ineffective. Gill was ordered reinstated, with the explicit right to determine when and how Subnautica 2 would reach early access.

Within a day of that ruling, Papoutsis shared an internal memo announcing that Subnautica 2 had passed a key development milestone and was ready for an early access release in May. Krafton then confirmed the announcement publicly. Gill's lawyers told the judge they believed Krafton had "intentionally leaked" both the memo and the release.

"Krafton self-servingly announced the launch without any regard to its impact on the game, the team, or the community — let alone this Court's Opinion. Announcing the release of a game is momentous, and it is typically accompanied by significant marketing activity, fanfare, and community coordination. And most importantly, the announcement is carefully designed to maximise excitement for the game. That entire process was supposed to be driven by Mr. Gill. However, in defiance of the Court's Opinion, Krafton has now taken that away, further damaging the game and sowing additional confusion among the Subnautica community."

— Gill's legal team

Krafton disputed any wrongdoing. The publisher argued Papoutsis was "simply celebrating the UW employees' efforts toward a past event" — Krafton's pre-ruling determination that the game was ready — and that Gill retained the ability to independently assess the game's state and determine an appropriate release schedule. Krafton added that Papoutsis' message did not affect Gill's authority or discretion.

Gill's team was not satisfied. A follow-up motion argued Krafton continued issuing release confirmations to publications even after concerns about the memo had been formally raised with the judge, and that doing so "undermined the relief sought in this expedited phase of the litigation, in which the Founders spent nine months and millions of dollars fighting to restore their bargained-for right to determine when and how the game would launch."

I read the sequence of events here and struggle to reconcile Krafton's explanation with the timing. A publisher actively under a court ruling that explicitly named launch authority — confirming a release date publicly within hours — describing that as a routine internal celebration stretches credibility.

A separate procedural dispute now runs alongside the contempt motion. Gill's team maintains the ruling took effect at 9am Monday, placing it before Papoutsis' memo. Krafton argues it cannot take effect until a formal implementing order — still being finalized — has been signed. I find it difficult to see how that question resolves in Krafton's favor given the judge's language, but the court has not yet ruled on either matter.