As part of the ongoing legal battle between publisher Krafton and the co-founder trio of Subnautica developer Unknown Worlds, Ted Gill, Charlie Cleveland and Max McGuire, new details have come to light. According to WCCFTech, the testimonies of the three co-founders from a trial back in November in the Delaware Court of Chancery have been used by Krafton as part of its evidence.
The testimonies, according to Krafton, show that the publisher had no plan to remove the co-founders from their leadership position at the studio to avoid giving them their earnout. The company said that it became “unequivocally clear there was no preconceived plan by Krafton to remove Unknown Worlds’ leadership to avoid the earnout obligation,” from their testimonies.
Along with this, the publisher has further alleged that the testimonies by McGuire, Cleveland and Gill serve as evidence that they “lied and tried to hide their abandonment [of Subnautica 2 and their duties] because they wanted Krafton to pay them hundreds of millions of dollars for nothing.”
As part of its legal strategy, Krafton has been establishing a timeline of events where Cleveland and McGuire hid the fact that they weren’t as hands-on with ongoing work at Unknown Worlds during the studio’s acquisition negotiations with Krafton. The publisher itself reportedly only discovered this on May 20 this year.
According to excerpts of the testimonies, Cleveland said, “I stopped working four months ago and have entered semi-retirement,” on January 8, 2024, in a private message. Another statement attributed to McGuire was also shown, where he said in an email to the core team members at the Subnautica developer that “I’ve continued to do bits and pieces of the job as needed, but I stopped using that title years ago when I felt it no longer reflected my primary contribution to the company.” In this statement, McGuire was referring to his title of technical director and had reportedly sent this email back on January 10, 2024.
McGuire made another statement on April 29, 2024, noting that he spoke to Cleveland and Gill about leaving the company. To this, Cleveland responded by saying that he was “pretty sure [he’ll] be doing the same thing.”
Another key piece of evidence provided by Krafton is a statement by Subnautica 2 lead designer Anthony Gallegos, who noted that he found it difficult to get any feedback on the title’s progress from McGuire. He said that he “can’t even get [McGuire] to look at some code for [Subnautica 2] water to help us, but he’ll make money off a sale from four years ago and get paid to do nothing.”
As part of the trial, Cleveland even admitted that he had not informed Krafton CEO Changham Kim about his lack of involvement at Unknown Worlds. Krafton’s side of the legal battle asked him: “You stood to gain potentially tens of millions of dollars more in earnout, and you couldn’t send him [Changham Kim] an email because your arms were hurting? Is that your testimony?” To this, Cleveland responded, “That’s not a great reason, I admit.”
Gill has also been further implicated by a statement from the transcription of an audio call made on June 10, 2025. In this statement, Gill told Krafton that the publisher should pay the promised earnout if it plans to delay the release of Subnautica 2.
“If you [Krafton] want to delay the game, just pay it. Just pay the earnout…agree to pay it now. We can sign something tomorrow…it’ll be paid, and we’ll give you flexibility on paying it. You can pay it over two years, instead of all at once. But just pay it,” said Gill as per the statement.
These statements by Krafton have been part of the company’s legal strategy of providing evidence that the three co-founders “were always concerned first and foremost about the earnout,” rather than the health of the studio and its future game releases.
Just last month, the trio had accused Kim of using ChatGPT to try to figure out a way how Krafton could avoid paying the promised earnout to Gill, Cleveland and McGuire.
