Krafton CEO used ChatGPT to plot the Unknown Worlds takeover, court documents reveal

The legal battle over Subnautica 2 keeps getting stranger. According to a ruling by judge Lori W. Will, Krafton CEO Kim Chang-han turned to ChatGPT for advice on how to seize control of Unknown Worlds and push out its founders before they could collect a $250 million bonus.

The conflict stems from an acquisition agreement between Krafton and Unknown Worlds that included a substantial earnout – a bonus payout tied to hitting certain revenue targets. When internal projections showed that Subnautica 2 would easily clear that threshold, Kim concluded he had signed a bad deal.

Rather than consult corporate lawyers, the CEO of a billion-dollar company went to a language model for help finding a way to void the agreement and fire studio founders Charlie Cleveland and Max McGuire.

When ChatGPT told him the earnout would be "difficult to cancel," Kim complained to colleagues that the Unknown Worlds contract was "a contract under which we can only be dragged around." Krafton's head of corporate development, Maria Park, warned Kim over Slack that a "dismissal with cause" would not eliminate the earnout obligation and would expose Krafton to "lawsuit and reputation risk." The warning was ignored.

On the chatbot's recommendation, Kim formed an internal task force called "Project X." Its mandate was either to negotiate a reduction of the earnout with Unknown Worlds or to execute a full-on "Take Over" of the studio.

When those negotiations stalled, ChatGPT produced a "Response Strategy to a 'No-Deal' Scenario," complete with a "pressure and leverage package," an "implementation roadmap by scenario," and a "key summary of responses" for next steps. According to the ruling, Krafton followed most of those recommendations over the following month.

One of the implemented tactics was "preemptive framing" – shaping public perception before the story got out. Krafton published an open letter to its 12 million players claiming that Cleveland and McGuire would once again lead development of Subnautica 2, and that the series creators were "considering" the company's invitation.

The court found that claim to be false. The Unknown Worlds team had "nothing to do with" the message, which Krafton had posted overnight without their knowledge. Krafton also followed the chatbot's advice on "securing control points" by cutting the studio's access to its Steam publishing rights – the only way Unknown Worlds could release the game independently.

In earlier hearings, Kim acknowledged using ChatGPT, saying he wanted "faster answers to figure out what kind of rights we have." Judge Will's ruling appears to land firmly on the side of the former Unknown Worlds leadership.