The saga continues with a lawsuit now in play, adding pressure to Krafton as questions mount over Subnautica 2’s leadership and development delays.
The conflict between Subnautica dev's fomer leadership and publisher Krafton has escalated. Co-founders Charlie Cleveland and Ted Gill have confirmed they are suing Krafton, following their removal during the early stages of Subnautica 2's development.
Cleveland and Gill break silence: “Suing a multi-billion dollar company… was not on my bucket list”
In a joint statement published on the official Unknown Worlds forums on Thursday (10 July), Cleveland and Gill confirmed they are pursuing legal action against Krafton. They claim their removal from the studio was retaliatory, stemming from their resistance to Krafton’s push for Subnautica 2 to adopt live-service elements.
“Suing a multi-billion dollar company in a painful, public and possibly protracted way was certainly not on my bucket list,” wrote Cleveland. “But the choice was taken from us.”
Gill added: “It continues to be an explosive and surreal time, and this is one of the hardest decisions we’ve ever made. But we believe it’s the right one.”They allege Krafton “unilaterally removed us from our roles” and attempted to “backdate this removal to make it seem legitimate.”
Krafton responds: “We do not take this action lightly”
Krafton has publicly denied these claims. In a statement shared with PC Gamer, the publisher said it had serious concerns about the leadership team’s direction and performance.
“We do not take this action lightly,” Krafton stated. “We remain committed to supporting the talented developers at Unknown Worlds and continuing the Subnautica legacy.” The company also emphasised that it still believes in the vision for Subnautica 2, despite reports of internal tensions and community backlash against possible monetisation changes.
Timeline of the Subnautica 2 dispute
Here is a full breakdown of events leading to the lawsuit:
- October 2024: Subnautica 2 is officially confirmed to be in development. A PC Gamer article reveals it will include co-op multiplayer and possibly live-service elements.
- 2 July 2025: Krafton appoints Steve Papoutsis (ex–Striking Distance) as the new CEO of Unknown Worlds, replacing Cleveland, Gill, and McGuire.
- 9 July 2025: Early access release, originally scheduled for 2025, is officially delayed to 2026. Krafton claims the extension is for polishing and added content, though Bloomberg noted it jeopardises the $250 million earn-out tied to 2025 performance targets.
- 10 July 2025: Cleveland and his co-founders announce they’ve filed a lawsuit against Krafton, responding to the abandonment accusations and emphasizing transparency.
Krafton insists Subnautica 2 remains in development and under steady leadership. However, the legal proceedings could complicate matters, especially if they bring previously unrevealed tensions to light.
The case also raises broader concerns about creative control in the games industry, especially when independent studios are acquired by large publishers. As this legal battle unfolds, players and developers alike will be watching closely.
