CEO Ted Gill returns to oversee Subnautica 2’s development following his recent removal.

A nine-month dispute between publisher KRAFTON and the key figures behind Subnautica 2’s development team, Unknown Worlds, has finally reached a resolution.

A judge has now ruled that KRAFTON must reinstate the CEO of Unknown Worlds, Ted Gill, who was abruptly fired in July last year alongside co-founders Charlie Cleveland and Max McGuire. The court has ordered that his operational authority and decision-making over Subnautica 2 be fully restored.

According to Kotaku, the court stated:

“Krafton breached the EPA by terminating the Key Employees without valid cause and by improperly seizing operational control of Unknown Worlds. As a result, the July 1, 2025 Board resolution that saw Gill and others dismissed from the company is declared ineffective to the extent it infringes on Gill’s operational control rights.”

The studio will also remain eligible for the US$250 million bonus payout, as the court has extended the earn-out period until September 2026.

KRAFTON has responded in a statement to PC Gamer, “While we respectfully disagree with today’s ruling, we are evaluating our options as we determine our path forward. Today’s ruling does not resolve the former executives’ claim for damages or an earnout related to Subnautica 2, with further litigation still pending. In the meantime, Krafton’s immediate focus remains unchanged: delivering the best possible game to Subnautica’s fans.”

A messy dispute between Subnautica 2 developers and KRAFTON

The Subnautica 2 devs and KRAFTON conflict began in July 2025, when KRAFTON abruptly fired CEO Ted Gill and co-founders Charlie Cleveland and Max McGuire, while also delaying Subnautica 2’s Early Access release to 2026–a year later than originally planned. Speculation quickly arose that the moves were financially motivated.

Reports suggested that KRAFTON deliberately delayed production, insisting the game was not ready for publishing despite the developers’ claims to the contrary. It was alleged that the publisher aimed to avoid paying the $250 million earn-out bonus stipulated in the 2021 acquisition deal–now confirmed by findings from the court. The contract stated that if Subnautica 2 met specific revenue and release targets by the end of 2025, KRAFTON would be obliged to award the bonus.

The dispute drew further attention after reports revealed that KRAFTON’s CEO consulted ChatGPT for strategies to avoid paying the payout, sparking additional outrage.

Soon after their removal, the CEO and co-founders filed a lawsuit in Delaware’s Court of Chancery, alleging breach of contract and claiming that the game had been intentionally delayed to prevent the bonus eligibility.

Nearly nine months later, the court ordered the reinstatement of CEO Ted Gill and extended the bonus payout window, marking a victory for the original development team.

Subnautica 2 now appears back on track for release. The game is one of the most anticipated and wishlisted titles on Steam, and will serve as the third installment in the critically acclaimed Subnautica series.