KRAFTON has become embroiled in a lawsuit valued at 344.7 billion won in the United States. KRAFTON announced on the 24th that it was sued in a local court by former executives of the American game development company Unknown Worlds, which it acquired in May 2021 for $500 million (about 580 billion won).
KRAFTON stated, "The former executives, who failed to fulfill their responsibilities, filed the lawsuit to pursue personal financial gains," adding, "We will clarify the facts and assign accountability."
In its announcement, KRAFTON revealed that Fortis Advisors, LLC, the former shareholder representative of Unknown Worlds Entertainment, filed a lawsuit on the 10th in the U.S. Delaware Court of Chancery for contract enforcement and damages.
The claims include "earn-out payments based on the stock purchase agreement and other damages proven in court," "a mandatory injunction to fulfill obligations under the stock purchase agreement," "a judgment in favor of the plaintiff on all claims," and "all litigation costs, other expenses, and pre- and post-judgment interest to be borne by the defendant." The total claim for damages amounts to approximately 344.775 billion won.
Earlier, Charlie Cleveland, a founding member of Unknown Worlds and the former chief executive officer (CEO), wrote on Reddit and X, "Together with co-founders Ted Gill and Max McGuire, we filed a lawsuit against KRAFTON."
Unknown Worlds is the game company that created the popular ocean adventure game "Subnautica," which has sold over 6 million copies worldwide. KRAFTON is reportedly committed to developing and releasing the sequel "Subnautica 2" by the end of this year, and has stated that it would pay performance bonuses (earn-out) worth approximately $250 million (around 340 billion won) to executives and employees if certain revenue targets are achieved following the release.
However, recently KRAFTON postponed the release of "Subnautica 2" to next year due to concerns about its quality and fired the executives, sparking controversy. The former executives claim, "KRAFTON dismissed us to evade performance bonus payments."
KRAFTON expressed disappointment that "the plaintiffs filed this lawsuit to pursue personal financial gains," but welcomed the opportunity to clarify the facts. It added, "This legal process provides a chance to protect the company and fans, clarify the facts, and assign accountability."
It continued, "We are doing our best to provide a high-quality game and will focus on development responsibly so that this lawsuit does not affect that process."