Time for your weekly helping of legal Subnaughtiness. Subnautica developers Unknown Worlds are suing recently departed director Charlie Cleveland, CEO Ted Gill, and studio co-founder Max McGuire for, amongst other things, stealing a bunch of game design files shortly before they were fired.
Or at least, an external legal firm acting on behalf of Unknown Worlds have filed suit. The firm in question – Richards, Layton, and Finger – are also representing parent company Krafton as they defend themselves against an earlier lawsuit brought by Cleveland, Gill and McGuire, who are accusing Krafton of dismissing them unfairly and delaying Subnautica 2’s release to avoid paying out a timed $250 million bonus.
Krafton 100% own Unknown Worlds, and are Subnautica 2’s publisher. So why isn’t this lawsuit coming from them? As PCGamer’s Andy Chalk suggests, the suspicion is that the lawyers have picked Unknown Worlds as plaintiff, rather than Krafton, because they think they’ll get more sympathy that way from Johnny Average Gamer. After all, everybody knows publishers are stinkheads.
A Krafton spokesperson has justified the situation as follows to Chalk: “While Krafton is the parent company, the contracts, intellectual property and confidential information at issue belong to Unknown Worlds. The defendants were executive leadership at Unknown Worlds, and their obligations, including confidentiality and fiduciary duties, were owed to that entity.”
The lawsuit itself broadly reiterates Krafton’s earlier claims that the three banished executives shirked their responsibilities toward Subnautica 2, and that they were only pushing to get the game released this year for the sake of that $250 million bonus (Cleveland, McGuire and Gill stood to receive 90% of it personally, but claim they planned to distribute most of their earnings to the rest of the Unknown Worlds team).
The document is full of redacted bits, excerpts from internal correspondence, and a bunch of screencaps from Reddit that are offered up as evidence that regular Subnautica players think the departed studio executives are at fault. Congratulations, redditor Plebius-Maximus – when they turn all this into a movie, you are probably going to be played by Justin Timberlake.
Cleveland is accused of being first to “stray” by leaving video game development in 2023 to “learn how to produce movies and explore other interests”. The lawyers say that by 2024, he had abandoned “all creative or other leadership roles with the Company”. As for McGuire, he’s said to have “spent 2022 and 2023 buried in the passion project of a new game, Moonbreaker, even well past the time that it became clear that Moonbreaker was a commercial failure”. The lawsuit accuses Gill, the CEO, of doing nothing about these “functional departures from game development of leadership”. It alleges that development “stalled” as a result, resulting in projected release date delays and a “degraded” project scope.
With regard to the much-ballyhooed $250 million “earnout”, the lawsuit accuses the three of trying to “publish whatever they could under the Subnautica 2 name on a timeline” that would ensure they received the money, despite the game falling “far short of the Company’s internally-set expectations for the early access release”. It claims that when Krafton rejected their proposals, the three executives threatened to self-publish Subnautica 2. It was this conversation, the lawsuit claims, that led to Unknown Worlds terminating their employment.
That much, we’ve approximately heard before. But the accusations of stealing documents from the company are new. On June 2nd and June 30th- shortly before he was fired – Gill allegedly exported his entire Unknown Worlds email account, triggering an IT alert. McGuire is said to have downloaded 99,902 company files shortly before his own termination, including documents from Moonbreaker’s development. Cleveland supposedly “downloaded 72,140 Company files” between June 26th and his termination on 1st July, only to be interrupted when Unknown Worlds cut off his access to the system in the course of his firing.
When the mass downloading of files was reported, Unknown Worlds apparently sent a cease & desist letter to the three, demanding that they return any confidential info in their possession. According to the lawsuit, the fired executives at first refused, and then proposed to delete files rather than turn over their devices for inspection. The lawsuit alleges that Gill, Cleveland and McGuire are both using this confidential information in their lawsuit against Krafton, and have also “improperly used or disclosed Confidential Information to members of the press”.
It’s not clear what this last part refers to, but it could be the internal Subnautica 2 planning document that appeared online in July. Krafton were happy to confirm that as authentic, which is understandable given that the document’s mention of stripped-out features supports their case for delaying the game.
You can read all 74 pages of the redacted Unknown Worlds lawsuit on Scribd. All of this is going to chug along for a while longer, I expect. For the moment, I will close by noting that the lawyers accuse Gill, Cleveland and McGuire of carrying out a “trifecta of mischief”, which is a magic phrase and also, sounds like the title of a Bond film. Perhaps they should cast Idris Elba as Plebius-Maximus – on reflection, I’m not sure Timberlake has the starpower for something this high octane. He can play Johnny Average Gamer instead.
