Krafton is being forced to bring back a recently fired CEO after the game publisher was caught using ChatGPT to find ways to avoid paying previously promised performance bonuses.

It turns out, you shouldn’t be using AI for very sensitive legal advice. Krafton CEO Changhan Kim found this out the hard way when he used ChatGPT to figure out how to cut costs at the publisher’s recently acquired studio, Unknown Worlds.

Krafton’s Continued AI Use Gets Messy

PUBG publisher Krafton has a pretty long history with AI. And it’s not just in its games – it’s in the office, which has actually caused more trouble for the company.

In September 2025, Kim announced: “Starting today, Krafton will automate its work around Agentic AI, and its members will fully develop an AI-centric management system that focuses on creative activities and solving complex problems.”

The overall goal was to become an “AI-first” company, including in-game services made with AI, and also to use AI in their workflow. Krafton claimed AI would save them time and money, allowing them to make more games with the savings.

In November 2025, the gaming community caught wind of an internal notice that outlined a “Voluntary Separation Option Program.” Basically, employees who don’t want to participate in Krafton’s AI-focused future plans can volunteer to leave the company. These employees would receive 36 months of pay.

That same month, Unknown Worlds – the studio behind Subnautica 2 – accused Kim of using ChatGPT to find out ways to avoid paying a $250 million bonus they were previously promised if Subnautica 2 hit certain sales milestones.

Krafton Must Hire Back Unknown Worlds CEO, Extend Time Period For Bonus

Krafton purchased Unknown Worlds in 2021. The initial plan was to have the studio operate independently while it continued working on Subnautica 2. As part of the purchase, Krafton had promised the studio $250 million based on Subnautica 2’s performance and sales.

It soon came to light that Kim had used ChatGPT to figure out how to avoid paying that bonus. One tactic was to delay the launch of Subnautica 2 and limit where it would be sold. This was an alleged attempt to miss certain release milestones.

During this time, the three founders were fired from Unknown Worlds. Krafton claimed this was due to the CEOs “abandoning” the game. In response to the firing and delays, Charles Cleveland, Adam “Max” McGuire, and Edward “Ted” Gills decided to sue Krafton.

One part of the lawsuit reads: “Smoking gun documents show that Krafton was looking for ways to ‘cancel the earn-out’ and that its secret ‘Project X’ was designed to either make a ‘Deal’ on the earnout or execute a ‘Take over.’”

The lawsuit then mentions using ChatGPT to brainstorm ways to avoid the bonus. This was part of Project X. Apparently, even ChatGPT had said it would be “difficult” to cancel this bonus.

Krafton denied the allegations and even claimed it was “forced” to fire the co-founders because of their lack of interest in Subnautica 2. The claim continues that the plaintiffs want jobs restored despite not doing them or having any interest in them.

On March 16th, 2026, a Delaware judge ruled that Krafton had to reinstate one of its fired CEOs, Ted Gill. While only Gill was forced to be rehired, the court added that he could rehire Cleveland and McGuire if he wanted to.

“Judgment is entered in favor of Fortis [which represents the Unknown Worlds founders] on its Phase One claims,” wrote Vice Chancellor Lori W. Will for the decision handed down in the Delaware Chancery Court on March 16. “Krafton breached the EPA by terminating the Key Employees without valid Cause and by improperly seizing operational control of Unknown Worlds.”

Due to this extreme disruption, the judge also extended the time period that the team has to earn the $250 million bonus. The bonus can be collected through September 15th, 2026.

Krafton is still denying any real wrongdoing. It said to Kotaku: “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.”