Unknown Worlds Takes Legal Action Against Former Subnautica 2 Leadership Over Confidential Files

The ongoing drama surrounding Subnautica 2 has escalated once again. On August 15, 2025, developer Unknown Worlds officially filed a lawsuit against its recently ousted leadership team, accusing them of downloading and retaining thousands of confidential company files shortly before their removal in July.

This lawsuit comes only weeks after those same former leaders — Charlie Cleveland, Max McGuire, and Ted Gill — filed their own legal action against Krafton, the publisher and parent company of Unknown Worlds. In that case, the trio alleged that Krafton deliberately delayed Subnautica 2’s early access release to 2026 in order to avoid paying the development team a $250 million bonus payout tied to early access milestones in 2025.

Background: Leadership Shake-Up at Unknown Worlds

On July 2, 2025, Krafton abruptly terminated Subnautica 2’s three-person leadership team without prior warning. Soon after, the publisher installed industry veteran Steve Papoutsis as CEO of Unknown Worlds. Papoutsis is well known in the gaming industry for his work as senior and executive producer on the Dead Space franchise, as well as for leading Striking Distance Studios, another Krafton subsidiary, during the development of The Callisto Protocol.

The removal of Cleveland, McGuire, and Gill marked a major turning point for the studio. Each had been closely associated with the Subnautica franchise since its inception, and their departure sent shockwaves through both the development team and the game’s community.

Unknown Worlds’ Allegations Against Its Former Leaders

According to the newly filed lawsuit in Delaware court, Unknown Worlds accuses its ex-leadership team of “absconding” with more than 170,000 confidential files just before their dismissal. The filing, which has been partially redacted but corroborated by multiple industry outlets, claims these files included intellectual property, business plans, and sensitive company data.

Specifically, the lawsuit details that:

• Max McGuire allegedly downloaded 99,902 files shortly before his termination.

• Charlie Cleveland is said to have downloaded 72,140 files, halting activity only eight minutes before being locked out of the system.

• The scale of the downloads represented the largest bulk access by leadership since at least 2022, raising serious red flags within the company.

Unknown Worlds argues that these actions could compromise not only the development of Subnautica 2 but also the studio’s competitive advantage and intellectual property portfolio.

The Counter-Suit Against Krafton

Meanwhile, the ousted leaders maintain their own lawsuit against Krafton, claiming the publisher acted in bad faith by delaying Subnautica 2’s early access launch to 2026. Their suit argues that this delay was a calculated move to deny the development team eligibility for a substantial bonus payout tied to early access success in 2025.

According to the former leadership, had Subnautica 2 entered early access on schedule, the team could have unlocked up to $250 million in bonuses, funds that would have been distributed across the studio. By pushing the release into the following year, Krafton effectively nullified those terms.

What Happens Next?

At this point, the situation has developed into a complex legal battle with both sides filing claims against each other. Unknown Worlds is seeking to protect its data and intellectual property, while the ousted leaders are pursuing financial damages over the alleged contract breach tied to bonuses.

Industry observers note that the litigation could drag on for years, potentially impacting the development roadmap for Subnautica 2. Fans who have been eagerly awaiting the sequel — originally announced for a 2025 early access release — may now face further uncertainty about when the game will actually arrive.

For now, the future of Subnautica 2 hangs in the balance, caught between corporate disputes, allegations of misconduct, and a leadership shake-up that has dramatically altered the trajectory of one of gaming’s most beloved survival franchises.