AI-Led Oust Reversed: Krafton Ordered to Reinstate Game Studio Head

A Delaware judge ruled that Krafton Inc must reinstate the head of its acquired game studio, Unknown Worlds Entertainment. Krafton had improperly removed the studio leadership under the advice of AI tool ChatGPT during a takeover plan. The conflict arose from a $250 million earnout controversy.

A Delaware judge mandated the reinstatement of the head of Unknown Worlds Entertainment, a game studio owned by Krafton Inc. The ruling came after the South Korean game developer, following AI suggestions from ChatGPT, removed the leadership improperly as part of a takeover strategy.

The $250 million dispute between Krafton and the leaders of Unknown Worlds, creators of the popular 'Subnautica' game series, centered on an earnout agreement post-acquisition. Krafton's actions were influenced by concerns that the agreement was skewed unfavorably, prompting them to seek ChatGPT's advice.

The court's decision reinforced the original terms, ensuring that CEO Ted Gill and his team regain operational control, while extending the criteria period to meet the earnout. Krafton is now reviewing the ruling, as it continues to focus on developing the 'Subnautica' sequel.

(With inputs from agencies.)