On Monday, a U.S. court ordered the Korean gaming company Krafton to reinstate the Chief Executive Officer (CEO) of its subsidiary video game studio, following advice from the artificial intelligence (AI) chatbot ChatGPT.
Reuters reported that the Delaware Chancery Court directed Krafton to bring back Ted Gill, the CEO of Unknown Worlds Entertainment.
According to Vice Chancellor Lori Will’s ruling, Krafton CEO Kim Chang-Han heavily relied on ChatGPT’s guidance during a dispute with the management team of Unknown Worlds, the studio behind the Subnautica series, which Krafton had acquired.
In 2021, Krafton purchased Unknown Worlds for 500 million USD, agreeing to maintain the studio’s independence and allowing co-founders Charlie Cleveland, Max McGuire, and CEO Gill to retain control, with termination only permissible for just cause.
If the company met specific targets, Krafton was set to pay up to 250 million USD in conditional performance bonuses (earn-outs). However, as the studio prepared for the launch of Subnautica 2 last year, internal projections indicated that the conditions for the bonuses would be met.
Concerned about being caught in an unfavorable deal, Kim turned to ChatGPT for advice in June of last year. Judge Will noted in her ruling that Krafton followed most of ChatGPT’s recommendations over the subsequent month.
As suggested by the chatbot, the company attempted to negotiate a new contract and formed an internal task force to facilitate the acquisition of the studio. They also developed specific action plans, including communication strategies, securing publishing rights for Subnautica 2, and preparing systematic legal defense materials.
After failing to renegotiate the earn-outs with the studio’s management, Krafton dismissed the executives, claiming they had misled the company about their reduced working hours. Judge Will rejected this claim, extended the deadline for meeting the bonus criteria, and ordered Krafton to restore Gill’s management rights.
In a statement, Krafton expressed disagreement with the ruling and stated that it is reviewing its options while continuing to focus on delivering the best games to fans. The company added that it is working tirelessly to enhance the Subnautica sequel and prepare for its early access release.
