Photo: 404media.com
In an unusual legal case underscoring the potential pitfalls of relying on artificial intelligence for critical business decisions, the CEO of South Korean publisher Krafton found himself on the losing side of a court battle after implementing a strategy devised by ChatGPT. The audacious plan, aimed at circumventing a substantial $250 million bonus payment to the creators of the highly anticipated game _Subnautica 2_, was pursued despite explicit warnings from his own legal team, leading to a resounding failure.
Photo: 404media.com
A Risky Bet on Artificial Intelligence
The controversy unfolded after a judge mandated the reinstatement of a prominent video game developer who had been dismissed as part of the CEO’s AI-generated scheme. Court documents reveal that Changhan Kim, Krafton’s CEO, turned to the artificial intelligence chatbot for guidance on how to manage the studio responsible for _Subnautica 2_ and remove its founder. This move came as Krafton faced the imminent prospect of paying out a significant bonus tied to the game’s commercial success, a payment they sought to avoid.
The Quarter-Billion Dollar Incentive
The intricate details of this peculiar dispute were laid bare in a recent court ruling. Unknown Worlds Entertainment, the studio renowned for the critically acclaimed 2018 underwater survival game _Subnautica_, had been actively developing its sequel, _Subnautica 2_. Back in 2021, Krafton acquired Unknown Worlds Entertainment for $500 million, with an additional $250 million promised to the development team contingent on _Subnautica 2_’s sales performance.
As internal sales forecasts for _Subnautica 2_ indicated a strong likelihood of triggering this substantial payout, the relationship between the two entities began to strain. Fearing he had entered into an unfavorable agreement, CEO Kim bypassed traditional legal advice and consulted ChatGPT to formulate a “corporate takeover” strategy designed to avoid the $250 million obligation, according to the court’s findings. This decision ultimately led to the legal defeat and reinstatement of the developer.
