Wearables & Gadgets

ZeniMax wins Oculus lawsuit and is awarded half a billion dollar judgment

The Oculus-ZeniMax lawsuit has taken an interesting turn.

A Dallas, Texas jury today awarded ZeniMax half a billion dollars after finding that Palmer Luckey, one of the company’s co-founders, as well as Oculus in general, failed to comply with terms stemming from the video game publisher’s non-disclosure agreement, according to Polygon.

The Jury did however, rule that Oculus did not misappropriate trade secrets during E3 meetings when the Rift was first revealed, a fact ZeniMax adamantly claims in the suit.

The half a billion dollar judgment breaks down like this: Oculus is paying out $200 million USD for breaking the NDA and $50 million for copyright infringement. Oculus and Luckey each have to pay an additional $50 million for false designation, and Brendan Irbe, one of Oculus’ other co-founders, will pay out $150 million.

The jury’s decision was revealed Wednesday afternoon after two and a half days of deliberation. Both Oculus’ Luckey and id Software co-founder John Carmack, were present in the courtroom when the verdict was read.

In ZeniMax attorney Anthony Sammi’s closing statement, the lawyer called the incident a “heist” and argued that ZeniMax should be awarded $2 billion in compensation, as well as an additional $4 billion in punitive damages, making the lawsuit’s total a massive $6 billion.

On the other side of the suit, Beth Wilkinson, Oculus’ attorney, stated that the lawsuit was driven by ZeniMax’s embarrassment regarding not taking Carmack’s technical developments and interest in the virtual reality field seriously, as well as an overall “jealousy and anger,” according to reporting stemming from Polygon.

During the trial Luckey was accused of not having the technical know-how to create the Oculus Rift, suggesting that Carmack did the bulk of the development on the industry changing high-end virtual reality headset. During the trial Luckey’s origin story regarding the Rift was described as a “fanciful” tale. At one point in the Rift’s development, Carmack was working at both ZeniMax and Oculus in various capacities.

The ZeniMax-Oculus trial began in early January and saw testimony from various high-profile tech figures involved in the case, including Facebook CEO and founder Mark Zuckerberg. Carmack also stood accused of copying code from iD software computers before leaving the company to work for Facebook, a fact he confirmed, though he also stated that the code did not contribute to the development of the Rift.

Oculus, which was purchased by Facebook following a landmark $2 billion acquisition of the company back in 2014, claims that the allegations in the lawsuit are a result of ZeniMax seeking “quick payout.”

Facebook is expected to announce its fourth-quarter earnings later today. In an interesting move, ZeniMax has announced the acquisition of Escalation Studios, a video game developer that specializes in the virtual reality space.

ZeniMax owns Bethesda Softworks, the publisher behind Skyrim and Fallout series, as well as id Software, the studio that created the iconic Doom franchise.

Update 02/01/17: An Oculus spokesperson reached out to MobileSyrup with the following statement.

“The heart of this case was about whether Oculus stole ZeniMax’s trade secrets, and the jury found decisively in our favor. We’re obviously disappointed by a few other aspects of today’s verdict, but we are undeterred. Oculus products are built with Oculus technology. Our commitment to the long-term success of VR remains the same, and the entire team will continue the work they’ve done since day one – developing VR technology that will transform the way people interact and communicate.  We look forward to filing our appeal and eventually putting this litigation behind us.”

Via: Polygon