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Jury Orders Oculus To Pay $500 Million In ZeniMax Lawsuit (polygon.com)

An anonymous reader quotes a report from Polygon: A Dallas, Texas jury today awarded half a billion dollars to ZeniMax after finding that Oculus co-founder Palmer Luckey, and by extension Oculus, failed to comply with a non-disclosure agreement he signed. In awarding ZeniMax $500 million, the jury also said that Oculus did not misappropriate trade secrets as contended by ZeniMax. Of the $500 million, Oculus is paying out $200 million for breaking the NDA and $50 million for copyright infringement. Oculus and Luckey each have to pay $50 million for false designation. And Iribe has to pay $150 million for the same, final count. The decision came back Wednesday afternoon following two and a half days of deliberation in the case being tried in a United States District court in the North District of Texas. Both id Software co-founder John Carmack and Oculus co-founder Palmer Luckey were in the courtroom when the verdict was read. During closing arguments, ZeniMax attorney Anthony Sammi called the incident a heist and argued that ZeniMax should be awarded $2 billion in compensation and another $2 billion in punitive damages. Oculus attorney Beth Wilkinson argued that the multibillion-dollar lawsuit was driven by ZeniMax's embarrassment, jealousy and anger, not facts. It remains unclear what sort of impact this will have on the daily retail sale of the Oculus Rift headsets.

77 comments

  1. Facebook's status by Anonymous Coward · · Score: 5, Funny

    [X] Rekt
    [ ] Not rekt

    We'll see what happens on appeal, and what this means to companies that poach employees in the future.

    1. Re:Facebook's status by Anonymous Coward · · Score: 0

      Zuckerberg will clean out the loose change from under his car seat and make this go bye-bye.

    2. Re:Facebook's status by Anonymous Coward · · Score: 1

      wtf is a rekt

    3. Re:Facebook's status by Anonymous Coward · · Score: 0

      wtf is a rekt

      Me.. when your mom comes over.

    4. Re:Facebook's status by D00MSlayer · · Score: 1

      We're going to need a burn unit over here!

    5. Re:Facebook's status by Anonymous Coward · · Score: 0

      wtf is a burn?

    6. Re:Facebook's status by Anonymous Coward · · Score: 0

      It's what your dad needs preparation-h for after a date with D00MSlayer.

    7. Re:Facebook's status by Anonymous Coward · · Score: 0

      [X] Rekt
      [ ] Not rekt

      [ ] [SARCASM] Rekt

  2. Impact? by PCM2 · · Score: 2

    It remains unclear what sort of impact this will have on the daily retail sale of the Oculus Rift headsets.

    Probably none -- at least, not until after Oculus' appeal is heard.

    --
    Breakfast served all day!
    1. Re:Impact? by Anonymous Coward · · Score: 0

      Not even then. Facebook can suck up the charges, they have money.

    2. Re:Impact? by guruevi · · Score: 2

      They probably didn't absorb the company though, they kept it separate from Facebook. Oculus the company is worth $2B but I highly doubt they have even 5% of that value in assets, if nothing else they just have loads of debt and a bunch of imaginary property worth $2B. If such judgment gets held up, Oculus will be forced into bankruptcy.

      --
      Custom electronics and digital signage for your business: www.evcircuits.com
    3. Re:Impact? by PoopJuggler · · Score: 1

      They probably got paid almost entirely in FB stock (I'm guessing), which should be quite liquid.

    4. Re:Impact? by guruevi · · Score: 1

      The owners/stakeholders/debtors got paid 2B by facepoop to sell the company to them. Doesn't mean the company owns $2B in stocks because that wouldn't be a sale.

      --
      Custom electronics and digital signage for your business: www.evcircuits.com
  3. FWIW, this is why you read employment contracts. by kbonin · · Score: 4, Informative

    I used to work for Bethesda, a ZeniMax company. Never seen a more legally aggressive employment agreement, I had to reject initial offer until they added an addendum. Without it was essentially a multi-year multi-industry no-compete phrased to get around state laws banning no-compete clauses...

  4. VERY UN-AMERICAN JUDGE by DonaId+Trump · · Score: 0, Troll

    How is Palmer supposed to pay for all my Russian shills now? This verdict is SAD and the judge is a LOSER!

    1. Re:VERY UN-AMERICAN JUDGE by Anonymous Coward · · Score: 0

      haha perfect!

  5. Muddy waters by fluffernutter · · Score: 4, Interesting

    This is a case of a smart person being dumb. If you want technology to be yours, you don't let it touch any machine owned by another company and you do it all on your own time. How a person could muddy the waters like this when the stakes are so high is beyond me.

    --
    Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
    1. Re:Muddy waters by Anonymous Coward · · Score: 0

      Then you know more than the rest of us about his contract since anti-compete clauses take care of copyrights in a way that it won't be yours even if it is on your machine with all original code which in itself is hard to do if you work at a company that produces code and done on your own time.

    2. Re:Muddy waters by Anonymous Coward · · Score: 0

      Many employment agreements claim ideas you have that are related to business conducted by your employer regardless of where you had the idea or if you ever even wrote it down. Mentioned it to someone in passing - evidence in court. The "I didn't use company resources or time" argument isn't even close to valid in such cases.

      Unfortunately, many people don't read their employment agreements that closely when taking the job and find themselves in tricky situations as a result.

    3. Re:Muddy waters by fluffernutter · · Score: 1

      Yet has any anti-complete ever been successful of winning such a broad claim? They can write anything they want in a contract, doesn't mean it is enforceable. Why tempt fate by using company equipment.

      --
      Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
    4. Re:Muddy waters by fluffernutter · · Score: 1

      And for heaven's sake, don't TALK about it at work.

      --
      Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
  6. In Your Face! by Anonymous Coward · · Score: 0

    FaceFuck!

  7. North District of Texas...? by edi_guy · · Score: 3, Insightful

    Zenimax is in MD, Oculus in CA...yet the trial is in the North District of Texas...? I've been around Slashdot long enough to understand why there are so many trials like this in the "North District of Texas" but it's still baloney that lawyers can shop the district they want to file in. I for one would like my criminal trial to be held in the state which is most lenient to whatever my crime is....

    1. Re:North District of Texas...? by Anonymous Coward · · Score: 1

      The Eastern District of Texas is the patent troll haven. This case was in Dallas, not Texarkana or Tyler.

    2. Re: North District of Texas...? by Anonymous Coward · · Score: 0

      ID is in Dallas

    3. Re:North District of Texas...? by Cajun+Hell · · Score: 2

      You're thinking of East Texas. But I do think it's funny that the mere act of an IP-related trial happening somewhere in Texas, is enough to give the whole thing the stench of illegitimacy. It's funny because it's true.

      Congress should burn that (East Texas) court to the ground and re-instate it somewhere else, just to try to repair the reputation. I'm not saying they can't still have it be corrupt and biased, just that they need to shake it off because it's gotten to the point where everyone knows something is wrong.

      --
      "Believe me!" -- Donald Trump
    4. Re:North District of Texas...? by Anonymous Coward · · Score: 0

      Nope, id Software is headquartered in Texas. They're the ZeniMax subsidiary that Carmack left.

    5. Re:North District of Texas...? by PingSpike · · Score: 1

      Would it be possible to write into all your contracts that none of your products could be used in the east district of Texas to avoid this? I suppose even if it was they'd just go up the chain to the next most terrible district.

  8. This is why you hire a lawyer by Anonymous Coward · · Score: 0

    "The jury also said that Oculus did not misappropriate trade secrets as contended by ZeniMax."

    Sounds like the Jury thought poaching John Carmack was legal. If Oculus had just been more patient, listened to a good lawyer, and done more VR experiments to legally cover their ass, and used open source games, such as Quake 3, they could have walked away without paying anyone.

    Maybe the court of appeals will knock down the Oculus payments.

    1. Re:This is why you hire a lawyer by sexconker · · Score: 1

      No, that wasn't about hiring Carmack away, that was about the code he took with him.

      The jury didn't feel it was proven that the code Carmack took with him was related to VR shit that he then used at Oculus.
      But of course it fucking was. That's likely why the amounts are so huge for the NDA shit the jury agreed was absolutely proven.

    2. Re:This is why you hire a lawyer by Anonymous Coward · · Score: 0

      The jury didn't feel it was proven that the code Carmack took with him was related to VR shit that he then used at Oculus. But of course it fucking was.

      What was the code Carmack took with him? If you're so sure it was related to VR stuff he then used at Oculus then you must know what it is.

    3. Re:This is why you hire a lawyer by Anonymous Coward · · Score: 0

      It's interesting that if you go back to the SoftDisk days, Carmack originally developed Commander Keen using SoftDisk's computers, even though the games were sold under id software's name. IIRC they did agree to publish some games for SoftDisk to compensate them. But anyway Carmack could probably recall the entire set of code he wrote from memory, so a NDA violation is all they are going to get since proving IP theft would be impossible in this case.

      This is all pretty much nonsense - VR is going to disappear the same way 3D films and TVs will. It's a gimmick and gets boring quickly.

    4. Re:This is why you hire a lawyer by citizenr · · Score: 2

      The code Carmack tool was for Doom 3. You know, the very same code HE personally wrote, owned, and released under GPL before selling ID Software.

      --
      Who logs in to gdm? Not I, said the duck.
  9. Re: Trump Administration Survival List by Anonymous Coward · · Score: 0

    you left out internet,
    you ignorant slob!

  10. false designation? by rikkitikki · · Score: 1

    Forgive my legal ignorance (IANAL :), what does 'false designation' mean?

    1. Re:false designation? by guruevi · · Score: 4, Informative

      It's when you sell stuff and lie about its origin. E.g. If stuff comes from China, you can't just say it's "Made in US".

      --
      Custom electronics and digital signage for your business: www.evcircuits.com
    2. Re:false designation? by null+etc. · · Score: 2

      If stuff comes from China, you can't just say it's "Made in US".

      Not yet, but give Trump a few days.

    3. Re:false designation? by Anonymous Coward · · Score: 0

      Or maybe when you say you developed something that was developed by another company.

  11. Re:Dear zenimax by Anonymous Coward · · Score: 0

    Why?

  12. Re: Trump Administration Survival List by Anonymous Coward · · Score: 0

    It was written with the assumption there would be no infrastructure. You could add networking gear and cabling if you wanted to set up some type of ad-hoc intranet with your neighbors. Some of the smaller switches run off a 12V wall-wart so would be suitable for emergency power systems.

  13. Way to go, Carmack by Anonymous Coward · · Score: 0

    Hopefully no one will be dumb enough to work with Carmack again after this fiasco.

    1. Re:Way to go, Carmack by Anonymous Coward · · Score: 0

      Douchebag alert. So, by definition Carmack could not change jobs, and work in his field of speciality.

  14. Re:Trump Administration Survival List by Anonymous Coward · · Score: 0

    OK. I'll bite.

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  15. Re:FWIW, this is why you read employment contracts by Anonymous Coward · · Score: 0

    Why should we listen to anything you say? You're the one responsible for the bucket on head bug in Skyrim.

  16. Re:Trump Administration Survival List by ColdWetDog · · Score: 1

    You're all messed up and wrong:

    10 kilograms zip ties
    25 kilogram duct tape (various colors)
    100 kg Doritos
    500 kg coffee beans
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    Spare laptop
    Porn as desired
    Reruns of Firefly, Red Dwarf, Alien

    Am I missing something?

    --
    Faster! Faster! Faster would be better!
  17. Re: Trump Administration Survival List by Anonymous Coward · · Score: 0

    Slashdotter-specific addendum

    37. 6TB of porn
    38. Mom, to do laundry
    38. A girlfriend (maybe get two, since world is ending)
    39. Nunchucks for self-defense

  18. Re: Trump Administration Survival List by Anonymous Coward · · Score: 0

    You forgot throwing stars.

  19. or... by JustNiz · · Score: 1

    Of course Oculus isn't going to just hand over $500M to Zenimax, there will probably be a battle of attrition costing both decades of expensive legal appeals until the first one cracks.

    Of course Zuckerberg has the resources to do the above, but that would be expensive (although not as expensive as $500M). It seems to me a far more cost-effective alternative would be to have Oculus sell its VR tech to Facebook, then just let Oculus collapse and go bust, taking its 500M debts and poor management team with it. After that, Zuck could just start a whole new VR company with the VR tech he already bought. Hell he could even hire many of the same people back. If bet if he called the new company Occulus (i.e. not Oculus), I bet hardly anyone would even notice anything changed.

    1. Re: or... by Anonymous Coward · · Score: 0

      Fraudulent conveyance.

    2. Re:or... by keltor · · Score: 1

      You would have to do this BEFORE you got sued for this not to be "actually illegal" and honestly then you'd just go back and amend the claim to sue the assets as well.

    3. Re:or... by JustNiz · · Score: 1

      Not true. Theres no legal requirement that one company _has_ to bail out another (even if they own the failing company). Zuk could easily let the comapny go bust. It would also be seen as reasonable that Oculus had to sell their tech in order to meet their new financial obligations.

  20. Re: Trump Administration Survival List by Anonymous Coward · · Score: 0

    40. You'll want stuff to run a large garden: seeds, gardening tools, fertilizer, fencing, etc.
    41. If you can only have one type of animal, chickens are probably the best choice. Goats would be a close second.
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    47. Composting toilet or septic tank system.
    48. Windmills or micro-hydro to augment the solar setup.

  21. Re:Trump Administration Survival List by Anonymous Coward · · Score: 0

    Please add to this list as you see fit.

    24) War elephants
    25) Peanuts
    26) Bistatic NLOS radar
    27) Wind vane powered ground water pump
    28) 10000 ft room temperature superconducting cable
    29) Binoculars with optical frequency computational Fourier optics
    30) Bicycle with spare tubes and manual air pump
    31) 40 meter telescope with adaptive optics and laser guidestar
    32) Dewar capable of storing 20 tonnes of liquid helium
    33) HFT glue backed heat shrink kit

  22. Re:Trump Administration Survival List by Anonymous Coward · · Score: 0

    - Non-lethal weapons are also useful and probably overlooked. I would have an assortment to include mace, tasers, bean-bag rounds, riot helmets, shields, etc.
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    - Air compressor
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    - Cast iron cookware

  23. Re:Trump Administration Survival List by Anonymous Coward · · Score: 0

    24) A disguise kit will all kinds of makeup, wigs, beards, ethnic clothing, etc. in case you have to sneak past a checkpoint. A burqa would probably be useful to conceal your identity without looking suspicious.
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  24. Re:They haven't really done anything new... by Anonymous Coward · · Score: 0

    NV wasn't made by Bethesda, and any bugs were either leftovers from the Gamebryo abomination they call an engine, or Obsidian's doing. At least, IMO, Obsidian had the best 3D Fallout game underneath those bugs (and I won't deny or downplay just how buggy the game was at launch)

  25. Re: Trump Administration Survival List by Anonymous Coward · · Score: 1

    McGyver list

    1. Paperclip

  26. It ain't over... by Anonymous Coward · · Score: 0

    There will be YEARS worth of appeals on this.. Trust me...

    In the end, only the lawyers will make anything.

  27. Re: Trump Administration Survival List by Anonymous Coward · · Score: 0

    Slashdotter do not do girls...

  28. This isn't really a copyright dispute. by jimbob6 · · Score: 1

    This isn't really a copyright dispute. It's a labor dispute.
    This reminds me of the John Fogerty vs Fantasy Records dispute.
    After Fogerty left Credence he went on a solo career and he was sued by Fantasy for sounding to much like himself.
    If Bethesda can't prove that Cormack didn't copy any code that They own, I don't see how they have a case.
    This sets a terrible precedent for the rites of programmers and frankly I think the only reason they're getting away with it is because Facebook is the parent company.

  29. Not settled by any stretch of the imagination by LeftCoastThinker · · Score: 3, Insightful

    Going to an appeals court near you in 3, 2, 1.

    Seriously, this is round 1 out of 5, especially with the amount of money we are talking here.

    --
    If you disagree, please post your argument. (-1, Overrated) isn't your personal censorship tool for views you don't like
  30. When trolls win... by Anonymous Coward · · Score: 1

    Just because he made the mistake of working a bit on VR while he was still employed at Zenimax, even though they haven't done anything VR related, ever... These kind of company policies should be illegal.

  31. Smells like a shakedown by Anonymous Coward · · Score: 0

    This lawsuit would have never eventuated if Facebook had not purchased Oculus. As soon a Facebook was bankrolling Oculus, Zenimax must have thought all of their Christmases would have come at once.

  32. More specifically, the musical notes copied Creede by raymorris · · Score: 1

    More specifically, the claim was that the music of "The Old Man Down the Road" was essentially a copy of "Run Through the Jungle". Fantasy owned the copyright to Run, and therefore also Old Man, *if* Old Man was a copy of Run.

    The jury found that it was not a copy. Judgement for Fogerty.

    Fogerty then sought attorney's fees; the court ruled that Fantasy's suit was not frivolous and denied fees. Fogerty took the issue of fees it to the Supreme Court, who agreed with the District Court - attorney's fees *may* be awarded if the suit if frivolous or brought in bad faith, the statute does not require that fees be awarded in all cases.

  33. Re:Trump Administration Survival List by Anonymous Coward · · Score: 0

    29) Binoculars with optical frequency computational Fourier optics

    Doesn't any lens effectively perform a Fourier transform?

  34. Full Court Record by speedplane · · Score: 1

    All of the court documents are available at the link below, including lawyer arguments and questions from the jury: https://www.docketalarm.com/ca...

    Disclosure: I run Docket Alarm.

    --
    Fast Federal Court and I.T.C. updates
    1. Re:Full Court Record by Anonymous Coward · · Score: 0

      Why would anyone care if you run Docket Alarm or not?

    2. Re:Full Court Record by UnknownSoldier · · Score: 1

      They shouldn't but the OP was being respectful via full disclosure.

  35. fault of shitty managers priority lists by cheekyboy · · Score: 3, Interesting

    this is because asshole managers who reprioritise the bug list, and make some obvious quick fixers so -1000 its not funny.

    My moto is, if im coding after my 40hrs/week, its free time, and I can do whatever fucking bug I like. Since officially, I am coding for free, not being paid over time, fuck your priority lists. I will fix whatever god damn bug I like thats fun to fix, or quick to fix.

    Always the priorities are bull shit any way.

    There should be a dual layer of priorities where quick, simple , 5 minute fixers should be as high priority as show stoppers.

    Even if a bug is so low priority, but embarrassing, but fixable in 5 seconds, FIX IT. Or we should be allowed to fix whatever god damn bug we emotionally fucking feel like it to feel happy, or to get more Bugs/Day done.

    We coders arent robots, we have intelligence that we should be allowed to override our slave masters wishes.

    --
    Liberty freedom are no1, not dicks in suits.
  36. Re:They haven't really done anything new... by Anonymous Coward · · Score: 0

    Bethesda's version of Gamebryo is a bit like the Ship of Theseus, it's has so many bits pulled off and bolted back on in a desperate attempt to keep it shambling along for just-one-more-game that it's hardly fair to call it Gamebryo anymore.

    The only original code left is the bit that moves and rotates objects so that anything placed within 1 foot of a wall automatically clips through.

  37. Now what Court in Texas was that in? by Anonymous Coward · · Score: 0

    I'm guessing it's the same court where all tech law-suits go, because that's the only place you win.

  38. Re: Trump Administration Survival List by Anonymous Coward · · Score: 0

    1) 10 pounds of weed(dried)

    2) a pound of phsycadelic mushroom(dried)

    3) spore prints and marijuana seeds.

  39. Re:Trump Administration Survival List by Anonymous Coward · · Score: 0

    Also handy are

    37. Multiple rocket launcher vehicle
    38. Kilometers of barbed wire
    39. 5 megawatt natural uranium nuclear reactor
    40. Plutonium processing plant
    41. Mig 29
    42. Phased array radars
    43. Anti-aerial missile enclosed in a tube where the top blows off and the missile is ejected before firing up

  40. But facts are facts by Anonymous Coward · · Score: 0

    After reviewing the court proceedings, it is abundantly clear this should be overturned on appeal; assuming the lack of a miscarriage of justice

    This was all about the pay day for ZeniMax, and not based on the facts of the case, but of dumb jury's buying suave lawyers arguments and grand descriptions