Here’s What We Know About ZeniMax v. Oculus VR

by Garrett Glass • January 20th, 2017

Over the past two weeks, ZeniMax Media and Oculus have been duking it out in the Earle Cabell Federal Building and Courthouse in Dallas, TX, and we’ve been observing and taking notes.

ZeniMax alleges the Oculus Rift headset was built using their technology, and that it was allegedly stolen by John Carmack when he left subsidiary id Software in 2013. Oculus, on the other hand, believes ZeniMax’s litigation is “wasteful” and an “attempt to take credit for technology that it did not have the vision, expertise, or patience to build.”

Because ZeniMax Media v. Oculus is a jury-based trial, both companies are attempting to win the jury over with analogies involving chili recipes and bicycle modifications to explain complex technology. During the week, both sides tried to poke holes in the other’s explanations, and that’s when things got heated and messy. Here’s what we’ve gathered from inside and outside the courtroom.

Everyone Loves/Hates John Carmack

John-Carmack

John Carmack first took the stand on Tuesday, Jan. 10 and didn’t leave until Thursday, Jan. 12. Sporting a beige suit and growing puce in the face when speaking, Carmack looked like he’d rather be back in his office, or in VR, than explain to ZeniMax attorney Tony Sammi that he is “not a Mac user unless under duress.” ZeniMax described Carmack as a “a singularly experienced and highly proficient” programmer, and claimed “there would not have been a viable Rift product” without the help of  ZeniMax employees.

Sammi’s questions focused on the allegations that Carmack used ZeniMax-owned computers to work on the Oculus Rift, took thousands of files and emails via USB drive upon leaving the company in 2013, played a role in soliciting five employees from id Software, and used “VR testbed” code to benefit the Oculus Rift. Carmack said he found a MacBook in his closet which contained code from id’s RAGE, and copied files and emails owned by ZeniMax.

According to Gizmodo, Carmack said, “I copied files that I shouldn’t have. I think stealing is an uncharitable way to look at it since I didn’t benefit and ZeniMax didn’t lose, but I shouldn’t have done it, and I did.” Beth Wilkinson, Oculus’ lawyer, also said Carmack shouldn’t have copied the files, and that he turned everything in within a year of the litigation being filed.

Nevertheless, Carmack eventually took his own shots at ZeniMax, claiming the media company never paid him his severance package. He also said he “was not involved in the solicitation [of five ZeniMax employees] at all,” and believes “Oculus did not benefit at all from the documents [he] copied onto the USB drive.” When ZeniMax promised to bring in expert analysis to supposedly trace code to Oculus’ benefit, Carmack simply replied, “Yes, I’m looking forward to seeing that analysis.”

On May 1, 2014, Carmack tweeted “No work I have ever done has been patented. Zenimax owns the code that I wrote, but they don’t own VR.”

$2 Billion? Better Make that $3 Billion

brendan-zuckerberg-touch

Mark Zuckerberg, CEO of Facebook, and Oculus founders Palmer Luckey and Brendan Iribe took the stand in-person from Jan. 17 to 18. And they revealed some startling new numbers.

Early into his questioning, Zuckerberg said the total cost of the Oculus acquisition was closer to $3 billion, not the $2.3 billion previously reported. Mike Isaac of the New York Times live-tweeted his breakdown of the numbers before the court shut down all live-tweeting of the case. “[We] bought the company for about 2b, had additional 700mm in retention for key folks, 300 mm earnout for milestones.”

Throughout the rest of his testimony, however, Zuckerberg said he hadn’t been keeping up with the other defendants’ testimonies, and says he trusts his legal team.

“They’re not gonna take up a lot of my time on something they don’t think is credible,” he said.

If anything, Zuckerberg tried reinforcing the idea that “Oculus products are built using Oculus technology.”

Luckey and Iribe discussed talks between Oculus and ZeniMax Media in more detail. They wanted Carmack to work as a technical advisor at Oculus in exchange for a 2 percent ownership stake. ZeniMax, however, was said to have countered with 15 percent, which Iribe thought felt like “a slap in the face.”

Luckey would frequently say “just to be clear” when he felt the evidence shown on the projector failed to convey proper context. Sammi brought up one email in which co-founder Nate Mitchell wanted everyone to stop discussing legal matters via email because it is “permanent,” leading Sammi to ask Iribe: “What’s the problem of being permanent?”

So, Where Are We At Now?

Ian Hamilton experiences the Oculus VR virtual reality head gear at the company's Irvine office with the help of CEO Brendan Iribe.

Currently, the trial is focused on source code and whether or not Oculus used it.

Shortly after Iribe left, Sammi called Professor David Dobkin of Princeton to the stand. He said he analyzed the VR “testbed” code and, at the end of his session, Dobkin said he is “absolutely certain Oculus copied from ZeniMax code.”

Next, the plaintiffs called Professor Michael Gleicher of University of Wisconsin-Madison to the stand, but the day ended not long after he described his experience in VR. His testimony concluded today and Robert A Altman, ZeniMax chairman and CEO, is answering questions much of Friday. Those answers, and how Oculus’ lawyers will respond, will be covered in a future update.

We’re reaching out to Oculus and ZeniMax representatives to confirm who else we can expect on the stand during what is expected to be the final week of the trial.

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  • Seems like a petty trial. Seems like ZeniMax just wants to try their luck with getting a payout from Oculus/Facebook because they’re salty that they didn’t push the VR technology when it was right under their nose. Anyway, this is great reporting. This is the type of journalism we need.

  • Vikon99

    Every person working in the game industry for a company of any size signs a non-compete that guarantees the work product you create while being employed belongs to that company when created on company time and on company assets/hardware. id Software enforced that practice before it was acquired by Zenimax and after. Carmack himself was bound by that after ZMI purchased them. I have my owned signed Non-compete from ZMI that lays out exactly what they reserve rights to.

    It is obvious at this point that Carmack thought he wouldn’t be caught doing it and that Luckey and Zuckerberg pulled a fast one and failed due diligence respectively.

    This should be taught at Universities as an object lesson for what NOT to do when you are employed at a company. Carmack and Luckey won’t have jobs when this is over, as ZMI has a superb case against them.

    • Vikon99

      Plus, for Carmack to say he did not participate in luring employees away is specious on its face. They just “happened” to be his “Studio Besties” out of 150+ employees.

    • UmYeahNo

      1) Carmack sold the company to ZMI. 2) I’m sorry dude but you aren’t Carmack and I wouldn’t be surprised if he had deal that is not like regular developers. I mean, owns (owned?) a fucking rocketship company – do you think they had the rights to any research and development from there?

      • Vikon99

        Nope, not Carmack, but I have designed sold more than 20 million games in a 24 year career. So, not too bad.

        What have you done lately, I wonder?

        Carmack had a standard non-compete coupled with a deal where he had to stay with id for a certain length of time after ZMI purchased id, as he was considered part of the valuation of the company.

        • bschuler

          Drops the mic..

      • David Melton

        Lol, I guess you didn’t realize who you were talking to.

        • UmYeahNo

          Ok, but then he was not allowed to develop software for anyone including Armadillo?

          • Joshua Johnston

            Those agreements are typically worded to refer to competition in the same industry. As Armadillo wasn’t involved in video game hardware or software, there wouldn’t be an issue.

  • user

    “Nevertheless, Carmack eventually took his own shots at ZeniMax, claiming the media company never paid him his severance package.”

    so he even had an additional motive? 😀

    • …for leaving Zenimax for Oculus you mean right?

      • user

        i think you have to leave first, then get severance pay. i think thats how it works.

        • I think you’re right and I was confused, but then your timing doesn’t make sense. You’re implying that he had motive to… “abuse Zenimax code, leave Zenimax for Oculus” because he didn’t get severance pay (that he wouldn’t be denied until after he left)?

          • user

            “played a role in soliciting five employees from id Software, and used “VR testbed” code to benefit the Oculus Rift.”

            that happened later, i guess 🙂

          • A motive must exist before a crime/infraction though. I don’t think the timing can work in such a way that the lack of severance package could have been a motive since as you pointed out, he’d have to have left and been denied the severance before supporting Oculus and/or soliciting Zenimax employees. More likely the severance was denied because he’d already left, shown use of code and/or solicited employees and Zenimax saw one or more of those actions as grounds to deny him. Now if they didn’t know about any of it AND denied him, then they’re being pricks and he’s got a point, but none of us outside the mess could possibly know if that’s the case.

          • user

            maybe. i wasnt too serious about it 😉

          • Maybe I shouldn’t have commented to begin with given how confused I was. 😉 Good fun though.

        • Vikon99

          Severance is when They let You go, John. Not when you ditch them.

          I swear he lives in a goddamned bubble.

          This attitude is why ZMI will win the case.

          • David Melton

            Unless Facebook decides to access all the jurors’ Facebook profiles in order to perform extensive psychological motivational analysis of how best to persuade them in their favor.
            OK its just a theory.

  • user

    >>Early into his questioning, Zuckerberg said the total cost of the Oculus acquisition was closer to $3 billion, not the $2.3 billion previously reported. Mike Isaac of the New York Times live-tweeted his breakdown of the numbers before the court shut down all live-tweeting of the case. “[We] bought the company for about 2b, had additional 700mm in retention for key folks, 300 mm earnout for milestones.”<<

    why are the 300 million for milestones included? isnt it usual that the company which buys another company keeps subsidizing it?
    when i buy a pet and then feed it because, you know, it cant hunt its own food, do i have to add the food money to the buying price?

  • Who wrote the code in question to begin with? If it was Carmack, to what degree can anyone expect him to “forget” knowledge/art he created? If he can’t to some significant degree, you have to expect that if he wrote that code again later, it will be quite similar. Even if he didn’t write it, the more familiar he was with it, the more that is true. To say that he copied the code would require identifying nuances that weren’t so much about the code, but formatting and would have a low probability of being similar as a result of trying to recreate the same results in terms of what the code was to do. I wonder if they have/will reveal more about the analysis done by Professor David Dobkin in light of those realities. An opinion alone isn’t proof, but just that; an opinion. Not saying he did or did not (though having talked with John a few times, I have my thoughts), but as far as a court is concerned, software needs to be approached like anything else, if at all. The best the legal system can do regarding software for these reasons is look for outright copying of code, otherwise they shouldn’t go anywhere near it due to how much like art it is, but lacking the benefit of a laymen being able to make a decent call as to how similar 2 works of code are.

    • user

      id like to hire you if you can remember thousands of lines of code sign by sign.