Facebook Will Respond Soon To Proposed ZeniMax Judgment

by Ian Hamilton • February 23rd, 2017

ZeniMax filed for a proposed judgment and final injunction in its $500 million case against Oculus.

The company proposed Oculus be “permanently enjoined, on a worldwide basis, from using…any of the Copyrighted Materials, including but not limited to (i) system software for Oculus PC (including the Oculus PC SDK);  (ii) system software for Oculus Mobile (including the Oculus Mobile  SDK);  (iii) Oculus integration with the Epic Games Unreal Engine; and (iv) Oculus integration with the Unity Technologies Unity Game Engine.”

ZeniMax declined to comment. A Reuters report suggested “the injunction could limit the number of games available for sale for Oculus’ Rift VR headset.” Facebook provided the following statement:

ZeniMax’s motion does not change the fact that the verdict was legally flawed and factually unwarranted. We look forward to filing our own motion to set aside the jury’s verdict and, if necessary, filing an appeal that will allow us to put this litigation behind us.

I’ve uploaded two of the documents filed by ZeniMax lawyers outlining the legal reasoning. Those documents are uploaded here and here. Referring to the $500 million award, ZeniMax argued:

“The jury’s damage award here, however substantial, is an insufficient incentive for Defendants to cease infringing. Just minutes after the jury revealed its verdict, Facebook’s COO, Sheryl Sandberg, publicly stated that the jury’s verdict of a half billion dollars was “not material to [Facebook’s] financials.”

Earlier this month a Texas jury found Oculus did not misappropriate trade secrets from ZeniMax, which was the previous employer of Oculus Chief Technology Officer John Carmack. The jury, however, decided Oculus co-founder Palmer Luckey failed to comply with a non-disclosure agreement he signed and Oculus was liable as a result. Oculus, and its co-founders Luckey and Brendan Iribe, were found to owe ZeniMax $500 million as a result of copyright infringement and “false designation.”

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  • JSM21

    Well that has me worried…. What $500 mill isn’t enough now they are going to try to, ultimately, punish the Oculus consumers? Sounds messed up to me.

    • user

      ya, everybody knows if somebody steals your car and sells it, you cant get it back because that would make the customer who bought it sad.

      • Xron

        If they steal your gp’s that u weren’t even using for years, you force them to pay for whole car. Legit Usa ‘justice’.
        Like a joke that was going around for ages, that some woman fried her cat in Microwave and then sued corporation that made that Microwave, because there were no warnings about not using Microwave that way. 😛
        Thats why patents strategy has BIG holes in it and corporations are using this crappy system as much as they like, the only sad thing is that Vr might suffer because of these ‘Lawmakers’.

    • DougP

      Re: “punish the Oculus consumers?”
      Ummmm…that would be NOPE!
      Or did you read somewhere that the judgement was *against* the consumers? If so, it was incorrectly reported.

      • blueredgreenyellow

        “punish the Oculus consumers” is referring to that worse case all, Oculus product will be briked, because some base program code can’t be used. So yes an injunction would indirectly punish any one that purchased a Oculus product. The word you need to read is “ultimately”. Its about mid post in case you missed it.

        ultimately
        finally; in the end.

        Tho If the worst case does happen (doubtful) would it be Oculus or Zenimax that is punishing the end consumer for believing in this product. It a little self center to say we will be punished. I see it more as collateral damage.

        • DougP

          The court was determining the affects on consumers. This was between Zenimax & Oculus.

          Worrying about who else is affected downstream, not involved in the case, is not how this works.
          It’s somewhat analogous to saying this scenario:
          Man kills some person & court rules he should be jailed – & because he has children people complain – “the court is punishing his children!” because they will be impacted by his inability to provide for them/other negative outcome for them.

          So your “collateral damage” is a more apt description.

  • Sami Tito

    So sad. How to kill vr industry. Good job zenimax.

    • Me

      I’m concerned too, but it seems logical for Zenimax to continue like this. I mean any company that would have been in the same situation would have done the same, whatever the origin of the problem was.
      If I disagree with my boss (who might have very good reasons not to follow your ideas) about the company stretgy it doesn’t give me the rights to strip it from the parts i disagrre with and build my own company based on that.

      Facebook has the money and the means to build a new system. It already has a well known brand (you start to see rifts in TV series !), they should just release a rift 2 with updated code based on the new Khronos standards and leave Zenimax the now obsolete code.

      I mean it would cost FB quite some dollars, buit at the end they will still be a major actor in the VR market.

      This all reminds me about the Samsung vs Apple case, where Samsung blatantly copied the iPhone, was condemned for it, but still ended up being in a leader position, something they would’nt have achieved without this shady first move.

      • Get Schwifty!

        Yup – welcome to the business world kids, SJW’s not withstanding, people will always do shady things. You can be certain HTC has their fair number of skeletons buried behind the building, but its not currently hip to think of it that way.

        I definitely agree this could be the best thing for Oculus as they have an opportunity to make a clean break for the past and take a different approach with their experience and funding now. They could even “for free” upgrade existing customer as the base is quite small (same for Vive) relatively speaking and in effect re-launch themselves without losing face in the business.

        Yes, on the Samsung point its funny how people conveniently forget that lawsuit when they favor a product often…

      • Scott C

        The Samsung vs. Apple case is a pretty atrocious example, considering that it upheld “a rectangle with rounded corners” as a valid design patent.

        Not to mention, the jury didn’t find Oculus guilty of using trade secrets, it found Carmack guilty of copying data and various people guilty of breaching NDAs.

        The whole “500 million isn’t enough because Facebook says it shouldn’t cause them a stock hit” thing just reveals exactly what their interest here is — more money because Facebook can afford it.

        • CaptainAwesomer

          It seems obvious to us now, but back then everyone had rectangular phones. So when Apple came out with a rectangular phone with rounded corners, it just blew everyone’s minds.

          Apple was considered for a Nobel Prize for design, and even Stephen Hawking was impressed with their rounded corners.

  • ZeniMax’s lawsuit and injunction against Oculus are seriously going to impact the various games related to the latter’s VR headset.

    • Get Schwifty!

      Probably not. Not saying it to be contrarian or pro-Rift, but that money is already “out there” and effectively in motion, not to mention Oculus effectively speaking has more funds than the company directly represents since Facebook owns them. The greater threat is what it does to development of the platform as a whole I think, as that is “softer” money and more subject to change in most companies….

      • This is all depending on whether or not the injunction even gets passed… Man are people ever jumping the gun here lol.

      • Nicholas Finney

        it blocks the sdk used to make the games so actually it really could stop the development of the games also since some devs signed terms stating they cant release on other platforms for a period may not see those games for a while

  • It is shocking to know that Oculus co-founders owe ZeniMax company a mammoth sum of $ 500 million dollars.

  • Tad Springer

    I can understand Zenimax going after Oculus if they think they misapropriated trade secrets, but they’re going too far here. This will affect the consumers. I always enjoyed Zenimax games, but if they’re going to act like this I’ll happily make Fallout 4 the last Zenimax game I buy. Pretty sure I won’t be alone there. Great work on becoming the next EA games Zenimax…

    • DougP

      Re: “this will affect the consumers”
      What?
      This case isn’t about that.
      So if say a father commits some crime, he shouldn’t be punished/jailed because “it will hurt his children”? That’s the same logic… actually yours is worse because in that analogy there’s a direct correlation to the dependent suffering.

      • Tad Springer

        No, it’s not the same at all. Oculus have been punished – they had to pay $500M (and that was just for breaking

        non-disclosure agreements, not misapropriation which was Zenimax’s claim). Zeniman now want to cease all Oculus activity though, which will include the Oculus store and therefor. Zenimax is pushing for more punishments that will also affect consumers; so going by your analogy it would be like pushing for a father to be jailed explicitly in order to affect his children when a punishment can be made that doesn’t need to affect innocent parties.

        • DougP

          No, it’s not.
          The $500M was NOT a judgement against Oculus consumers. Further, using that analogy – this is ordering the FATHER to do something (like – STOP breaking the law). Again, you’re complaining about collateral damage. If Oculus people hadn’t committed a wrong-doing then their consumers wouldn’t be affected.

          Stop blaming the courts for doing their jobs because you wish Oculus could do whatever they wanted w/o repercussions, to the benefit of their consumers.

  • Sami Tito

    Zenimax will kill vr revolution… it will be a catastrophe for every actor in this industry. Very bad buz for the vr.

    • What makes you think they will be granted the injunction?

  • DougP

    “The arc of the moral universe is long, but it bends towards justice.”

    Justice was served!

    Quit crying over Carmack/Luckey or even Zuckerberg – they won’t be living in the streets after this & Facebook will continue with VR.

  • crazysapertonight

    Does this could really be a problem?