Facebook & ZeniMax Settle Major Legal Dispute Over VR Intellectual Property

Facebook and ZeniMax Media have officially settled the long-running lawsuit that alleged Oculus stole intellectual property developed by the company’s current CTO John Carmack back when he was employed by ZeniMax’ child company id Software.

ZeniMax took Oculus to court after its acquisition by Facebook in 2014. Three years later the jury convened at the Federal District Court in Dallas and ended up awarding ZeniMax $500 million in damages, to be paid by Facebook and key Oculus employees.

In June this year, that figure was reduced by half, bringing ZeniMax’s claim against Facebook to $250 million. Those remaining damages covered copyright infringement and breach of contract, however damages relating to trademark infringement and false designation were rejected, which stipulated that Oculus pay $50 million, then-CEO Brendan Iribe pay $150 million, and co-founder Palmer Luckey pay $50 million.

Another point rejected by the judge at the time was the halting of Oculus Rift and Gear VR sales.

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The amount of the actual settlement, which was announced yesterday, is however undisclosed. Presumably it was less than the $250 million that was on the table earlier this summer.

An Oculus spokesperson had this to say about the settlement:

“We’re pleased to put this behind us and continue building the future of VR.”

Robert Altman, ZeniMax’s Chairman and CEO, had this to say:

“We are pleased that a settlement has been reached and are fully satisfied by the outcome. While we dislike litigation, we will always vigorously defend against any infringement or misappropriation of our intellectual property by third parties.”

Perhaps now ZeniMax, via child company Bethesda Software, will feel more confident bringing its games Skyrim VR (2017)Fallout 4 VR (2017), and future VR projects direct to the Oculus Store. Up until now, Bethesda has only published their games to Steam and Viveport for obvious reasons.

Although we don’t expect to see bad blood wash off so quickly, at very least Oculus has extracted one of the most serious thorns in their side since the company was acquired by Facebook back in 2014.

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Zenimax and Facebook’s VR Lawsuit has Finally Been Settled

Remember that that Zenimax Media lawsuit against Facebook/Oculus that began around four years ago, with the accusations that Oculus had used some of Zenimax’s intellectual property? Well, it has been announced today that the litigation has now been settled.

ZeniMax vs Oculus

Robert Altman, ZeniMax’s Chairman and CEO, made the following statement regarding the resolution of the case: “We are pleased that a settlement has been reached and are fully satisfied by the outcome. While we dislike litigation, we will always vigorously defend against any infringement or misappropriation of our intellectual property by third parties.”

While the lawsuit has finally come to an end the actual terms of the settlement have been kept confidential, although Facebook has likely shelled out some cash.

The issue started in 2014 with Zenimax Media accusing Oculus of: “illegally misappropriating ZeniMax trade secrets relating to virtual reality technology, and infringing ZeniMax copyrights and trademarks.” This was namely due to both Oculus founder Palmer Luckey and current Oculus CTO John Carmack previously working for the company.

So Zenimax was looking for damages of $4 billion. In early 2017 when a jury found in favour of Zenimax, saying that Oculus violated a non-disclosure agreement (NDA) but decided it wasn’t guilty of misappropriating trade secrets, they awarded Zenimax Media $500 million USD.

The media company wasn’t exactly happy with that amount, but in a further twist in the case a federal court in Dallas, Texas halved the damage payment to $250 million. This obviously went to appeal and its that decision which has finally come to a close.

Oh, and don’t forget that Carmack started his own lawsuit against Zenimax Media in 2017, due to him not receiving the final payment from the sale of his videogame studio id Software, amounting to the sizable sum of $22.5 million. The CTO took to Twitter a couple of months back to reveal that his personal lawsuit had now come to an end.

So the big VR lawsuit has now come to an end, should there be any more, VRFocus will let you know.

Carmack vs ZeniMax Lawsuit Ends

The story of the legal wrangling between ZeniMax, Oculus (and Facebook) and former Zenimax employee and now CTO of Oculus VR John Carmack is quite extensive, with a number of different twists and turns. The saga is still not yet over entirely, but for John Carmack at least, there is some good news, as legal dispute between Zenimax and Carmack is at an end.

The legal dispute first began way back in 2014, when ZeniMax Media, the parent company of Bethesda, filed a lawsuit against Oculus VR and its founder, Palmer Luckey, claiming that Oculus had used code developed at ZeniMax in the Oculus SDK.

John Carmack - OC5

Subsequently, in 2017, John Carmack posted a statement on his personal Facebook page, where he was highly critical of the experts that ZeniMax used during the trial for the lawsuit, and then filed suit against ZeniMax Media for unpaid fees.

The fees were said to be the second half of a payment due to Carmack from the initial sale of his videogame studio id Software. ZeniMax were said to be refusing to either pay Carmack or convert the due payment into ZeniMax stock. The fees were reported to be worth over $22.5 million (USD).

Carmack announced on Twitter that the dispute was now concluded. His twitter post said: “My personal legal disputes are over – ZeniMax has fully satisfied their obligations to me from the purchase of id Software, and we have released all claims against each other.”

The Twitter post did have an addendum that the appeal for Oculus is still going forward. Oculus are currently appealing the $200 million that was ordered against Oculus for breach of contract and an additional $50 million for copyright infringement.

A previous order for $250 million which was ordered against Oculus and its co-founders Palmer Luckey and Brenden Iribe for false designation was dismissed by the court as it was judged to lack sufficient evidence for damages.

For future coverage on the ongoing Oculus and ZeniMax, keep checking back with VRFocus.

ZeniMax Sanctioned In Ongoing Oculus Dispute

ZeniMax Sanctioned In Ongoing Oculus Dispute

More bad news for ZeniMax Media in the ongoing legal dispute with Facebook’s Oculus.

The company, which owns Fallout and Elder Scrolls developer Bethesda, had its request for Oculus to pay $40 million in attorney fees thrown out on Monday, Law360 reports. Texas federal judge Ed Kinkeade issued the sanction, noting it was in response to ZeniMax’s failure to provide relevant documents that company CEO and Chairman Robert Altman indicated he knew of during two court orders.

According to the report, the documents pertained to ZeniMax’s value and Altman’s stake in the company. Upon a third court order, ZeniMax produced 72 documents that it had not provided before without, according to Kinkeade, any explanation for their absence in previous orders. Oculus still contends that there may be yet more documents unprovided, though the judge also denied the company’s request for a partial retrial.

“What is unmistakably clear to the court is that the plaintiffs, not their attorneys, engaged in continued and repeated efforts to resist production of responsive documents in willful violation of at least the court’s first and second orders,” the judge wrote.

Oculus was ordered to pay ZeniMax $500 million in damages last year after the latter claimed Oculus COO John Carmack had stolen technology when moving from the Bethesda-owned id Software over to the VR specialist. Back in June 2018, however, Oculus was able to halve that payout to $250 million, while ZeniMax’s efforts to have sales of the Oculus Rift were rejected. A judge called for the end of the dispute over a year ago now but it shows no signs of slowing down; Facebook still intends to appeal the remaining $250 million payout, so you can be sure there are still more developments to come on the case.

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Damages Amount Halved in Oculus vs ZeniMax Case

The legal proceedings involving the case that ZeniMax Media has brought against Facebook regarding the technology used by Oculus continues to throw up new twists and turns. This time, a US Court has halved the amount of money that a jury initially ordered Facebook to pay.

A federal curt in Dallas, Texas halved the $500 million (USD) that was initially ordered to be paid to ZeniMax Media as a result of an allegation that Oculus store the technology used in its virtual reality (VR) systems.

Oculus from Facebook art

US District Judge Ed Kinkeade also refused a request by ZeniMax Media that all sales and promotion of Oculus products be banned due to the copyright violation that ZeniMax says has occurred.

The initial judgement came in February 2017, with Facebook, Oculus and other defendants ordered to pay a combined $500 million to ZeniMax, after finding that Oculus did use computer code developed by ZeniMax in the creation of the Oculus Rift.

Judge Kinkeade said that the $250 million ordered against Oculus and its co-founders Palmer Luckey and Brendan Iribe for false designation lacked sufficient evidence for damages.

The order for $200 million for breach of contract and an additional $50 million for copyright infringement will remain in place.

As reported by Bloomberg, ZeniMax is said to be considering its next step, with a statement from the company reading: “Based on a strong evidentiary record, the jury in this case found that ZeniMax was seriously harmed by the defendants’ theft of ZeniMax’s breakthrough VR technology and its verdict reflected that harm.”

Palmer Luckey

Facebook vice president and deputy general counsel Paul Grewal said to Bloomberg that the court ruling: “was a positive step toward a fair resolution, and we will be appealing the remaining claims. We’ve said from day one the ZeniMax case is deeply flawed, and today the court agreed,” Grewal said in a statement. “Our commitment to Oculus is unwavering and we will continue to invest in building the future of VR.”

For further coverage of the ZeniMax Media and Oculus case, keep checking back with VRFocus.

Facebook’s ZeniMax Lawsuit Payout Halved To $250 Million

Facebook’s ZeniMax Lawsuit Payout Halved To $250 Million

The $500 million a court ordered Oculus owner Facebook to pay ZeniMax Media last year has been halved to $250 million in a new ruling.

A US judge also this week rejected ZeniMax’s request to have sales of the Oculus Rift banned, Bloomberg reports.

ZeniMax, parent company of videogame publisher and developer Bethesda, took Facebook to court last year over an alleged theft of technology. The company claimed that Oculus CTO John Carmack had used Bethesda’s resources when collaborating with Rift inventor Palmer Luckey in the early days of Oculus and stolen technology when he moved to the VR company from Bethesda-owned id Software in 2013. id was the first developer to work with Oculus, showcasing a VR version of Doom 3 running on a very early prototype of the Rift at E3 2012. ZeniMax filed the lawsuit after Facebook bought Oculus for what’s thought to be around $3 billion in 2014.

After a lengthy court battle, which saw Carmack, Luckey and even Facebook CEO Mark Zuckerberg take the stand, a judge ordered Facebook to pay Bethesda $500 million. Carmack later took to Facebook to argue that the internet would have “viciously mocked” the analysis given in court.

Facebook vowed to appeal the decision at the time and, this Wednesday, 16 months on from the ruling, U.S. District Judge Ed Kinkeade wiped out $250 million from the ruling, including damages leveled at Luckey and Oculus co-founder and former CEO, Brendan Iribe.

But Facebook isn’t stopping there; Vice President Paul Grewal confirmed to Bloomberg that the company still intends to appeal the remaining $250 million, adding: “We’ve said from day one the ZeniMax case is deeply flawed, and today the court agreed. Our commitment to Oculus is unwavering and we will continue to invest in building the future of VR.”

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VR vs. Nostradamus (2018 Edition) – Part Three

Okay, here we are. Part three and just in the nick of time before we all phase out of January and into February. It’s also rather close to me disappearing by way of a week off around my birthday so let’s get these underway, shall we? As with some of the ones before some or potentially all of these are connected in some way – but this time not with an overall theme. More than one could, in theory lead in to another and another after that. In one case it deliberately does. It’s time to get back to the more familiar names in virtual reality (VR) starting with one prediction that I kind of had last year too.

Time /HourglassBefore we do though, can I just say my thanks to Sony Interactive Entertainment (SIE) who kindly waited until I’d got my VR vs. article including predictions about them and new motion controller technology out before patents about such were found? You can both learn from this Nintendo and Magic Leap!

9) Oculus’ Progress Entirely Undone Within Weeks

I have a work in progress theory about Oculus. Either the place is built on an ancient Indian burial ground or Zuckerberg broke into the Ancient Egyptian tomb of the lost Pharaoh Tech-man-khamun or something when he was younger and has be cursed in a particularly odd manner. As I’ve said before on this series, sometimes it seems that no matter what Oculus does they can’t do good for doing bad, often getting what I at least consider to be the rough end of the stick when it comes to how things pan out.

If they announce X, their rivals will reveal X+ (and probably be cheaper than X just to rub it in), it’s just the way it is. Something always turns up to spoil their day… and there hasn’t been anything yet to do so from their Oculus Connect 4 announcements.  In fact, in a refreshing change of pace, everything seems to be going quite smoothly for the company as it moves towards the release of its two standalone head mounted displays (HMDs) – the Oculus Go and the Santa Cruz.

Now, to be clear I hardly want this to happen, but I am betting on their own tendency for misfortune to follow them that some factor comes along that ruins their party.  As to what this is, I’m not sure. Originally I had this written down as ‘entirely undone by Vive’ and even that it was Oculus’ ‘announcement karma’ but I’m still not entirely comfortable with the wording. Will it be Vive? Will it be someone from Oculus or Facebook’s side that causes a kerfuffle à la Palmer? Or will everything be fine and Oculus continue their good progress without getting set back? We’ll see, won’t we.

10) ZeniMax Reveals Own HMD

Okay let’s get into the juicy bit.

We’re due, and soon I’d wager, the next chapter in the saga that is ZeniMax versus Oculus et al and I have to say it’s something I’m not particularly looking forward to. Ultimately it doesn’t help VR’s standing in the minds of the populous in the slightest. We’ve kind of wondered just what ZeniMax have planned within VR itself, and this prediction is that within this year we’ll have our answer – and it will include details of ZeniMax’s own headset.

Yes, it would make far more sense to leave well alone until things are finally settled in court. I just don’t think they’d care that much about complicating the issue further still. I’m not saying it’ll be a world beater, it may even be something akin to that being produced by Starbreeze (and now Acer) with the StarVR, more targeting event spaces and VR arcades than home use. But I’m thinking if ZeniMax think they are entitled to a piece of the pie (if not the pie entirely) they have the financial clout behind then that they may continue thing by getting more directly involved in the hardware. As for how it is revealed, well it’ll probably be some sort of patent filing as opposed to any actual announcement but either way.

You’re probably thinking that if that actually happened it’d make things very interesting indeed, setting the cat among the proverbial pigeons… and you’d be completely right on that point. So let’s address that next!

ZeniMax vs Oculus11) …And Is Hit With A Patent Violation Claim By Oculus. AND Others

I’ve always been of the opinion that the only thing preventing VR from ultimately becoming a success was itself. That is to say the most likely path for immersive technology was to fail was if it effectively ate itself. Since the beginning of the present generation of VR (let’s call it the second generation after that from the nineties and that which we’re heading towards the third) there’s been something of a degree of camaraderie, for want of a better word, between companies. Whilst the fanbases of each HMD can sometimes throw their toys out of the pram for the makers themselves there’s still that altruistic feeling of ‘we’re all in this together’, even if in some areas they’re not and there’s the odd barbed comment that zips across from Middle Manager No. 6.

ZeniMax do not exactly give off that sense. So, if things do kick off with a ZeniMax HMD expect that, beyond the inevitable claim from Oculus that the headset violates their own patents, that other hardware developers claim the same. Samsung seem destined to be dragged ever deeper into the lawsuit anyway and aren’t afraid of litigation over patents (see: Apple) but I wouldn’t put it past HTC or Sony to make a complaint too to protect their own interests.

Lawsuits! Litigation! Injunctions! Blocks! Unimaginable legal power! Unlimited legal rice pudding! Etc…

12) But It’s Samsung That Surprises Everyone

When all is said and done I’m going to put my virtual money on Samsung being the hardware manufacturer that actually makes one of the biggest splashes this year with something complete out of leftfield. New hardware? Probably. I think we’re owed something from Samsung in that regard now.  The Gear VR does the job and always has done but when it comes down to it is it enough to continue tweaking the design every so often – or is it time for them to step up their game?  I think the latter, and if they cut loose we could see something quite special.

Samsung LogoTechnically I have several more predictions but I might add those in a supplemental update down the road. For now though that’s the end of my predictions for this year. We’ll see how well I did this time in 2019.

VR vs. 2017 (Predictibly) – Part 1

So here we are again everyone. Welcome to 2018 on both VR vs. and on VRFocus. I hope you all had a very good holiday period and new year celebration. I was off playing silly board games and enjoying the company of some friends in what is now something of a tradition. In what is also something of a tradition I came a distant second in Ticket To Ride, expressed interest in a game of Monopoly that everyone ignored because I always win – the last game we played they all actively and openly teamed up against me and I still beat all three of them to much grumbling. I also proceeded to destroy everyone in the one game I’d never played – which was this year Bears vs Babies. A card based game that can be described as ‘from the makers of the far more fun Exploding Kittens. Also we played Pandemic. Pandemic is bloody good.

Perhaps I should do VR vs. Tabletop at some point?

Today however marks my first day back in the saddle, and the last on the VRFocus ‘Christmas Mode’.  So as of tomorrow (Wednesday) it’ll be usual hours for segments, back up to the usual number of stories per day and all hands on deck once again.  Being in the know – well, relatively speaking – I can tell you there’s a lot that’s going on with the website this year. New people, new activities, new responsibilities. It’s going to be a busy ol’ time for us all. Before we get on to the matter at hand and start thinking about 2018 going forward I do have one last needed look back at virtual reality (VR) in 2017 to do.

I know, I know, you’re probably sick of retrospectives at the moment. But this is the one where we look back at my 2017 predictions (or educated guesses) and we see just how badly I stuffed them all up.  In a couple of weeks I can start going through some of my silly little predictions for the year to come.

Prediction: “ZeniMax Becomes VR’s Bad Guy”
Result: False – Through Circumstance

I described this as being “pretty much nailed on” at the time and it certainly looked that way. The ZeniMax situation hasn’t exactly gone away and continues to rear its head, unofficially at least, in a number of ways. For example, the lack of support for Oculus Rift on Bethesda’s recent VR trinity. DOOM VFR only getting support following an update by SteamVR itself, which was described as a “workaround”.

This whole mess is still coming and we are far from done in the battle of ZeniMax vs Oculus/Facebook. Chronologically speaking things escalated this way over the course of 2017: ZeniMax Media acquired Escalation Studios to make VR projects at the same time as ZeniMax was awarded the total of $500 Million (USD). No one was happy with that verdict – Oculus weren’t found guilty of misappropriating trade secrets, so ZeniMax weren’t happy. Oculus still don’t think anything was done wrong at all so they aren’t happy either. John Carmack put ZeniMax’s experts on blast a day later with some very choice words.

ZeniMax then declared that they were going to try and block Oculus from using its VR SDK, Carmack anger turned into a lawsuit of his own against ZeniMax in March, before in May ZeniMax dragged Samsung into things by extending their lawsuit to include the Gear VR.

The ZeniMax situation is still a powder keg.  A ruddy big powder keg that is set to do a lot of damage to VR – but that keg hasn’t gone off yet so I have to mark this prediction as a failure. As we know the role of villain for 2017 ended up being a company I don’t think any of us expected- but the least said about that the better.

ZeniMax MediaPrediction: “Several Trillion Market Research Agencies Will Say VR’s Market Growth Has Slowed/Value Has Reduced”
Result: True

Well this one is true but only really in the sense that everything under the sun seemed to have a market research report on it this year and being such a hot topic in 2016 VR got dragged into a lot of things in 2017, quite a few of which it really had no business being in. Whilst VRFocus reports on a lot of these reports you should see the ones we tossed!  As it turns out more than a few of them did indeed reign in previous predictions a bit for the period to come described in 2016 – but in a lot of cases this reverted to previous levels in the year or two now included after that 2016 prediction period. So, in a sense nothing has really changed. But values were walked back in a lot of them. I’m declaring that one a win.

Prediction: We Would See “The Debut Of Halo-lens”
Result: True.

This prediction starts with “Minecraft this. Minecraft that. Minecraft bloody everything.” and I’m pleased to say that still makes me chuckle. This prediction though was pretty specific. We’d get a Halo title coming to Microsoft’s head mounted display (HMD). At the time I said it was the Hololens. However, what we actually got was Halo: Recruit for the Windows Mixed Reality HMD. Now I wasn’t to know the Windows Mixed Reality series of headsets were coming, but they’re all considered part of the same family of headsets now so we can chalk this one up in the wins column too.

It might not have been what I wanted when I said “a first person Halo experience” in the prediction but it was one. Can we have a proper one next though?

Prediction: “A Big Name Leaves Oculus – And Jumps Ship”
Result: Somewhat True

“Considering last week’s column you may assume I mean Palmer Luckey at this point and it’s entirely possible.” I said at the time and lo and behold Mr. Luckey departed Facebook in March. Though whether or not he fell on his sword, was shown the door to step through it or shown the door to be booted through it is still something of an unknown.

Now whether or not I got this one right is kind of open to interpretation since yes, Luckey left Oculus and he was certainly the biggest name at the company. Even bigger than Carmack. However, he didn’t exactly jump ship.  He did set up his own company, Anduril, later in the year, following a period of self-imposed social media exile. Anduril is working on VR projects so you could count that. Luckey also proceeded to appear with HTC Vive at the Tokyo Game Show, which could also be counted.  Personally, I’m leaning towards a loss on this one but it’s at least 50% right.

Prediction: “Patent Wars: The Family Atmosphere Is Over”
Result: False

This one is quite pleasing. 2016 was full of stories about all and sundry filing patents for immersive technology related matters. In 2017 there was quite a few patent-related news stories as well. Not counting the whole ongoing ZeniMax saga, only a couple of them dissolved into actual legal wrangling: Techno View IP vs Oculus and HoloTouch vs Microsoft.

Other than that, the whole atmosphere between the HMD manufacturers remains both cordial and respectful which is good to see. Of course, the fanbases for each have degenerated into a lot of shouting and one-upmanship as has previously been discussed. Still at least the stakeholders can get along, right?

Prediction: “A VR Only eSports Tournament”
Result: True.

Well, I didn’t quite expect this one to come off but low and behold it did. Whether or not you think that VR is the future of eSports is immaterial. With thanks to Oculus and Intel it came to be in the guise of the VR Challenger League.  The tournament hosted a $200,000 (USD) prize for Echo Arena and The Unspoken – which is a pretty sizeable chunk of change. One more than worthy of qualifying this, particularly with its association with ESL – and a ‘proper’ tournament and the sort that I was hoping to see when I made that prediction.

Personally, I can’t wait to see what comes of things like this in 2018. We know Intel have their plans and I’ve recently gone on record as saying you should watch out for them this year. What have Oculus got up their sleeve though? I do hope we’ll see this become a regular fixture of the VR calendar.

VR Challenger LeagueI’m going leave things there for part one. We do have three weeks’ worth of VR vs. features to actually go through so we’re going to have to split it up a bit out of necessity.  Join me again next week to see if I continue to do surprisingly well with these!

Release Dates & Platforms for ‘Skyrim VR’, ‘Doom VFR’, and ‘Fallout 4 VR’ Revealed

In the build-up to QuakeCon 2017, which starts tomorrow, Bethesda has announced launch dates for their three major VR titles for the holiday season. Skyrim VR (PSVR) launches first on November 17th, followed by Doom VFR (PSVR, Vive) on December 1st, and finally Fallout 4 VR (Vive) on December 12th, rounding out what promises to be a very merry VR holiday.

Skyrim VR remains a PSVR-only title for now, but is likely to find its way to PC. Bethesda continue to refer to the PC versions of Doom VFR and Fallout 4 VR as ‘Vive’ games, but they are both likely to be playable with Oculus hardware, whether pseudo-officially via OpenVR’s support for the Rift, or with an unofficial workaround to unlock any purposefully imposed barriers, as we’ve seen with other SteamVR games which attempted to block Rift functionality.

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The legendary annual QuakeCon is held in Dallas, Texas hosted by parent company ZeniMax Media is home to publisher Bethesda Softworks’ world-famous IP, with this year’s focus on the Quake World Championships esport competition. Attendees can also get hands-on time with a number of upcoming Bethesda-published games in the Exhibit Hall, including all three VR games, plus Quake Champions, The Evil Within 2, Wolfenstein II: The New Colossus and Dishonored: Death of the Outsider.

The hall will be open from Thursday to Saturday 10am–6pm daily. For further information on QuakeCon 2017, visit the official site.

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