Oculus Ordered to Pay $500 Million to ZeniMax

The spat dates back to 2014 when ZeniMax sued the virtual reality firm for misappropriating trade secrets.
Oculus Ordered to Pay $500 Million to ZeniMax
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This story originally appeared on PCMag

Facebook-owned virtual reality company Oculus has been ordered to pay $500 million in damages to video game publisher ZeniMax Media for failing to comply with a non-disclosure agreement.

The decision came back Wednesday after the Dallas jury deliberated for two and a half days on a verdict, according to Polygon. They also said Oculus did not misappropriate ZeniMax trade secrets, as the publisher had claimed.

"The heart of this case was about whether Oculus stole ZeniMax's trade secrets, and the jury found decisively in our favor," an Oculus spokesperson told PCMag. "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."

The spat dates back to 2014 when ZeniMax sued the virtual reality firm for misappropriating trade secrets, breach of contract, unjust enrichment and unfair competition. According to the complaint, former employee John Carmack started corresponding with Oculus VR founder Palmer Luckey in April 2012, when the Oculus Rift was "a crude prototype."

Luckey gave Carmack an early version of the Rift "and Carmack and other ZeniMax personnel added numerous improvements to the prototype," the complaint said. "Together, those ZeniMax employees literally transformed the Rift by adding physical hardware components and developing specialized software for its operation."

Oculus later hired Carmack as its CTO, which ZeniMax claimed put its intellectual property -- "including trade secrets, copyrighted computer code and technical know-how relating to virtual reality technology that was developed by ZeniMax after years of research and investment" -- at risk.

Despite the victory, ZeniMax was seeking a lot more: in closing arguments, the company's lawyer said it should win $4 billion in compensation and punitive damages, Polygon notes. Oculus's attorney said ZeniMax was just embarrassed and jealous.

Facebook and ZeniMax did not immediately respond to requests for comment.

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