Lawsuit accusing Facebook-owned Oculus of intellectual property theft heads to trial

The story of Oculus’ origins is well-known. A teenager named Palmer Luckey creates a prototype for a virtual reality headset in his parents’ garage, crosses digital paths with a reputable video game programmer and starts a company that Facebook purchases for $2 billion.

But a lawsuit against the virtual reality company set for trial Monday paints the story of Oculus’ origins as a “fanciful” tale. It accuses Oculus of using stolen technology from ZeniMax in its Rift headsets.

“Luckey lacked the training, expertise, resources or know-how to create commercially viable VR technology, his computer programming skills were rudimentary and he relied on ZeniMax’s computer program code and games to demonstrate the prototype Rift,” the lawsuit states.

The 2014 lawsuit against Oculus and Luckey was later amended to include Facebook, Oculus’ former CEO Brendan Iribe and John Carmack, who left ZeniMax in 2013 to become Oculus’ chief technology officer. ZeniMax is seeking $2 billion in damages.

ZeniMax also accuses Facebook of closing its purchase of Oculus even after it found out that the virtual reality company allegedly misappropriated intellectual property from ZeniMax.

Facebook-owned Oculus has denied the allegations and claims that “not a line of ZeniMax code or any of its technology” was used in any Oculus VR product. ZeniMax only raised infringement claims and wanted a quick payout after the social media giant bought Oculus, according to court documents.

“We’re eager to present our case in court. Oculus and its founders have invested a wealth of time and money in VR because we believe it can fundamentally transform the way people interact and communicate,” an Oculus spokesperson said in a statement. “We’re disappointed that another company is using wasteful litigation to attempt to take credit for technology that it did not have the vision, expertise, or patience to build.”

Bloomberg, which reported this story earlier, said Facebook CEO Mark Zuckerberg could be called on to testify as a witness during trial.

Luckey’s involvement with ZeniMax dates back to 2012 when Carmack reached out to the college student for the prototype of the Rift, which he heard about on an internet forum. Carmack is the co-founder of id Software, a Texas video game developer owned by ZeniMax. Carmack and the company’s employees then transformed the headset “from $500-worth of optics into a powerful, immersive virtual reality experience,” the lawsuit alleges

ZeniMax also used the modified headset to showcase a video game developed by id Software called “Doom 3” at the E3 Convention in Los Angeles that year. Luckey then started the virtual reality company Oculus, which raised $2.4 million for the Rift headset in a Kickstarter campaign.

Instead of compensating ZeniMax for the use of its intellectual property, the company recruited its employees, including Carmack, to join Oculus.

The lawsuit alleges that the defendants misappropriated ZeniMax’s trade secrets and infringed on the copyright of the “Doom 3” computer program and other code.  It also claims that Luckey and Oculus violated a non-disclosure agreement with the company and that Carmack breached his employment agreement with ZeniMax, copying thousands of documents from a company computer on a USB device.

The case, ZeniMax Media Inc. v. Oculus VR Inc., is in the U.S. District Court for the Northern District of Texas.

Photo: Oculus founder Palmer Lucky is surrounded by photographers after introducing the Rift virtual reality headset during a press event in San Francisco on June 11, 2015. (Karl Mondon/Bay Area News Group)


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