Facebook’s Oculus ordered to pay $500m in ZeniMax court case

UPDATE: In a statement, a ZeniMax spokesperson said it may seek to halt sales of the Oculus Rift until the infringing code has been removed from the device.

The spokesperson said: “We will consider what further steps we need to take to ensure there will be no ongoing use of our misappropriated technology, including by seeking an injunction to restrain Oculus and Facebook from their ongoing use of computer code that the jury found infringed ZeniMax’s copyrights.”

Original story continues below…

Facebook owned Oculus has been ordered to pay $500m to Bethesda parent company ZeniMax Media, following a lawsuit alleging software used to develop the Rift headset had been incorporated without license.

A jury in Dallas, Texas made the award after determining Oculus founder Palmer Luckey failed to comply with a signed non-disclosure agreement, Polygon reports.

Related: Oculus Rift review

Oculus was found to be not guilty of misappropriating trade secrets, despite claims to the contrary from ZeniMax.

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As a result of the verdict, Luckey himself is on the hook for $50 million, while former Oculus CEO Brendan Iribe will have to pay $150 million.

ZeniMax lawyers had sought a whopping $2 billion in compensation and the same amount again in punitive damages, but today’s decision still reflects a significant judgement against Oculus.

The case, which was filed shortly after Facebook purchased Oculus for $2 billion back in 2014, centred largely around the role of Oculus CTO John Carmack.

ZeniMax argued software developed by Carmack while he was working at a company called id Software was integral to the Oculus Rift.

It also claimed his role in the creation of the headset constituted more than basic support and argued Oculus avoided signing a licensing deal for Carmack’s software.

Facebook is yet to comment on the case, but is releasing its quarterly financials later on Wednesday. We can probably expect something from Mark Zuckerberg’s company in the earnings call that follows.  

One thing’s for sure; Facebook’s purchase of Oculus VR just got far more expensive.

Will this verdict harm Oculus’ ability to be successful in future? Share your thoughts in the comments below.