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Oculus fires back at Zenimax in virtual reality dispute
Oculus fires back at Zenimax in virtual reality dispute
May 5, 2014 | By Kris Graft

May 5, 2014 | By Kris Graft
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    31 comments
More: Console/PC, Business/Marketing



The battle over virtual reality technology between two game industry heavyweights is just getting started.

A representative for Oculus sent along a longer statement Monday morning, refuting Zenimax’s recent claims that Oculus illicitly acquired proprietary technology when it hired game programming luminary John Carmack as its chief technology officer.

Zenimax is the parent company to Bethesda Softworks, developer and publisher of the popular Elder Scrolls and Fallout franchises. Oculus is the hot VR startup that was acquired by Facbook for $2 billion earlier this year.

Zenimax believes it deserves a piece of the VR pie. Word came out last week that Zenimax lawyers contacted Oculus and Facebook’s lawyers, saying that Carmack’s work with VR happened while he was still an employee of Zenimax, allegedly making that work property of Zenimax.

"We are disappointed but not surprised by Zenimax’s actions and we will prove that all of its claims are false,” the Oculus rep stated Monday. He went on to address specific claims made by Zenimax’s lawyers:

There is not a line of Zenimax code or any of its technology in any Oculus products.

John Carmack did not take any intellectual property from Zenimax.

Zenimax has misstated the purposes and language of the Zenimax non-disclosure agreement that Palmer Luckey signed.

A key reason that John permanently left Zenimax in August of 2013 was that Zenimax prevented John from working on VR, and stopped investing in VR games across the company.

Zenimax canceled VR support for Doom 3 BFG when Oculus refused Zenimax’s demands for a non-dilutable equity stake in Oculus.

Zenimax did not pursue claims against Oculus for IP or technology, Zenimax has never contributed any IP or technology to Oculus, and only after the Facebook deal was announced has Zenimax now made these claims through its lawyers.

Despite the fact that the full source code for the Oculus SDK is available online (developer.oculusvr.com), Zenimax has never identified any ‘stolen’ code or technology.

Zenimax is seeking compensation, though there's no official word yet on whether court proceedings will ensue.


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Comments


Rob Wright
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This is so f'd up. Whatever happens with this case, I get the distinct feeling that id Software is going to be a major casualty. Now that Carmack and Hollenshead are gone, I wouldn't be surprised to see more departures from the team, leaving ZeniMax with the company name and IP and little else. Hope I'm wrong.....

Dane MacMahon
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As soon as Rage came out and underperformed I think Zenimax decided the IP was all they got.

Rob Wright
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Ouch.

Hard to argue with that....which begs the question -- is this ZeniMax's way of trying to get something more out of that id acquisition?

Michael Wenk
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Re/Code has a take that this is Zenimax punishing Oculus VR for spurning them.

A W
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I think this predates even RAGE. I don't know how Doom 3 did but I do know there was a lot of noise about it not being that great of a game, and then there was Quake Wars, which was just not that good at all on the console front. I can't remember if Id and company where working for Zenimax at the time of those two games, or if they needed major funding because of those to disappointments. But I do remember being surprised when Carmack made a deal to sell himself and Id to help develop the next Doom. All I know is being disappointed with the short comings of RAGE given the ambitions they had going for it as a multi PC / console launch, but I kinda always knew in the back of my mind that it was really just a test piece for the next Doom or Quake they planned to cook up.

Dane MacMahon
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Zenimax bought them during Rage's development. Also Doom 3 was a massive sales and critical success. It's only years later that people suddenly act like that game was always terrible.

I think one big disappointment in the "blockbuster" space is enough nowadays though, and Zenimax likely drastically changed their opinion of what they bought once Rage came out. I remember id touting Zenimax's "hands off" approach with Bethesda, but I would bet that approach only lasts as long as the hits keep coming.

Benjy Davo
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Indeed Rob, Tim Willits in particular as a long time colleague and friend of John Carmack is in the weirdest position imaginable. It does make you wonder what the rank and file staffers such as Todd Howard, Pete Hines, Harvey Smith and co think about all this.

SD Marlow
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Both sides are splitting hairs on this... Only legal question is this: does Zenimax have legal rights to the IP of John Carmacks "side projects" when he worked for them (which would also include Armadillo Aerospace tech). Best account for what was going on, in his own words (about 35 minutes worth) http://youtu.be/wt-iVFxgFWk?t=59m40s

Rob Wright
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A proper contract with Oculus -- or even some negotiations about potential profit sharing or IP rights --would answer that question. If there isn't any of that, then I'm not sure what ZeniMax hopes to achieve with this suit. If they were concerned about Carmack working for another company and not getting anything out of it, then 1) they should have objected to BOTH of Carmack's side gigs, and 2) fired him if they couldn't come to some kind of financial agreement. But it doesn't sound like any of that happened.

Daniel Lau
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I can't imagine that any employer would let their employees work on outside projects without claiming ownership of any or all IP developed by that employee. May John has a different agreement because of his reputation, but Oculus should have expected that any and all conversations with John would have created this conflict of interest. Personally, I am in total agreement with Zenimax that, as John's employer, they have every right to expect John to owner his IP agreement with them, and unless Oculus can show that it had no reason to expect Zenimax to claim ownership to John's IP, then they get what they deserve. I think it is best stated this way, "you get what you pay for." If you didn't pay John for his ideas from the very beginning, you shouldn't expect to get his IP.

Keith Parsons
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Shouldn't the bourdon be on zenimax to prove that it's entitled to john's ip developed outside of work hours? Why would the employers rights come before the employee.

John Trauger
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It's not a question of whose rights come first. As the plaintiff, Zenimax has to prove their claims. the civil variation on "innocent until proven guilty".

Much will turn on Carmack's employment contract with Zenimax and/or the agreement selling Id to Zenimax.

Personally, it sounds like Zenimax is trying to grab a piece of the Occulus pie without having to invest a proportionate amount of money in the product.

In fairness to Zenimax, one must note that Occulus', carefully-worded statement does not dispute the assertion that Carmack may have worked on VR technology, now in Occulus, on Zenimax' dime, only that Carmack did not take any Zenimax IP with him out the door.

Daniel Lau
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Are you really suggesting that John works on an hourly rate and not a fixed salary? Are you really suggesting that Zenimax would have an IP agreement with their employees that says only if the idea was conceived while you were in your office does it belong to us? Not to be insulting, but that's not how IP agreements work. A standard agreement would basically say that any and all IP that an employee develops belongs to the employer regardless of when or where they conceived the idea. In fact, a standard agreement might not even explicitly say that the IP has to be related to game technology. Now as far as winning their case, Zenimax will have to show proof that any IP they claim ownership of was developed, at least in part, by John. And that's why they are suing, so they can stand up in a court room and make their case. I look forward to seeing the countless emails they probably have between John and Oculus. Emails they have right to read since John was their employee.

Keith Parsons
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I am a salary employee with no such IP agreement. I just don't like the idea someone would claim ownership of ideas developed outside of work and unrelated to my job is all. In John's case maybe he did have some kind of IP agreement but given that he is know to build rocket ships in his spare time maybe his was a bit different than the norm.

John Owens
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Whether you like it or not Keith, Daniel is right and this is important to remember if working on your own side projects.

Think of it this way, if you where an employer wouldn't you want your employee focused on the work you pay him for? Good ideas just don't come at certain times of the day.

Daniel Lau
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Keith, I don't want to imply that you are a liar or undermine you in any way about not having an IP agreement, but I absolutely refuse to believe that any salaried or even an hourly employee that doesn't have an IP agreement. I'm certain you will agree that you signed a contract of some sort, and my only guess is that you just haven't read it in detail. Even if the agreement says you can own your IP, there is no way an employer's lawyers would let that company hire anyone without some mention of IP. I suggest you look at your contact, and look for the words, "work for hire."

Ken Carpenter
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Of course almost all employees have an IP agreement, but if you signed one that gives away your ownership of everything you do outside of work, then you're crazy.

I have an IP agreement, but it is restricted to work I do for the company directly and for things that are in their direct line of business. I make games on the side, but I made damned sure my day job isn't entitled to any of them.

Ken Carpenter
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In John's case, if he had a similar agreement to mine, the rocket stuff is clearly different than the id stuff. The VR stuff, however, could be argued to be in the same line of business, which would be a very different story.

Yama Habib
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"Despite the fact that the full source code for the Oculus SDK is available online (developer.oculusvr.com), Zenimax has never identified any ‘stolen’ code or technology."

Bam, right in the common sense.

It's rapidly appearing as though the only legal grounds from which Zenimax can argue their claims would be if they can materialize a contract *signed by John Carmack* that clearly states that any and all software developed by Carmack in or out of his roles working under Zenimax are the intellectual property of Zenimax.

If not then this case is nothing more than the legal equivalent of schoolyard name-calling. "The only reason HE got two billion dollars is because he copied MY answers!"

Daniel Lau
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John might have a special agreement because of his reputation as a game designed; however, I've never heard of an industry contract that doesn't require an employee to sign over their rights to any and all IP they develop while an employee. We're not even talking about a non-complete clause, which I suspect Zenimax could also cite if John signed such an agreement.

John Owens
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It still doesn't matter.

Oculus could reasonably assume that John was in a position where he could authorize and act on Zenimax's behalf when giving them the code. Their issue if with anyone is with John.

Daniel Lau
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I have to disagree with you, and as my proof, I'll just cite the infamous San Francisco Canyon Company. The short version is that SFCC copied Apple source code for Quicktime into a video codec they were building for Microsoft. MS was then on the hook to Apple, ultimately settling at $150 million, you know that strategic investment that they made in 1997. But that aside, reading alternate posts you will see that Oculus and Zenimax had signed an NDA that clearly defines the relationship between Zenimax, John, and Oculus. Sadly, that NDA is no longer available on line. If anyone grabbed a copy before it was pulled down, I'd love to get a copy via email.

Marvin Papin
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Take a jury, show them the Oculus before carmack joined and after the end of the contract with zenimax...
Carmack is probably good but did not make the two years old work in 3 months.
Add to that the jurisprudence problem and they will only be able to sue Carmack for having worked on Oculus before the end of the contract and if they got evidences. But if they do that, I'm sure they will have some problems to find competent devs.

But anyway. Is Zenimax building a notoriety like King's one ? Plus the infamous "Scrolls" law action. Sad.

Michael Wenk
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I strongly suspect this won't go to a jury and FB will pay of Zenimax a bit. If it does make it a jury, I don't know. It will depend strongly on what contributions Carmack made while he was at Zenimax. It will also depend on jury instructions on how the law applies to this case. I sure wouldn't bet on Oculus as a sure thing now, which is why I suspect this will get settled.

Michael Thornberg
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If Mark Zuckerberg buys Zenimax and shut them down, simply because they pissed him off; I would be laughing. Not that I am a supporter of him, because I am not. But they should know whom they are messing with. His temper isn't exactly unknown.

A W
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Don't you have to buy things that are for sale Michael? If it isn't for sale how do you then buy it?

Michael Thornberg
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I'm sure Mark got enough information of where to hurt them. Should he want to. I was of course speaking metaphorically.

Alan Barton
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"If Mark Zuckerberg buys Zenimax"

All that would happen is the staff would loose their jobs ... Meanwhile the directors of Zenimax would be laughing, as they would get to walk away with millions.

It is the directors and not the staff who are the real problem here. They sound ruthless. Looks like we are finally getting to the real relationship John Carmack had with them before he left ID. Doesn't sound like it was a happy place to work.

Ryan Christensen
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Zenimax did not think this through, Carmack and Oculus are near and dear to game developers and gamers hearts. This short term undeserved money grab will harm their brand, I personally don't want to buy a game from people that take from the ones that helped enrich them. They stopped VR development and it is one of the reasons Carmack left. While I love their games and companies they have acquired, they are acting bratty in this situation to the wrong people. See Respawn as an example of what happens when you let greed push away skilled creators who are at least partially responsible for the success of products.

Benjy Davo
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To be fair I don't think Carmack yielded them much success considering Rage didn't do all that well. However I do agree going after a beloved geek in front of other geeks in such a petty way really does hurt their image. To be fair it didn't stop them going after Notch either so clearly they aren't put off by that. You get the sense that they have hired some overly aggressive lawyer type who is trying to make a name for themselves in their current job.

Alan Barton
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@"You get the sense that they have hired some overly aggressive lawyer type"

The CEO of Zenimax is a lawyer. Apparently he worked for the failed BCCI bank ... Not a good company to have on your CV! ... At least thats what it says here...
http://en.wikipedia.org/wiki/Robert_A._Altman

Its worth reading it, because if what is says there is true (disclaimer I'm not a lawyer) but if the details of that page are true?, then it helps explain a lot about Zenimax.


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