Gamasutra: The Art & Business of Making Gamesspacer
View All     RSS
September 18, 2014
arrowPress Releases
September 18, 2014
PR Newswire
View All





If you enjoy reading this site, you might also want to check out these UBM Tech sites:


5 points to help you better understand Zenimax's suit against Oculus
5 points to help you better understand Zenimax's suit against Oculus
May 21, 2014 | By Alex Wawro

May 21, 2014 | By Alex Wawro
Comments
    62 comments
More: Console/PC, Production, Business/Marketing



Earlier today Zenimax Media and its subsidiary id Software filed a lawsuit in federal court against Oculus (which now includes id co-founder John Carmack) plus its founder Palmer Luckey, and the details of the case are complicated.

Zenimax alleges that it provided Oculus with intellectual property and expertise from its employees, most notably from Carmack, under the terms of a non-disclosure agreement that forbids anyone from using it without approval from Zenimax.

The company further alleges that Oculus violated that agreement multiple times, most notably in March when it announced plans to be acquired by Facebook to the tune of roughly $2 billion in cash and stock.

Zenimax wants some of that money, and it's now demanding a trial by jury to determine whether or not its claims hold up in court. In an effort to better elucidate the issue, we've taken the liberty of reading through the legal complaint and highlighting some of Zenimax's notable allegations against Oculus.

Zenimax paints Palmer Luckey as an inexperienced college kid who'd be nowhere without John Carmack -- and Zenimax

According to the complaint, Zenimax claims to have entered into the NDA with Luckey after it devoted significant time and resources to helping him get the Rift into a state where it could be showcased at E3 2012, then helped to do so by booking appointments for then-Zenimax employee John Carmack to show it off at the show.

According to Zenimax, Luckey was just a "college-aged video game enthusiast" when he sent a "crude prototype" of the Rift to Carmack, who then proceeded to significantly improve it with help from other Zenimax employees.

"Those Zenimax employees literally transformed the Rift by adding physical hardware components and developing specialized software for its operation," reads the Zenimax legal complaint.

"At QuakeCon, Oculus, lacking sufficient virtual reality expertise, could not get the modified Rift to function properly without ZeniMax’s technical assistance," reads another portion of the complaint, alongside this photograph of Carmack helping Luckey with the Rift prototype during QuakeCon 2012.

Zenimax says it owns Carmack's work on VR

Zenimax claims that Carmack agreed to cede ownership of all copyrightable works he produced while working for Zenimax when the company acquired id Software in 2009, and thus Zenimax has a claim on the work he did for Oculus while still employed at Zenimax.

To back it up, Zenimax went ahead and reprinted a relevant portion of his employment contract in the complaint.

Zenimax says Oculus' Kickstarter success was made on the back of Zenimax tech

The complaint also points out that the original Kickstarter video for the Oculus Rift identifies “ultra-low latency head tracking” as “the magic that sets the Rift apart.”

Zenimax claims ownership over the head tracking technology referenced in the video, and thus claims that Oculus owes the success of its Kickstarter directly to Zenimax.

Furthermore, it claims that Luckey featured clips of the VR edition of Doom 3: BFG Edition in the Oculus Kickstarter video and promised copies of the game to Kickstarter backers without the approval of Zenimax.

The legal complaint does highlight efforts by Carmack to prevent Luckey from using Zenimax IP in the Rift Kickstarter campaign. "It is very important that you NOT use anything that could be construed as Zenimax property in the promotion of your product," Carmack allegedly advised Luckey. He also allegedly declined Luckey's request to appear in the Oculus Kickstarter video.

Zenimax says it wanted to invest in Oculus, but Oculus evaded talks

Zenimax alleges that it repeatedly requested meetings with Oculus to discuss "working together more closely" and establishing a potential partnership in the wake of Oculus' successful Kickstarter campaign, but that Oculus repeatedly side-stepped or delayed those meetings while continuing to use John Carmack's name to advertise the Rift and give demos of the VR version of Doom 3: BFG Edition without approval from Zenimax.

Zenimax claims it sought an equity stake in Oculus so that it could profit from its contributions to the Rift, and that Oculus responded by offering Zenimax unsatisfactory deals that caused the relationship between the two companies to degrade. At one point during negotiations, Oculus allegedly claimed Zenimax's proposal was “so far out of the ballpark, we’re left wondering if there’s any hope."

Zenimax provides multiple examples of how Oculus executives allegedly impeded the progress of investment negotiations in the complaint, and offers email correspondence documenting Oculus employees' continued requests for technical aid from Carmack despite the "issues" that were brewing between executives of both companies.



When negotiations between the two companies proved unsatisfactory to Zenimax, the company claims to have told Carmack to stop sharing proprietary information or technical assistance to Oculus "until a satisfactory business agreement could be reached" between the two parties.

Zenimax claims Oculus poached employees to access Zenimax trade secrets

Carmack joined up with Oculus last August and was legally forbidden from recruiting former Zenimax employees for two years after his departure. Zenimax claims that he may have breached that agreement when five of his former coworkers resigned from Zenimax simultaneously in February to go work for Oculus.

According to Zenimax, "at least one of the resigning employees refused to certify to Zenimax upon his resignation that all Zenimax confidential information in his possession had been returned to Zenimax."

And the list goes on. We've taken the liberty of publishing the full legal complaint filed by Zenimax below, so you can check it out for yourself. It's worth a read.

ZeniMax v Oculus Complaint_As Filed_21-May-2014



Related Jobs

Mixamo
Mixamo — San Francisco, California, United States
[09.18.14]

Animation Outsource Manager
Phosphor Games Studio
Phosphor Games Studio — Chicago, Illinois, United States
[09.18.14]

Game Producer
Trion Worlds
Trion Worlds — Redwood City, California, United States
[09.18.14]

Senior Gameplay Engineer
Heavy Iron Studios, Inc.
Heavy Iron Studios, Inc. — Los Angeles, California, United States
[09.18.14]

Game Programming Intern










Comments


Daniel Lau
profile image
And just when we had a growing conversation at "http://www.gamasutra.com/view/news/218252/Zenimax_officially_sues
_Oculus_over_virtual_reality_tech.php," Gamasutra threw up this new post.

Dane MacMahon
profile image
We all wondered whether Carmack signed a standard employment agreement of that nature. I guess now we know.

George Vazquel
profile image
This is likely one of those cases where state law is going to be rather important.

California, in particular, has laws aimed at preventing non-compete agreements. As for Texas and Maryland, I have no idea.

Daniel Lau
profile image
Getting fellow employees to leave a company is a, "non-interference," agreement, not a non-compete agreement. Those are legal, even in California. Also, "non-compete" clauses are not enforceable for the period after an employee leaves a company. It is enforceable while an employee of a company. So Carmack may have been bound by a non-compete clause while an employee of Zenimax, although I don't see anything above that refers to such a clause. What I do see is a, "work for hire," clause which basically says that Zenimax owns any IP that Carmack developed while an employee. Of course, none of these apply after Carmack left Zenimax. In this case, Zenimax is arguing about IP passed to Oculus while Carmack was still their employee.

Michael Kelley
profile image
Noncompetes can be comprised of many different agreements many of which can/are of course enforced after an employee leaves a company. In fact;

"...while you are still working for the employer a non-compete clause likely does not have any impact on your life. Non-compete clauses are generally intended to protect an employer’s interests after an employee leaves, whether the employee is fired or resigns."

http://employment-law-firm.com/non-compete-agreements/life-after-
non-compete.html

That's the whole point of a noncompete. For when the employee leaves the company.

SD Marlow
profile image
Yeah, I would not be shocked by a $1.2B court ruling for Zenimax. Carmack was "this" close to having the kind of VR gear he wanted (having burned thru many available examples) when Luckey dropped the exact piece of hardware he was looking for into his lap.

I liken it to building your dream car, and having the guy that brings the final part jump-in and take your baby for a joy ride.

Michael Joseph
profile image
Was Carmack working on VR before he signed with Zenimax? Maybe he will claim that he invented this tech before that and only finally had the right hardware w/ the Rift to make it feasible. But even then, did Zenimax acquire all of that when they bought id.

That said, I think describing Luckey as a college-aged video game enthusiast is funny. I was just a college-aged video game enthusiast once upon a time. Now i'm an above college-aged video game enthusiast! Luckey had to have been a lot more than that to create a working VR headset prototype.

James McDermott
profile image
Zenimax calling Luckey a "college-aged video game enthusiast" was intentional as was the language which followed in my opinion. From what I can tell, they're trying to paint Luckey as an incompetent flunky whose 'work' is nothing more than stolen intellectual property from people who knew better. As the original Occulus Rift dev unit demonstrated, however, Luckey is far from incompetent.

Terry Matthes
profile image
I agree 100% I would gather that Luckey is smarter than the majority of the people pursuing this frivolous suit. Furthermore I believe that John Carmack's involvement was personal and his improvements to the Rift had nothing to do with Zenimax. He wrote code on his own time to fix the image bending caused by the magnifying lens in the Rift.

Here's a great read from Wired on how the Occulus Rift came to be...
http://www.wired.com/2014/05/oculus-rift-4/

SD Marlow
profile image
About an hour of pre-trial testimony... via Carmack himself: http://youtu.be/wt-iVFxgFWk?t=59m40s

Also, Carmack didn't take a leave of absence to work on VR tech. He was "at id" doing research.

Daniel Lau
profile image
(To Terry Matthes) There is no way to differentiate Carmack's personal time from his Zenimax time, and the, "work for hire," clause addresses that by saying that any work that Carmack does, while a Zenimax employee (while at home, work, or sitting in his car at a traffic light), that is related to games belongs to Zenimax. Any professional working today for even a moderate sized company is likely to sign similar agreements. And I challenge anyone working in games to really look at your contract and see that you have some form of work for hire clause.

Aaron Eastburn
profile image
I can attest to them being in the contracts at the game companies I worked at. I have always felt that something more akin to a right of first refusal as publisher with well defined terms would be much better for both parties.

Terry Matthes
profile image
Thanks for the clarification Daniel. It's unfortunate if that's the case.
I had a thought, and I might be way of base here, but could Carmack be sued for not letting Luckey know about this?

Carmack doesn't seem like the type of person to play along with Corporate shenanigans, but It's quite unfortunate for Luckey if Carmack came across as wanting to help and then ended up losing him the better part of his invention.

James McDermott
profile image
@SD Marlow I would ask one question then: if the law is seemingly on Zenimax's side in this suit, why does Zenimax seemingly attempt to discredit Luckey using the language they do when they describe him as a "college-aged video game enthusiast" in the suit?

John Paduch
profile image
In light of these new details, it doesn't sound so "frivolous" to me. I think we all need to be very, VERY careful to not allow our emotions or personal inclinations toward one company or the other distort our outsiders' view of these very serious legal proceedings.

I know almost everyone is knee-jerk-inclined to side with Occulus - because they're the cool, new underdog bringing about the "second coming" of video games, versus the sue-happy corporate entity Zenimax (/sarcasm) - but we have to remember that A)Nothing is that clean-cut and simple, B)The Occulus folks are people, too, and just as capable of under-handed behavior as any corporate suit, and C)None of us are privy to everything that transpired between these two groups.

Daniel Lau
profile image
To James, I've done a lot of patent litigation, and I've seen this before where lawyers seem to take pot-shots at each other in their responses to one another, knowing the documents will be reviewed by a judge. The lesson I learned from all this is never refer to another lawyer's opinion as being, "erroneous." They really seem to hate that word. Getting back to your point, there has been a lot of responses between these two sides that is starting to get personal. And this is probably some of that starting to percolate. I suspect Occulus will have a few choice words for Zenimax shortly. Probably something along the lines of, "Zenimax is full of &!%#" So I would take Paduch's comments above as particularly on point.

James McDermott
profile image
Agreed, John. That's why I'm asking the questions and saying the things I am - not only do I want to enlighten myself with more informed opinions, feedback, and criticisms from others so I can better see how everything fits, I also want to challenge the opinions of others so they'll hopefully get to converse in a more diverse way and, well, THINK outside of their pre-existing presumptions, like the prevalent one you mentioned.

For example, while I certainly agree that Zenimax has a strong case given that John Carmack has a "work-for-hire" clause which makes any work during his work hours the property of Zenimax - which his Occulus Rift work falls under - it seems odd that Zenimax is using seemingly-discreditory language to describe Luckey (see this article's first point). If this is indeed the case, then in my mind, to discredit your opponent when they already lack the grounding needed to have a serious chance at success is unnecessary and, furthermore, indicates one has a bit of hubris.

James McDermott
profile image
Daniel, thank you for your reply. While it still doesn't make much sense to me why you'd want to take pot-shots in a legal case - after all, isn't part of the point of a legal case to find the truth behind the arguments presented? - your response clarifies things.

Also, I do apologize if I implied Zenimax or Occulos Rift was in error - that wasn't the point of my statements or questions; rather, I was trying to make sense of what seemed to me as an odd statement through seeking a response by more knowledgeable such as yourself.

TC Weidner
profile image
@Daniel
There is no way to differentiate Carmack's personal time from his Zenimax time, and the, "work for hire," clause addresses that by saying that any work that Carmack does, while a Zenimax employee (while at home, work, or sitting in his car at a traffic light), that is related to games belongs to Zenimax.

-------------------------------

I dont think that is nearly as cut and dry as you seem to think it may be. There are ways indeed to differentiate it, and that is what a court and judge will be asked to do.

I think the key phrase in the work for hire clause is " related to company business or current or anticipated R&D" , is VR related to company business, it would seem so, but then again was/is ZMI/ID planning on releasing VR Hardware? It will be a very interesting court battle if it ever comes to that. And as I mentioned below, in the US, even if you have a good case, sometimes it doesnt matter if you are going against a defendant with unlimited funds. They'll drag it out and bleed you dry well before a court date

Daniel Lau
profile image
Its cut and dry in the sense that Zenimax doesn't have to show that JC was sitting in his office when this happened. Zenimax simply needs to find an email dated during the period when JC was a Zenimax employee and with source code in it. They can then compare that code to any or all of Occulus' source code base during discovery, the part of the trial where the two sides share information. Zenimax also seems to be claiming that there were public events where Zenimax clearly shared their VR knowhow and that knowhow remains part of the headset. As far as bleeding you dry, read my comments below regarding contingency firms.

Christopher Landry
profile image
@ James: Regarding the use of ad hominem attacks, I think you're projecting your own intellect and logical reasoning ability onto the general public.

From what I can tell of your points so far, you're above average intelligence and an above average critical thinker. This means that, by definition, there are more people in this world that have more difficulty than you have with working out whether or not the evidence itself is worthy of merit.

There are, by definition, as many people with below average intelligence as there are people who are above average. These people are more susceptible to putting their trust in the validity of personal attacks such as the one used here.

A good lawyer will cover all of their bases wherever possible. Some of the jury will be above average intelligence and see the evidence first, and for those, the evidence is laid out scrupulously. Some will be below average intelligence and only see the personalities involved, which means they are listening more to the personal attacks than to the actual evidence.

Daniel Lau
profile image
@ James: I didn't mean to imply that you referred to either Zenimax or Occulus as being, "erroneous." I was only relating a personal anecdote. As for the truth, lawyers do want to win, and just like athletes talk trash to one another, so do lawyers.

Colin Clark
profile image
The employment contract is between Carmack and Zenimax, not Zenimax and Occulus. Occulus agreed to nothing, signed nothing.

Zenimax claims they own what Carmack did. But did Carmack ever own what Carmack did? If he didn't establish his ownership of the work (eg contract with Occulus), then his work was a gift.

Mike Wikan
profile image
ZMI is on very strong legal ground here. Oculus/Facebook will settle.

TC Weidner
profile image
ZMI will have a hell of a time proving exactly what if anything was stolen or legally theirs IMHO. It is one if an employee receives a patent or releases a commercial product while in their employment using their assets, its quite another if they are simply helping and having conversations with others.

So according to ZMI , are all the professionals out there under these stupid contracts not allowed to give advice or constructive feedback to friends, family, or colleagues?

There isnt even a commercial product yet from Occulus? just a lot of expenses.

Its all too murky IMHO, sounds like sorry grapes to me. Would of been wiser to do this lawsuit before one of the richest companies in the world bought up Occulus, now you going from fighting a cash strapped start up, to a behemoth. Facebook lawyers can drag this out for years and bleed ZMI dry in lawyers cost and fees. Discovery in something like this is a nightmare.

Terry Matthes
profile image
"So according to ZMI , are all the professionals out there under these stupid contracts not allowed to give advice or constructive feedback to friends, family, or colleagues?"

This is what I have a hard time understanding. If you work for Zenimax any work you do with friends or family is partly owned by Zenimax?

I find the idea of working under a contract like that disgusting. It's a "legal" way of enslaving your mind. Not only that but they actually then get a shot to worm their tentacles into the works of your friends and family if you help them. It's audacious at best and intellectual slavery at worst.

TC Weidner
profile image
@Terry, yeah its kinda getting ridiculous out there. A lot of it comes down to how broad words like " related to " becomes.

Tyler King
profile image
@Terry many companies have something like that. My current company is not in the games industry but I have to get express written consent to even work on games on the side for myself. If I don't or they don't consent and I keep going forward they can, at least try to, take ownership of what I made. Regardless of if its related or not, or was on my own personal time or the companies.

Dane MacMahon
profile image
@ Terry and TC

Those contracts are disgusting, but people sign them, so what is a company's motivation to stop using them? Unless people take a stand and refuse, sacrificing a better job to do so, nothing will change. Obviously people are willing to sign it in exchange for the position.

Daniel Lau
profile image
The non-complete clause clearly sucks for those experts such as myself who want to do outside consulting; however, its common practice at this point. Do you remember the episode of the Office where Michael needs extra cash, so he takes a job at a telemarketing firm and then his boss tells him he has to quit? If you really don't like it, then do what many developers have done in the past, quit your current employer and start your own company.

If Zenimax has an email with source code from Carmack to Occulus that was then cut and pasted into Occulus' code base, then Occulus has a problem. Let me refer you to the San Francisco Canyon lawsuit and how that cost Microsoft over $100M. And as far as sharing advice with friends, I hate to say that behavior could be a problem, depending on your employer.

As for suing Occulus before they had Facebook backing, let me refer you to my earlier post that prior to the Facebook deal, I doubt Zenimax could have found a contingency law firm (only get paid if they win, and even then, payment is based on award) to share the financial burden of the lawsuit unless a deep pocket was on the other end, and now Facebook is on the other end. So I doubt Zenimax's legal fees are going to be anything near what Facebook will pay since they will have to pay their lawyers by the hour, not on contingency. From my very limited experience with patent suits, I would suspect that Occulus will pay five times more to defend themselves than Zenimax will pay to prosecute. Consider this, Apple has been reported in news recently to have faced more patent lawsuits than any other corporation in the United States in 2013. Isn't Apple a big corporation that could drag lawsuits on for years, and bleed anyone dry?

TC Weidner
profile image
if its a contingency law firm, they are insane, they will bled dry then, or simply try to get a quick settlement, and if/when Facebook tells then to take a hike, the lawfirm bails.

and as you say, if they can show cut and paste source code to and from ZMI to Occulus they may have something, but then again, good luck in discovery, and since Occulus isnt even a commercial product yet, Occulus could simply change the source code. They havent made a dime off it yet.

ZMI , you win, here's a dollar.

As for Facebook, I'm sure they have top lawyers in house or on retainer. Their cost are already fixed for the most part.

As for Apple, your talking patents lawsuits, different area, and you think they settle easily and dont drag things out? With patents often plaintiffs have no other option other than sue, that or simply lose their patent.

Daniel Lau
profile image
Perhaps, but there are a lot of IP law firms out there that do extremely well with this business model of partnering with companies like Zenimax and then sue deep pocketed companies like Facebook. Some are even publicly traded. And while there may not be a patent in question, there are clearly instances of intellectual property that Zenimax will argue is theirs, and that is the realm of patent lawyers. Regardless, we can speculate back and forth all day, but as things look, we are going to see a lawsuit unfold in front of our eyes. And I'm sure many lessons will be learned.

James McDermott
profile image
The question I would ask is this, then: when was is the Occulus Rift's source code made available to developers? Furthermore, was it initially hosted on a repository which logs user and admin actions?

If the source code was made shortly after the release of the DK1 and it was hosted on a repository, then it would make it easier to prove either side's case. Also, presuming - and only presuming - the source code was made available shortly after the release of the DK1, having that initially-available source code missing or modified would be quite damning to Occulus as it would be somewhat (if not very) easy to add destruction or tampering of evidence to the list of charges.

SD Marlow
profile image
@ McDermott - Carmack did the low-level stuff id's games ran on, but a "formal API" for a dev kit is built on top of that, so it doesn't matter how much later, or by whom, it was written. Saying "source code" is so Hollywood.

What we are talking about is the firmware/drivers that allow the Rift to even work in the first place.

SD Marlow
profile image
Haven't made a dime? Kickstarter aside, Facebook handed them 200 million dimes!

Carmack has stated that the code used to fix the lens distortion in the Rift was written while he was testing some VR projection hardware while with id. All of the tracking and latency issues, also critical to VR, was also work done by Carmack prior to Luckey sending him the Rift prototype.

Carmacks office was piling-up with 10's of thousands of dollars worth of prototype VR gear before he ever contacted Luckey.

TC Weidner
profile image
Revenue= o, Capital investment= lots of dimes. Creative accounting can make the books these days say whatever they want them to say pretty much.

As for" All of the tracking and latency issues, also critical to VR, was also work done by Carmack prior to Luckey sending him the Rift prototype." was that stuff patented? if not then we are back to the clause iii of the work for hire contract.

This case is far from open and shut, and when billion dollars companies are involved, my experience is to always bet on those with the deepest pockets....its the american way...

SD Marlow
profile image
*face palm*
Carmack is a creative type and doesn't want to patent anything, but it is still research being done on the companies dime (some would say capital investment).

Albert Thornton
profile image
Saying "these contracts are disgusting" is rather small-minded and selfish. Most laws evolve as the result of previous clashes. For example, a lot of companies have tried to take game ideas from enthusiastic fans with the promise that the 'winning' idea will be made. Ended up in a lot of heartbreak and lawsuits as people who submitted entries later claimed their ideas were 'stolen' (no matter how generic or commonplace those ideas were). So companies had to start saying that anything you submitted to them became their property.

Similarly, we have become an industry. We are no longer hobbyists loosely associating for mutual benefit. For most of us, a company has decided to assume all the risk of the business and pay us a steady salary plus benefits. Before these clauses were in place, many companies had to deal with their employees using the company's resources and time to work on personal projects. This led to some bitter and angry fights. So companies started outright saying: if you work for us, you cannot compete with us.

You are completely right to say that if you dislike these agreements you are free not to enter into them. I have seen people successfully negotiate away the specific clause, or just walk from the contract.

But pretending that companies do it because they're "evil" is just more of the same childishness that has us calling one political ideology "evil" and the other "good". It helps nobody.

TC Weidner
profile image
Regardless, we can speculate back and forth all day, but as things look, we are going to see a lawsuit unfold in front of our eyes. And I'm sure many lessons will be learned.
-----------------------------------------------------

I agree, personally I dont care who really wins, although those work for hire contracts clauses dont sit well with me.
Also I think ZMI is trying to save face a little IMHO, I guess they dont want to go down in history with Excite and Yahoo who balked at buying google for a under a million, or the dozens of publishers that all told JK Rowling to take her boy witch story somewhere else..

Daniel Lau
profile image
For those naysayers out there, I dug this quote up from an NBC News article first reporting Carmack's transition from Zenimax to Occulus. The quote reads, "I have fond memories of the development work that led to a lot of great things in modern gaming — the intensity of the first person experience, LAN and internet play, game mods, and so on. Duct taping a strap and hot gluing sensors onto Palmer's early prototype Rift and writing the code to drive it ranks right up there." Can anyone reasonably say that your employer wouldn't be a little bit upset if they found out they were paying your salary to work for someone else? If anything, I can understand John's frustration when Zenimax decided to pull the plug on any and all support for VR gaming. And it easily justified his leaving Zenimax, but that alone can't justify Zenimax losing out on its investment of company resources into Occulus.

TC Weidner
profile image
decided to pull the plug on any and all support for VR gaming

---------------------------------
and we are back to the "related to" clause. Might of been their second giant mistake. First is not buying or partnering with Occulus when it had the chance, second was to pull itself out of the VR business ( and there fore weakening their case)

The software industry is filled with companies giving away the store and not knowing it. Apple and Microsoft may well of never become household names in Xerox didnt give them "windows".

SD Marlow
profile image
@ Weidner
1. They DID try to work with Luckey/Oculus prior to the Kickstarter campaign.

2. Zenimax is not a hardware company but that doesn't forfeit their right to work on VR technology (be that games or software drivers).

Daniel Lau
profile image
If you read the documents from Zenimax, they tried to invest in Occulus but were repeatedly thwarted. It sounds like they pulled all support simply because they wanted to cut off all access to their IP since Occulus was jerking them around. They obviously didn't think John would jump ship, choosing to go to Occulus instead of sticking with them. I'm sure there will be an airing of the emails between John and Zenimax just prior to John leaving. As for Xerox and Windows, are you saying that because we have Apple and Microsoft, then this kind of stealing of IP is okay?

Michael Joseph
profile image
Maybe Zenimax "resources" went into Occulus and that legally entitles them to something.

But I think the amount of resources is absolutely negligible. Use of a computer that's already there? Use of electricity? Use of internet bandwidth? Use of office space that's not going to be used by anyone else when Carmack is not sitting in his chair? Lost productivity? I tell you what, an employee who wants to be working on something else is going to be just as unproductive whether he's working at home and then "mailing it in" at the office or whether he's using "company resources" and splitting his time between authorized tasks and unauthorized ones.

So I get they have a legal right, but Zenimax has lost next to nothing resource wise. Right now in a parallel universe there is a John Carmack who took precautions and worked on the Rift hardware at home on the down low. He quit Zenimax and was hired by Occulus and no legal complaint was ever made.

So when it comes to these evil contracts, the moral of the story is AT HOME, IN TOTAL SECRET (no matter how "cool" you think the higher ups are), and then WAIT some months after quitting before unveiling your new project.

Daniel Lau
profile image
What are you talking about? John gets paid a salary. So him working for Occulus is time (i.e. money) that he should be spending on Zenimax projects. One could argue that Rage failed to live up to expectations because John was more interested in VR then putting out the best Rage product he could.

But you're right. Had John done the dishonest thing, he should have never openly revealed that he was working with Occulus, and there wouldn't be this trail of evidence supporting Zenimax's assertion that it was mostly their resources poured into Occulus that won the Facebook investment.

SD Marlow
profile image
@ M. Joseph
PLEASE watch the video I linked to further up in the comments. For about an hour Carmack tells the full story, and his/id's/Zenimax's involvement is anything but "negligible."

Michael Joseph
profile image
I understand. Company "resources" means human beings. And John Carmack using his own mind is using company resources. I suppose that should have been obvious to me, but that sort of MBA thinking doesn't come automatic for me.


Christian Nutt
profile image
Look, we can debate the ethics of companies claiming ownership of anything anybody does when they work for them whether or not they're at work, because that is pretty gross -- but if Carmack was sitting at his desk at Id during work hours and spending time on non-Id work, I think anybody could understand why that's problematic. I don't go to work and do work for another company, and I'm guessing neither would you!

I'm not saying that Zenimax is in the right here, but I think we tend to get into the weeds a bit sometimes on things that are a bit more basic.

Dane MacMahon
profile image
Also whether we agree with those contracts or not he seemingly signed it, and Oculus is work in video games while working for Zenimax, so that seems pretty clear cut. Oculus now have to prove none of that work is relevant to their current business, which seems... far fetched? Assuming Zeni have what they say they have.

Travis Flynn
profile image
Seems like that's a good basis for a non-compete suit or conflict of committment issue with Carmack, not particularly with Oculus or Luckey.

also they didn't try to invest in Oculus. They demanded a large share of the company in exchange for whatever they were offering them at that point. They scoffed at 2% ownership interest and demanded an undisclosed amount, which Luckey, et. al. found to be outside the realm of reality.

Michael Joseph
profile image
"I don't go to work and do work for another company, and I'm guessing neither would you!"
--

@Christian Nutt
I think you've phrased that in a somewhat biased way. I don't think people intend to put themselves in that situation from the outset but it happens all the time. And it's ok. We're human beings, not machines and the world doesn't run like a strict game of monopoly (although not for lack of trying.)

Anyone who works two or more jobs regularly winds up doing some work or preparation related to one or more jobs while at a different job.

Yes, the law is very clear, but some laws are made to be bent...as are some contracts. Some folks live in apartment buildings that forbid the consumption of alcohol. The majority of those tenants signed their rental agreement with the intent of breaking at least that particular clause. Everyone believes that the clause is designed as an excuse to evict the "other guy." With contracts, sometimes it's worth the risk to see if they'll go after you or can catch you. Now wait... that is exactly the position corporations take. For them, sometimes breaking the law or breaking a contract is a calculated business decision where the rewards clearly outweigh the risks.

Now John Carmack isn't necessarily an example of the suffering and sorrow of the human condition and of the working stiff trying to squeeze 28 hours into 24, but he's a human being and that means from time to time he needs to find ways to keep his work morale high. Computer programmers know how rejuvenating it can be to put aside the marathon project for a time and work on something fun instead. Doing what you need to do to stay productive and useful is part of the job.

But what should it matter (ethically) what he's doing, when he's doing it or where he's doing it? Christian, while at work have you ever updated your resume and cover letter? Ever engaged in a phone interview for another job? Take a time-out to jot down some ideas that just sprang to mind for that "Great American Novel" you've been kicking around in your head? And maybe that time-out turned into 60 minutes? And maybe it happened more than a few times.

People aren't machines that only do authorized work at work. Sometimes people will have a bad day and they will go through the motions just to make it through the day. Some people will duck out of work early because they need to be somewhere. Are they being dishonest to their employer by not putting in a full day of solid effort? Yes. So what. It happens. It's ok. Some weeks they're going to get 120 hours worth of work out of you in just 60 hours. Sometimes they'll only get the 60. Sometimes they'll just get 30.

I'm not trying to sound like the delinquent teenager who's trying to turn the mild mannered honor roll students into truants and petty criminals. I'm saying that while employees play by one set of rules, the entities they work for are playing by another. And maybe individuals need to view their employee contracts the same way their employers do... shrewdly and with more of a legal eye than a moral one.

Zenimax may be legally entitled, but so far it sounds to me like they don't actually deserve to benefit here.

Daniel Lau
profile image
@ Michael Joseph, Watch the Youtube link provided by SD Marlow above and you'll see that Carmack was doing a lot more to support Occulus than update his resume. From everything that's been posted, JC was a huge fan of the idea of VR, but it wasn't until he saw the Occulus headset that he saw a complete path forward. He then poured his Zenimax sponsored time into Occulus, not just an hour here and there to fight boredom but his heart and soul effort. And he did it with Zenimax's blessing since they had the NDA in place. I think the deal simply went sour when Occulus refused to sell a portion of their company to Zenimax. John had to choose between his employer and the project he so desperately cared for.

And what Christian wrote is correct, most employers require their employees to sign fairly draconian contracts, but because they don't enforce them stringently, like lettings employees update their resumes now and again, most employees are willing to view contracts as just some abstract artwork they have to deal with; however, if they sign it, they very well could find their company's legal team contacting them if they independently publish the next, "Flappy bird." Hey, if you don't like it, don't sign it. And good luck finding a job when you tell the recruiter that you want special treatment negotiating your contract. For a Ken Levine or John Carmack, I'm sure they'll get this treatment, but for most everyone else, they won't have any choice.

Michael Joseph
profile image
@ Daniel Lau

I'm less interested in the Carmack situation and more interested in how people view these "draconian contracts."

"Hey, if you don't like it, don't sign it."

No. I say if you don't like it and still want to win, go ahead and sign it and then game it. Why? For precisely the reason you mentioned... they're difficult to avoid, people are EFFECTIVELY FORCED into selling off their rights, and so dealing with them has to be treated like a game. And know there's nothing wrong with doing so. You don't win in these situations by being the only nice guy in the competition. Play the game the way they play it.

The other side expects their employees to be soft. Employees should understand that they too can play hardball.

And I think it's absolutely the wrong advice to tell employees they should be soft in the face of a ruthless opposition. Let's drop the double standard.

Daniel Lau
profile image
Let me just say that, "gaming the system," sounds like just another way to say, "be patently dishonest," or, as an academic might say, "behave unethically." I wouldn't recommend that approach for any student of mine. And there is a reason why employers check a person's employment history and ask for references. If an employer thinks your gaming them, they will fire you. And you will have to carry that baggage to your next employer and the one after that.

Michael Joseph
profile image
I'm sure you wouldn't recommend it. That's why I am. There is a context to what I'm talking about that you're obviously disinterested in. I'm talking about surviving and even thriving in environments where unethical practices have been instituted at the very top and which affect the very low the most. I have no qualms with employees who game systems that are gaming against them. Even as a state of mind, it keeps one alert so that they perceive opportunities that a "nicer guy" would miss.

Bill Gates didn't get to where he is by being nice or by acting like Mary Poppins. Neither did Bezos or Jobs. My position is that I'd like to see more of that done by people entering corporate workplaces at the bottom but who have aspirations of climbing the ladder. And you almost have to have this ambition now because there is very little job security at the bottom. In the game, pawns just get gobbled up and spit back out.

If you want to be in those systems and you want to thrive in them, then you have to adopt a game theory mentality. And yes, it is game theory type thinking that allows a corporation to conclude that the risk of getting caught (and of being proven guilty) dumping toxic waste in the middle of the ocean is sufficiently low enough to warrant the illegal activity. These system are moral vacuums (amoral) and exist to play and be gamed.

Personally I have no interest in being apart of any that. But people can only really have choices when they fully understand all of the implications of their options. You can't have that when people continue to have these childish fairy tale views of the world.

"Be nice and play by the rules or you'll be punished!" is not the type of advice that demonstrates deep respect for your fellow human beings. A five year old deserves better than that. Instead you teach them how virtuousness begets real strength, power, and self determination.

Daniel Lau
profile image
Perhaps you should submit your own blog to Gamasutra explaining your views. And if you do, then maybe you'll start a long set of comments and generate some thought provoking posts.

Michael Joseph
profile image
I prefer to continue doing what everyone else is doing which is to reply to articles/blog posts and user comments that I find funny, interesting, or important. Whatever views I have will come out in replies within the context of those articles and any subsequent discussion.

Daniel Lau
profile image
Don't forget, Occulus and Zenimax had an NDA. So Occulus can't claim ignorance.

Travis Flynn
profile image
The most curious things about this complaint aren't really pointed out.

The first one that strikes me is the breach of contract claim. Essentially they claim that Luckey breached the NDA by disclosing the know how gained from ZeniMax to Oculus. Then, in the next claim they claim that Oculus was bound by the terms of the NDA. But I don't see how they can even argue this in the alternative. If Oculus is party to the NDA agreement, Luckey can not breach the NDA agreement by disclosing the supposed secrets to Oculus. And that's aside from the fact that calling Oculus a "third party" in terms of entities disclosed to is sort of nonsensical, as for all intents and purposes Luckey is Oculus.

The second thing that stands out is the trade secret misappropriation claim. Zenimax repeatedly states that they disclosed know how to Luckey under NDA's and then claim that Luckey used said know how for non-"proper purpose," which is defined, but never described in the complaint. In essence the claim essentially is that any use of Zenimax' know how counted as an impermissible use, which kind of raises the question as to why Zenimax would disclose the information to Luckey in the first place, if he was not allowed to use the information in any way. They literally claim that usage of the trade secrets in developing, designing, testing, or demonstrating the Rift was an impermissible use of the secrets. Which leaves me wondering - what would a permissible use of the secrets be under the NDA?

The final thing that stood out about the whole complaint was the argument that Oculus misappropriated trade secrets by hiring former employees of Zenimax. As far as I know, this has been eliminated as a legal theory.

A real curiosity about this whole complaint is that Carmack is not a named party, and Carmack is constantly described in the complaint as Zenimax, when the crux of much of the complaint is that it was unfair competition for Carmack to join Oculus. It doesn't make a lot of sense to try and sue Oculus for secrets taken to it by former employees (other than for the unjust enrichment portion) but not name former employees. It makes the legal theory for the case seem weak, and the reason for not naming Carmack is probably political in general (they don't want a reputation for suing former employees).

The copyright and trademark claims seem somewhat strong, and probably the strongest part of the complaint.

Daniel Jackson
profile image
The verdict in this suit is, hopefully, going to have to answer one question: is VR hardware a part of id Software's business, or are they a game design company?

If it can be proven that developing a VR headset for someone else is a conflict of interest for the Tech Director at id, then Zenimax should be able to prove damages.

If, on the other hand, a court rules that id software is a game company which frequently collaborates with hardware manufacturers for mutual benefit (games that better implement the hardware features, and hardware that better implements the game features) then it looks like Zenimax is just an overreaching corporate owner not satisfied with just (trying to) make games.

I think a large part of that ruling has to be influenced by the other work John Carmack has been doing over the years--obviously his contract excludes work he does with Armadillo Aerospace, but what about the code he wrote for gyros that he carried over to his VR testbed?
Can Zenimax claim that code is game-related and thus falls under the contract? What about work on drivers?
The latency mitigation strategies they claim were such an essential part of Carmack's contribution to the Rift... why did they allow him to publish a whitepaper on them? If they agreed to allow it because they didn't see it as information they needed to keep proprietary, why not?

As others have said, the NDA Palmer Luckey signed and the way id Software collaborated with Oculus *only* make sense (to me) given the premise that id was trying to make Doom3/RAGE/future games the killer app for the Rift, and they wanted Oculus to have all the resources available to leverage that.

If the premise is that Carmack was secretly developing a revolutionary VRHMD but gave up on Zenimax as a boss once he realized that Palmer Luckey had better connections to display OEMs and other suppliers... how does that make any sense?

Zenimax turned what was a collaborative partnership between the brightest minds in the industry (and could have resulted in huge numbers in sales if they refocused their efforts on developing software to go with the latest hit in hardware) into a pissing match. They lost good employees over it, and I really do hope they lose this case. I'm not dumb enough to expect it'll be easy, but I really do think Oculus should fight this.

Albert Thornton
profile image
I also have to say: "Went ahead and reprinted"? I imagine that the author of this article attended some form of post-secondary education with an emphasis on writing. This is the result?

Matt Wilson
profile image
I thought the interesting part was ZMI citing a tweeted complaint by Carmack about re-implementing code to avoid this very issue, as proof.


none
 
Comment: