Virtual reality nightmare: ZeniMax challenges Facebook, Oculus for Rift intellectual property

By Nicole Arce, Tech Times | May 5, 2:05 AM

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ZeniMax, Oculus in a Spat Over Rift

ZeniMax is claiming intellectual property rights to Oculus’ hot new product Rift, a virtual reality headset that is set to make waves in the mainstream market this year. Facebook, of course, is smack right in the center of the dispute after bidding $2 billion for Oculus.
(Photo : Global Panorama)

Facebook is at the front and center of what could turn out to be an ugly legal battle after ZeniMax Media, parent company of Id Software, sent the social network a legal notice claiming at least part of the intellectual property rights to Rift, a virtual reality headset developed by Oculus VR.

In March of this year, Facebook shook up the technology industry by announcing its plans to spend $2 billion to acquire Oculus, a virtual reality company that rapidly went from fledgling startup to Silicon Valley hotshot in less than two years. The acquisition has yet to be completed, but the Federal Trade Commission has already handed the deal its blessing.

According to ZeniMax, Oculus chief technological officer and former ZeniMax employee John Carmack, a celebrated game developer known for pushing the boundaries in games such as "Doom" and "Quake" used proprietary technology developed and owned by ZeniMax to develop Rift. Carmack stepped down from ZeniMax after his former employer allegedly wanted him to stop working on the company's own virtual reality projects.

"ZeniMax provided necessary VR technology and other valuable assistance to Palmer Luckey (founder of Oculus) and other Oculus employees in 2012 and 2013 to make the Oculus Rift a viable VR product, superior to other VR market offerings," claims ZeniMax in a statement provided to Engadget. "The proprietary technology and know-how Mr. Carmack developed when he was a ZeniMax employee, and used by Oculus, are owned by ZeniMax."

In the legal notice sent to Facebook and Oculus, which was acquired by the Wall Street Journal, ZeniMax alleges that Carmack shared position-sensing techniques and software to correct image distortion with Oculus, all of which are owned by ZeniMax.  

For its part, Oculus is quick to deny ZeniMax allegations and flings the accusations back at the video game maker, which is stepping up the pressure reportedly due to Facebook's $2 billion purchase of the company.

"It's unfortunate, but when there's this type of transaction, people come out of the woodwork with ridiculous and absurd claims. We intend to vigorously defend Oculus and its investors to the fullest extent," an Oculus representative told the Journal.

Carmack, however, did not beat around the bush.

"No work I have ever done has been patented. Zenimax owns the code that I wrote, but they don't own VR. Oculus uses zero lines of code that I wrote while under contract to Zenimax," writes Carmack on his Twitter account.  

The dispute dates back as early as 2012. Carmack was said to be browsing 3D gaming forums when he chanced upon Palmer and his prototype of the Rift headset, which was nothing more than a pair of Oakley ski goggles with a generous helping of silver duct tape to attach various computer parts to the frame.

Carmack asked for a prototype and Luckey, then a student at the University of Southern California's Institute for Creative Technologies, gladly obliged. Seemingly impressed, Carmack took the headset and debuted a slightly modified version of the prototype at the Electronic Entertainment Expo gaming conference in Los Angeles in June 2012.

A YouTube video of an interview with Carmack shows him saying he incorporated a new software to help make the headset a workable virtual reality product, and it is this software that ZeniMax seems to be laying its claim to.

ZeniMax reportedly granted Carmack permission to work with Luckey, on the provision that both Carmack and Luckey sign a non-disclosure agreement prohibiting Carmack from sharing work being done for ZeniMax.

"Nothing in this agreement is intended or shall be construed as a transfer, grant, license, release, or waiver of any intellectual property rights in any proprietary information," says the agreement.

Based on the Journal, ZeniMax and Oculus have been privately wrangling since August 2012, three months after Carmack's E3 presentation made a hit with the gaming industry as well as the press. It is unclear however, if Facebook was aware of the dispute before it finalized acquisition talks with Oculus.

Oculus also reportedly offered ZeniMax equity ownership, but ZeniMax refused on the grounds that the single-digit equity offered by Oculus was inadequate. The refusal came only one month after Oculus became a major hit on Kickstarter, with as many as 9,000 backers pledging $2.4 million, well above the startup's goal of $250,000.

Oculus has made about $25 million from sales of its Rift developer's kit and aims to release a consumer product version of its headset sometime this year.

Facebook spokesperson Michael Buckley declined to comment. 

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