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Facebook Ordered to Pay $500M in Oculus Lawsuit

variety.com

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Re: Facebook Ordered to Pay $500M in Oculus Lawsuit

#11

Post by [deleted] »

GauntletWizard wrote: post #8
MitchellKnight wrote: post #4

> However, the jury also found Wednesday that Oculus didn’t violate any trade secrets. Instead, it ruled that Luckey, who was working as a contractor for Zenimax before starting the Kickstarter for the Oculus Rift headset, violated his non-disclosure agreement, according to a Polygon report. I don't understand how this works. Why does Facebook have to pay $500M over an NDA violation between an individual and his prev…

Because Oculus (now part of Facebook) was built on the NDA breach. (It is the court's opinion that) Luckey misappropriated trade secrets, formed that misappropriation into Oculus, and then sold that to FB. IANAL, but I suspect it's a 'receipt of stolen goods' argument - FB should have known through it's due diligence that what they were buying was stolen property.

[deleted]

Re: Facebook Ordered to Pay $500M in Oculus Lawsuit

#12

Post by MikusR »

_m8fo wrote: post #9

Facebook bought Oculus for $3B [1] 16% of the purchase price for infringing on an NDA is pretty damaging. I believe that'll be a good deterrent in the future. [1] http://uk.businessinsider.com/facebook-actually-paid-3-billi... (thanks for the correction, Cozumuel)

Zenimax wanted 15% of company. 16% one time payment is cheaper.

Re: Facebook Ordered to Pay $500M in Oculus Lawsuit

#13

Post by AdmiralAsshat »

cptskippy wrote: post #3

The accusation that Palmer was incapable of creating the Rift without Carmack's help and that he had a barely functional prototype, if true, is pretty insulting to Carmack. Carmack is a smart guy and I every much doubt he'd have joined on at CTO if the prototype was as awful as ZeniMax says it was.

I don't think anyone is insulting Carmack. Quite the opposite, pretty much everyone knows that Carmack is an absolutely brilliant, world-class developer. You could easily make the argument that Carmack saw the prototype and was more excited by its potential than its present quality that drove him to sign on. Then, being Carmack, he alone had the technical chops to make it usable.

Re: Facebook Ordered to Pay $500M in Oculus Lawsuit

#15

Post by corysama »

> A Dallas, Texas jury today awarded half a billion dollars to ZeniMax after finding that Oculus co-founder Palmer Luckey, and by extension Oculus, failed to comply with a non-disclosure agreement he signed.

> In awarding ZeniMax $500 million, the jury also said that Oculus did not misappropriate trade secrets as contended by ZeniMax.

> Of the $500 million, Oculus is paying out $200 million for breaking the NDA and $50 million for copyright infringement. Oculus and Luckey each have to pay $50 million for false designation. And Iribe has to pay $150 million for the same, final count.

http://www.polygon.com/2017/2/1/14474198/oculus-lawsuit-verd...

Re: Facebook Ordered to Pay $500M in Oculus Lawsuit

#16

Post by kafkaesq »

Facebook's Sheryl Sandberg told CNBC's Julia Boorstin that she was "disappointed in certain elements of the decision." Sandberg added she was "considering our options to appeal," and the verdict was "not material to our financials."

Sure, FB has a lot of money. But still -- $500M is "not material" to their finances?

Re: Facebook Ordered to Pay $500M in Oculus Lawsuit

#17

Post by toyg »

MitchellKnight wrote: post #4

> However, the jury also found Wednesday that Oculus didn’t violate any trade secrets. Instead, it ruled that Luckey, who was working as a contractor for Zenimax before starting the Kickstarter for the Oculus Rift headset, violated his non-disclosure agreement, according to a Polygon report. I don't understand how this works. Why does Facebook have to pay $500M over an NDA violation between an individual and his prev…

TechCrunch says "Oculus pays $200M for NDA [breach of contract], $50M for false des[ignation], $50M for copyright [infringement], Luckey pays $50M false des, Iribe pays $150M false des" [1]

So it's more like FB/Oculus pay 300m, Luckey 50m, Iribe (former CEO) 150m. It looks like the judgement is against Oculus and their execs, which misrepresented what was sold to FB. It seems like they were found innocent of theft, which would have been more the more damaging charge going forward IMHO.

As it is, it's a big cash penalty and that's it; which could mean FB might choose to cut their losses and just pay, rather than risk going through an appeal.

[1] https://techcrunch.com/2017/02/01/jury-awards-zenimax-500-mi...

Re: Facebook Ordered to Pay $500M in Oculus Lawsuit

#20

Post by hkmurakami »

kafkaesq wrote: post #16

Facebook's Sheryl Sandberg told CNBC's Julia Boorstin that she was "disappointed in certain elements of the decision." Sandberg added she was "considering our options to appeal," and the verdict was "not material to our financials." Sure, FB has a lot of money. But still -- $500M is "not material" to their finances?

Related: I believe you can take offset such a settlement from profits to reduce taxes. Never really understood the rationale for this. Seems pretty arbitrary and another example of how corporations are often favored over humans.
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