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Facebook Ordered to Pay $500M in Oculus Lawsuit

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

#21

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 it was the prototype itself that was barely functioning, it was the software side that wasn't great. I remember when Palmer first showed off the device, it seemed to track just fine. When they introduced actual content, though, it became disorienting really quickly. I backed them on Kickstarter so I got to see the DevKit1, DK2, and the CV1. The difference between the early versions and the end versions…

Personally I have no interest in Oculus and it's equal parts Facebook and the vendor lock-in BS.

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

#23
post #12
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.

Nice to have a tax write-off too for FB. (Settlement sums can be offset against profits iirc)

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

#24

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?

The company may have already reserved 500M for a potential resolution and took the hit in a previous quarter. This is typical of many companies, which is why you sometimes see stock prices rise after a legal settlement that comes in much lower than anticipated.

For example, suppose they set aside 1B legal reserve for this case. That hit was already taken. Now they would reclaim 500M of that, which would be accretive.

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

#25

Good to hear that the jury made the right decision on the ridiculous charges against Carmack. Sad to hear that they think a bunch of litigious assholes deserve $500 million for getting a signature on an NDA.

Litigious or not, that's how intellectual property works. It's pretty clear that ZeniMax tried to reach some kind of agreement and no common ground was found.

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

#26

Earlier quoted context omitted.

I don't think it was the prototype itself that was barely functioning, it was the software side that wasn't great. I remember when Palmer first showed off the device, it seemed to track just fine. When they introduced actual content, though, it became disorienting really quickly. I backed them on Kickstarter so I got to see the DevKit1, DK2, and the CV1. The difference between the early versions and the end versions…

Personally I have no interest in Oculus and it's equal parts Facebook and the vendor lock-in BS.

Oh, don't get me wrong. I'm never buying an Oculus product again, I'm just saying that I completely understand the accusation that the Rift was nothing without Carmack.

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

#27
Large fines like these, even if the facts are clear, do not support competition and seem anti-consumer and anti-innovation. Either the fines should be smaller or the laws changed to better balance what concretely happened: a poaching of a key employee that led to the development of a big product.

That being said, Facebook doesn't really seem to have its R&D figured out. It's poisoned by bad leadership. Palmer Luckey managed to disgrace himself in public opinion in a way that seems hostile to recruiting the kind of progressive, free-thinking talent that makes up most R&D teams. John Carmack, besides his political leanings, speaks derisively of "Hollywood people" (Oculus users) and came out of this lawsuit looking like a real jerk chasing a huge check at any cost. At the end of the day, he betrayed a video game company.

Mark Zuckerberg has a lot of leadership faults disguised behind an amateurish ownership structure that puts him outside of public accountability. Despite its huge head start, Oculus is seriously threatened by HTC, Sony, Google and Samsung. Paper and Facebook payments didn't really go anywhere. Though Instagram and WhatsApp seem to be good acquisitions, even at their extraordinary prices, a broken clock can still be right twice a day. And it doesn't really take leadership to spend huge amounts of money on acquisitions—that's the easy way out. Outside of Facebook, his New Jersey schools efforts were not well regarded. Will his $3 billion commitment to a SF Biohub be marred by similar issues? I'm just nervous is all.

I think market sentiment will catch up with this ruling. Eventually someone's going to ask if he's the right guy to be in charge of Facebook. The public investor may never actually have the power to do something about it.

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

#28

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.

[deleted]

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

#29
post #18

This wasn't something I knew, but it appears that Carmack used to indirectly work for Zenimax, who became the parent company of id.

It wasn't indirect, by any means. Carmack was working on a VR version of Doom 3 (the BFG Edition) while working at id/ZeniMax before he jumped ship to go work at Facebook. There's still tons of remnant news stories about the Doom 3 BFG VR Edition that was supposed to launch with the CV1 Rift.

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

#30
This whole situation leaves me with a bad taste in my mouth regarding Zenimax.

So their biggest claim, surrounding Oculus being built on trade secrets, is found false but they get a half-billion dollar payout anyway?

Considering the purported fines could be traced back all the way to practically the original Kickstarter...I wonder if Zenimax would have gotten such a sum had Oculus not been bought by FB for $3B[1]...

...or am I misunderstanding something?

[1] http://www.businessinsider.com/facebook-actually-paid-3-bill...

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