Facebook Takes £400 Million Hit Over VR Lawsuit

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Oculus co-founders found guilty of violating non-disclosure agreement with ZeniMax in the company’s early days

Facebook has been ordered to pay $500m (£394 million) in damages after a US court found the firm guilty of unlawfully using technology from video game developer ZeniMax.

A Dallas jury found that Facebook’s virtual reality subsidiary Oculus, which it acquired for $1.9 billion (£1.1bn) in 2014, violated the intellectual property rights of ZeniMax in order to launch its own VR headset.

Oculus said it was “disappointed” with the verdict and has vowed to appeal against the ruling.

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Oculus payout

Despite not being found guilty of stealing trade secrets, Oculus co-founders Palmer Luckey and Brendan Iribe were found to have violated a non-disclosure agreement (NDA) with ZeniMax as they built the early Oculus products.

As part of the ruling, Iribe and Luckey have been ordered to pay ZeniMax $150 million and $50 million respectively for false designation. Oculus will also have to pay ZeniMax $200 million for violation of the NDA,  $50 million for copyright infringement and $50 million for false designation.

Silicon has contacted Facebook and ZeniMax for comment.

The lawsuit gained publicity last month when Facebook CEO Mark Zuckerberg was brought in to testify, telling the court that the claims were “wrong” and that at the time of the acquisition he had “never even heard of ZeniMax before.”

And Facebook is not standing still on the VR front. Just last week it announced the appointment of former-Google employee Hugo Barra as its new Oculus head, as technology giants have quickly realised the potential that VR technology can offer.

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