Facebook Ordered to Pay $500 Million in Lawsuit

Feb 1, 2017  •  Post A Comment

A recent acquisition by Facebook appears to have just cost the company another $500 million. TechCrunch reports that Facebook’s Oculus subsidiary and its executives were ordered to pay a total of $500 million in a lawsuit filed by ZeniMax Media.

A jury in Dallas reportedly ruled that Oculus founder Palmer Luckey violated the terms of a non-disclosure agreement, and found Oculus guilty of charges related to false designation and copyright infringement.

TechCrunch adds: “Oculus was notably found not guilty on charges related to claims by ZeniMax that the company stole trade secrets to create the Rift headset, Polygon reports.”

Luckey was reportedly ordered to pay $50 million in the suit, with former Oculus CEO Brendan Iribe on the hook for $150 million.

“Facebook is now telling TechCrunch that ZeniMax Media was actually seeking a reported $6 billion in this case, not the $4 billion that was previously reported,” TechCrunch notes. “Given the maximum possible penalty, this obviously isn’t the worst possible outcome for Facebook, a company that is likely able to view a $500 million judgment as a slap on the wrist, especially given the resources they have been devoting to their virtual reality efforts.”

In an official comment on the decision, Facebook said: “The heart of this case was about whether Oculus stole ZeniMax’s trade secrets, and the jury found decisively in our favor. We’re obviously disappointed by a few other aspects of today’s verdict, but we are undeterred. Oculus products are built with Oculus technology. Our commitment to the long-term success of VR remains the same, and the entire team will continue the work they’ve done since day one — developing VR technology that will transform the way people interact and communicate. We look forward to filing our appeal and eventually putting this litigation behind us.”

A rep for ZeniMax indicated the company was “pleased” with the ruling, adding that ZeniMax is looking “to ensure there will be no ongoing use of our misappropriated technology, including by seeking an injunction to restrain Oculus and Facebook from their ongoing use of computer code that the jury found infringed ZeniMax’s copyrights.”

Facebook acquired Oculus for $2 billion in 2014.

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