Last month, Facebook paid $2 billion to acquire virtual reality startup Oculus VR, but now another company is claiming rights to the intellectual property that powers Oculus' flagship product— the Oculus Rift virtual reality headset, according to The Wall Street Journal.
Lawyers for ZeniMax Media, a major video game publisher behind massively popular titles such as "The Elder Scrolls" series, have sent two letters to Facebook and Oculus VR in recent weeks.
The letters alleged that former ZeniMax employee John Carmack, who joined the Oculus team in August, took intellectual property from the company with him to Oculus. ZeniMax is also claiming that this intellectual property is what propelled Oculus' success.
Here's Oculus VR's official statement concerning the matter:
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.
The letters from ZeniMax's lawyers came after Facebook placed its offer to acquire Oculus, The Wall Street Journal reports, although the publication doesn't specify a specific time frame. It's also unclear whether or not Facebook knew that ZeniMax was claiming intellectual property rights to the Oculus Rift before it made its bid to purchase the company.
According to the Journal, the dispute between Carmack and ZeniMax traces back to 21012. Carmack, who previously worked as a programmer for ZeniMax, contacted Oculus VR founder Palmer Luckey, who then sent him a headset prototype. That June, Carmack demonstrated a modified version of the headset at a gaming convention in Los Angeles, which ZeniMax now says was the template for the current version of the Oculus Rift.
In August 2012, ZeniMax began seeking compensation for the intellectual property, the Journal reports. Oculus eventually offered the company a small equity stake, but a deal was never finalized.
Facebook isn't offering any comment at this time. ZeniMax offered the following comment to Business Insider:
ZeniMax confirms it recently sent formal notice of its legal rights to Oculus concerning its ownership of key technology used by Oculus to develop and market the Oculus Rift. ZeniMax’s technology may not be licensed, transferred or sold without ZeniMax Media’s approval. ZeniMax’s intellectual property rights arise by reason of extensive VR research and development works done over a number of years by John Carmack while a ZeniMax employee, and others. ZeniMax provided necessary VR technology and other valuable assistance to Palmer Luckey and other Oculus employees in 2012 and 2013 to make the Oculus Rift a viable VR product, superior to other VR market offerings. The proprietary technology and know-how Mr. Carmack developed when he was a ZeniMax employee, and used by Oculus, are owned by ZeniMax. Well before the Facebook transaction was announced, Mr. Luckey acknowledged in writing ZeniMax’s legal ownership of this intellectual property. It was further agreed that Mr. Luckey would not disclose this technology to third persons without approval. Oculus has used and exploited ZeniMax’s technology and intellectual property without authorization, compensation or credit to ZeniMax. ZeniMax and Oculus previously attempted to reach an agreement whereby ZeniMax would be compensated for its intellectual property through equity ownership in Oculus but were unable to reach a satisfactory resolution. ZeniMax believes it is necessary to address these matters now and will take the necessary action to protect its interests.
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