From $4 b to $500 m to $250 m to ... : Bethesda / ZeniMax vs Facebook / Oculus lawsuit ends with Humiliation finisher

[Delicieuxz]

Remember ZeniMax' lawsuit against Facebook? That lawsuit saw ZeniMax, Bethesda's parent company (though Bethesda is the original company and created ZeniMax, I'm guessing to serve as a buffer against lawsuits), seeking up to $6 billion in damages from Facebook based on the allegation that former id Software owner and subsequent Bethesda employee (after he sold id Software to Bethesda) John Carmack stole ZeniMax' proprietary code and used it in the software for the Oculus VR headset.

 

In the original trial, ZeniMax lost all of their core arguments against Facebook and Oculus but the jury did decide to award them $500 million in compensation for Palmer Luckey's breach of an NDA and for false designation (which I think had something to do with Oculus using DOOM in a demo of theirs).

 

Quote

ZeniMax awarded $500 million judgment in Oculus lawsuit

 

"However, the jury didn’t find Oculus had misappropriated trade secrets, which it had been accused of by ZeniMax. As a result, the $500 million figure is much smaller than the $2-$6 billion in damages and $4 billion in punitive damages which were being sought by ZeniMax."

 

Facebook and Oculus are appealing the $500 million verdict: Oculus Vows Appeal of $500 Million Verdict, ZeniMax Threatens Injunction

 

John Carmack has given a public defence of himself, while suggesting that ZeniMax are liars. He said that ‘The Internet Would Have Viciously Mocked The Analysis’ in the $500 million verdict.

 

So, after the first trial was over, Facebook vowed to appeal the $500 million verdict. And they did, and they were successful in doing so, getting the $500 million verdict halved to $250 million:

 

June 2018: US Judge halves ZeniMax's $500m win in Facebook Oculus legal battle

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The ongoing battle between Facebook and ZeniMax Media continues as a US District Judge has revised the terms of the latter's earlier's win.

 

Back in February 2017, ZeniMax was awarded $500 million by a jury in Dallas, Texas but judge Ed Kinkeade has now ruled that the firm will receive $250 million, Bloomberg reports. The bulk of this - $200 million - is for breach of contract, while the other $50 million is for copyright infringement.

 

The case centres around a lawsuit filed by ZeniMax back in May 2014 - just a couple of months after Facebook acquired Oculus for $2 billion. The firm claimed Oculus stole trade secrets to create its Rift virtual reality headset, alleging that Palmer Luckey, former id Software exec John Carmack and other former ZeniMax employees reverse engineered research and copyrighted code for the project.

 

Oculus argued that this copyright infringement wasn't "substantial" enough to warrant the original $500 million, claiming that just seven lines of Oculus code had been copied from ZeniMax "out of approximately 42 billion lines".

 

Kinkeade seems to have agreed, dropping $250 million of the jury's proposed award for ZeniMax, as well as the damages specifically against Luckey and fellow Oculus co-founder Brendan Iribe.

 

In that appeals trial, ZeniMax had tried to get $500 million added to their initial $500 million award and an injunction against the selling of the Oculus VR headset. They also asked to get 20% of the profits of Oculus' future profits for the next 10 years: (June 2017) Injunction hearing started this week, with Zenimax asking for $500 million additional damages and a 20% cut of Oculus' revenue

 

Needless to say, ZeniMax didn't get any of that, and instead lost an additional $250 million from their initial $500 million award.

 

 

I'm guessing that Facebook planned to next appeal that $250 million verdict as the entire matter has now been withdrawn from the court entirely with ZeniMax and Facebook agreeing to settle out of court for an undisclosed set of money or terms.

 

December 2018: ZeniMax Agrees to Settle Facebook VR Lawsuit

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Game company ZeniMax Media said it is has agreed to settle litigation against Facebook, Oculus and individual executives alleging misappropriation of its virtual-reality technology.

Terms of the settlement were not disclosed.

 

...

 

Facebook did not immediately respond to a request for comment.

 

“We are pleased that a settlement has been reached and are fully satisfied by the outcome,” Robert Altman, ZeniMax’s chairman and CEO, said in a statement. “While we dislike litigation, we will always vigorously defend against any infringement or misappropriation of our intellectual property by third parties.”

 

In October, Carmack said he settled all litigation with ZeniMax, including his 2017 lawsuit against ZeniMax alleging the company owed him $22.5 million for the acquisition of Id. “Zenimax has fully satisfied their obligations to me from the purchase of Id Software, and we have released all claims against each other,” he said in a tweet.

 

That ZeniMax was willing to settle out of court at this point indicates that ZeniMax thought, or feared they would also lose the next appeals trial. After all, who withdraws from a $250 million lawsuit when they believe in their argument and think that they're going to win the case and get the full $250 million?

 

Also, despite ZeniMax saying they are now "fully satisfied" with the outcome, ZeniMax previously claimed each step of the way that their arguments were valid and that the verdicts in their favour (though they were actually for things that weren't a part of ZeniMax' original arguments) proved such. If ZeniMax believed their original arguments and their subsequent awards were legitimate, then how could they be fully satisfied with an outcome that comprehensively denies those original arguments and awards? Obviously, ZeniMax was unjustly fishing for cash anywhere they thought they could lie to get some and are now trying to save face with disingenuous PR statements that defy the reality of the outcome which is totally against them.

 

 

Personally, I think this outcome is deserved (providing not too much money was paid out) as I see Bethesda / ZeniMax as being one of the most evil and greedy companies in the games industry. If you're interested in why, I've put an overview of Bethesda / ZeniMax' history of cheating people and screwing other developers over with predatory practices, baseless accusations, and frivolous lawsuits into this post:

 

 

[mr moose]

Smart move, they already got the guilty verdict in court and having the out of court settlement means no public scrutiny and no appeals.

[S w a t s o n]

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claiming that just seven lines of Oculus code had been copied from ZeniMax "out of approximately 42 billion lines"

I really want to know what those 7 lines did if carmack felt the need to copy them instead of reengineering another solution. Also how do you even prove 7 lines out of 42 billion isnt coincidence.

Either way, not sure if I'm pleased that Facebook was able to win over Bethesda but we all love carmack so....it's fine i guess

[williamcll]

The lawyers are swimming in money right now.

[mr moose]

8 hours ago, Delicieuxz said:

You just copied Moose's answer.

 

To that, I would say: Besthesda already lost most of their arguments, including all their original and core ones, and so didn't get a guilty verdict for those - and the last verdict still standing for Bethesda was subject to another appeal, which is like saying that the verdict wasn't guaranteed.

 

What Bethesda did get from the original case is a jury award for relatively minor technicalities. Bethesda then lost a massive amount of their jury award in the subsequent appeals case. And then Bethesda accepted an out-of-court concession which means that Bethesda was concerned the remaining part of the jury award wouldn't stand up in court, either.

 

Here's what Bethesda had standing after the last appeals case: $250 million for breach of NDA and $50 million for copyright infringement of 7 identical lines of code out of a total of 42 billion lines of code.

 

And those things were subject to another appeals trial which would have happened if Bethesda didn't accept an out-of-court settlement. And accepting an out-of-court settlement means that Bethesda isn't going to get that much, but will receive a concession amount, whatever Bethesda and Facebook agree together upon.

 

 

I don't see settling out of court as making Bethesda look positively. I see it as a statement by Bethesda that they don't have confidence that their remaining jury award was going to hold up in the next round, and a clear admittance by Bethesda that they just want to secure whatever they can while they still have the chance to. I see it as an abandonment by Bethesda of their case and that it reveals that Bethesda's case was always trolling for money they knew they didn't deserve.

 

If Bethesda was confident in their case and that they deserved that $250 million + $50 million, then Bethesda wouldn't settle out of court but would see the case through to the end to get all of that money and be vindicated in the public's eye. I think that what Bethesda has done by accepting the other side's offer knowing that it might be their only shot at getting something decent out of the case, is like a burglar running away out the back door from a broken-into home with as much stolen goods as could be stuffed in their pockets while authorities enter in through the front door.

 

 

Bethesda's settling out of court at this point and after multiple losses of huge chunks of their arguments and jury award does the following:

 

- It shows that Bethesda isn't confident in their case and isn't confident that the remaining part of the jury award will make it through another appeal fully intact.

 

- It shows that whatever Bethesda was offered in an out-of-court settlement seems to Bethesda to be the best deal they're likely to get.

 

- It shows that Bethesda doesn't care about being justified in the public's view by a final court verdict and is only after money like a patent troll.

All that is assuming they got nothing in an out of court settlement, as I said, we will never know what they settled for nor will we know the likely direction an court appeal would have gone.    What they did get was the last word about who stole code regardless what price is on it.

[Guest]

11 hours ago, mr moose said:

All that is assuming they got nothing in an out of court settlement, as I said, we will never know what they settled for nor will we know the likely direction an court appeal would have gone.    What they did get was the last word about who stole code regardless what price is on it.

Time to let this thread rest ae

[mr moose]

1 hour ago, RorzNZ said:

Time to let this thread rest ae

I responded to a recent post which has now been deleted???

[W-L]

Please refrain from bumping or necroing older threads. 

 

-Locked-