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Facebook payout in Oculus copyright spat cut to US$250m

Dallas

FACEBOOK Inc won a ruling that halved a jury's US$500 million verdict against its Oculus unit for using computer code in its virtual reality headset that was taken from another company.

US District Judge Ed Kinkeade in Dallas also on Wednesday rejected ZeniMax Media Inc's request that he ban sales of Oculus headsets.

ZeniMax sued shortly after Facebook acquired Oculus in 2014 for US$2 billion. ZeniMax claimed it was responsible for key breakthroughs in the development of software and hardware for the headset, only to be betrayed when one of its star employees, John Carmack, joined with two other entrepreneurs and stole ZeniMax's intellectual property for their startup.

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Facebook chief executive officer Mark Zuckerberg has said that the company's bet on virtual reality as the next big computing platform will take years to pay off. Currently, the headsets are mostly popular among video game players - not the mainstream.

Judge Kinkeade affirmed the jury's February 2017 award of US$200 million for breach of contract and US$50 million for copyright infringement. He wiped out the other US$250 million awarded by jurors, including the damages against Oculus co-founders Brendan Iribe and Palmer Luckey.

A ZeniMax lawyer argued at a hearing a year ago that the Facebook unit was continuing to infringe its copyrights and "a permanent injunction is the only way to stop it." Oculus argued that a sales ban would place an unfair hardship on the company, its business partners and customers. The judge sided with Oculus. BLOOMBERG