The Wall Street Journal reports that ZeniMax Media, the parent company of Bethesda and id Software, is undergoing a legal battle with Oculus VR over the technology behind the Rift VR headset. The dispute goes back to early 2012 when John Carmack was still a programmer at id Software, and Palmer Luckey was working with a research group at the University of Southern California.
According to the report, Carmack demonstrated a modified headset at ZeniMax Media's booth during E3 2012. This device was essentially a pair of ski goggles with electronics held together by tape. At the time, Carmack said that he created software to make the device a working prototype. This demo took place around the same time Palmer Luckey founded Oculus VR.
ZeniMax now claims that this device was the template for Oculus VR's Rift headset.
Unnamed sources told The Wall Street Journal that ZeniMax began seeking compensation for the intellectual property in August 2012. For six months, the two companies negotiated, and ended when Oculus VR offered ZeniMax a small equity stake in the VR headset company. No deal was reached, the sources said.
Carmack joined Oculus VR in August 2013 while still working for ZeniMax Media, and eventually stepped down from his programming seat at id Software in November 2013 to work at Oculus VR full time.
During February 2014, Carmack was asked by ZeniMax Media to disclose all virtual reality inventions he developed while still employed at id Software. The paper didn't say what became of that request, but instead pointed out that Facebook announced a bid to purchase Oculus VR for $2 billion USD on March 25.
Over the span of several weeks, ZeniMax lawyers recently sent two letters to Oculus VR and Facebook, saying that Carmack "improperly took ZeniMax's intellectual property with him to Oculus VR. That technology helped push Rift from "a garage-based pipe dream into a working reality."
"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," an Oculus VR spokesperson told The Wall Street Journal.
We reached out to ZeniMax Media for a comment, and this is what the company provided:
"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."