Mark Zuckerberg Testifies in $2bn Oculus Rift Lawsuit

Mark Zuckerberg Testifies in $2bn Oculus Rift Lawsuit

Facebook CEO Mark Zuckerberg was in court on Tuesday to refute claims that the virtual reality headset manufacturer acquired by his company in 2014 used stolen technology for its Oculus Rift device. The $2 billion trial in Dallas federal court is in its second week.

The 32-year-old was called to the witness stand by ZeniMax Media, an American media company that develops and publishes video games. The dispute started more than two years ago when ZeniMax sued Oculus just months after Facebook announced that it would acquire the start-up.


TESTIMONY

"The idea that Oculus technology is based on someone else's is just wrong."

Mark Zuckerberg told the court that, at the time of the acquisition, he was not aware of any theft claims against Oculus. He said the technology was not even fully formed when his company agreed to buy it.

Improving on that technology doesn’t make it yours,” ZeniMax lawyer Tony Sammi countered. "If you steal my bike, paint it and put a bell on it, does that make it your bike?"

The lawyer also questioned whether Facebook rushed through its review of Oculus when buying it. Zuckerberg had previously said that the Oculus deal was done over a weekend in 2014, which Sammi said did not show sufficient due diligence. In response to this, Zuckerberg said that the company spends weeks, months or even years thinking about the issues that lead it to make acquisitions. But he believes that negotiating deals quickly is important in an extremely competitive business environment.

He also revealed that the Oculus acquisition was more expensive than the $2 billion price tag indicated. It does not factor in the $700 million spent to retain employees and $300 million in payouts for reaching milestones. Oculus originally wanted $4 billion, he said. He added that Facebook probably will have to invest more than $3 billion in the next decade to reach its goal of bringing VR to the masses.


COMPUTER FILES


One of the key points of the case is ZeniMax’s claim that Oculus VR poached one of its star designers. John Carmack is an American game programmer that worked for id Software LLC before that company was acquired by ZeniMax. He is now the chief technology officer at Oculus.

Carmack admitted in testimony last week that he copied computer files containing work he did at ZeniMax when he left the company. But he denied using the material in his work for Oculus and credited Oculus founder Palmer Luckey with developing the prototype for the Oculus Rift.

Zuckerberg told the court that three days after meeting Carmack in March 2014, he put plans in place to purchase Oculus. Tony Sammi put it to Zuckerberg that the acquisition was delayed a day because Carmack was concerned he might be sued by ZeniMax. Zuckerberg responded that the day-long delay came as a result of indecision at Facebook.

This isn’t the first time Zuckerberg has faced legal challenges. In 2006, he was deposed in a lawsuit filed by Cameron Winklevoss, Tyler Winklevoss, and Divya Narendra, in which the plaintiffs claimed that he knowingly stole intellectual property to create his social network.

It’s unclear what kind of implications this case could have on Facebook’s virtual reality ambitions. Mark Zuckerberg has spoken on numerous occasions about virtual reality as an important part of the company's future business.

The VR market is poised to experience a massive transformation over the next five years driven by advances in devices, apps, components, content, and broadband communication. According to the latest market research reports on the subject, global virtual reality revenue is forecast to grow 39% by 2021. Facebook’s competitors will be keeping a close eye on proceedings as they develop.

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