Source: https://ja.scribd.com/document/321898098/Zenimax-v-Oculus-Amended-Complaint
Timestamp: 2019-04-21 08:32:07+00:00

Document:
Zenimax has filed an amended complaint that directly names Facebook, Oculus CEO Brendan Iribe, and Oculus chief technology officer John Carmack. The suit also now accuses Carmack of theft.
code, trade secret information, and technical know-how.
around, as they do in real life.
the user’s action and the corresponding change in display.
reality headset that he called the “Rift,” which featured a display with a wide field of view.
creating an immersive virtual reality experience.
Carmack and other ZeniMax personnel added numerous improvements to the prototype.
components and developing specialized software for its operation.
Luckey pursuant to a Non-Disclosure Agreement that ZeniMax had entered into with Luckey.
added to the modified Rift headset. and its employee Carmack. 9. within the booth of ZeniMax’s subsidiary Bethesda Softworks. Oculus used ZeniMax’s hardware and software technology to create a software development kit (“SDK”) for the Rift and to develop. 8. 4 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . at ZeniMax's cost. ZeniMax scheduled appointments with a wide variety of industry and traditional media outlets to promote its new virtual reality technology. Carmack gave demonstrations of ZeniMax’s virtual reality technology. Based on those demonstrations. Luckey formed his company – then called Oculus LLC – to commercialize the Rift. as well as Carmack’s public support and ZeniMax’s marketing efforts. Luckey recognized the extraordinary value that ZeniMax.5 . ZeniMax employees arranged those demonstrations by appointment only. a global leader in interactive entertainment content. and directed its development. Only days after the E3 Convention. as well as program code that allows utilization of the hardware’s functions. and tune the Rift hardware. ZeniMax designed the specifications and functionality embodied in the Rift SDK. Subsequently. Luckey did not have the expertise or knowledge to create a viable SDK for the Rift. Luckey also recognized the skyrocketing interest in and public support for virtual reality technology that had been generated by ZeniMax.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 4 of 60 PageID 21175 Page 4 of 60 PageID 19516 did not know how to create software needed for a VR presentation. at the Electronic Entertainment Expo (“E3”) industry convention held in Los Angeles in June 2012. modify. ZeniMax’s heavily-modified Rift and its related virtual reality technology attracted considerable acclaim and attention. An SDK permits programmers to make use of new hardware by providing the technical specifications by which a computer communicates with that hardware. a uniquely experienced and widely acclaimed programmer.
In the months following E3. Page 5 of 60 PageID 21176 Page 5 of 60 PageID 19517 Throughout 2012. and indeed Oculus never provided ZeniMax with any compensation whatsoever." 11. 5 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . modify. 12. Luckey. others. Iribe privately directed Luckey and other Oculus employees to continue to obtain ZeniMax's hardware and software technology from Carmack. Oculus and ZeniMax entered into discussions regarding how Oculus would appropriately compensate ZeniMax for the use of ZeniMax’s intellectual property in the modified Rift and related virtual reality technology.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 10. there would not have been a viable Rift product. Oculus. Oculus and Luckey lacked the necessary expertise and technical know-how to create a viable virtual reality headset. Beginning after the E3 Convention in June 2012. and Oculus's new Chief Executive Officer Brendan Iribe sought that expertise and know-how from ZeniMax. Carmack has admitted that without ZeniMax. Without it. Luckey. this proprietary information was then provided by Iribe. Oculus. and continuing through the winter of 2013. had joined Luckey at Oculus seeking to commercialize and profit from ZeniMax’s technology. and Iribe directed Oculus's employees to use that technology to create the Oculus SDK and to develop. No resolution of that issue was reached. In the wake of the critical acclaim generated at the E3 Convention. and tune the Oculus Rift hardware. Oculus "wouldn't exist as a funded company.6 . During the rest of 2012. When ZeniMax provided its technology and guidance to Oculus. At the same time. and Iribe became increasingly evasive and uncooperative in discussions with ZeniMax regarding appropriate compensation for its technology and support. Luckey. Luckey informed Iribe and others about the Non-Disclosure Agreement he had signed which (among other things) confirmed that ZeniMax alone owned the critical VR technology being used by Oculus. including Iribe. and others within Oculus to Oculus engineers who had been unable to solve significant technical challenges. including by obtaining financing for Oculus.
Before leaving ZeniMax. and USA Today. ZeniMax commenced this action against Oculus and Luckey to obtain full and fair compensation for their unlawful use of its intellectual property. On July 21. 2013. On May 21. (“Facebook”) announced that it would acquire Oculus with its modified Rift and related virtual reality technology for approximately $2 billion in cash and stock. On August 1. 15. thereby confirming the enormous value of the intellectual property that ZeniMax had created. 2014. Wall Street Journal. Facebook Inc. and Carmack had taken. Luckey. Iribe.7 . including in The New York Times. Carmack's employment contract with ZeniMax expired. After he had joined Oculus. Facebook closed on its acquisition of Oculus. 6 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . On March 25. ZeniMax’s filing of this action was widely covered in the national media. Carmack returned to ZeniMax's premises and took without permission a customized tool that Carmack and other ZeniMax personnel had developed for work on virtual reality. and that Oculus. Facebook has confirmed its intention to make use of Oculus’s virtual reality technology – which is built upon ZeniMax’s unlawfully misappropriated intellectual property – for the financial benefit of Facebook’s core business of online social networking and advertising. 14. with full awareness of ZeniMax’s claims against Oculus and Luckey in this action. 2014. In public statements.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 13. 16. less than two years after Luckey formed Oculus. Carmack became Oculus's Chief Technology Officer ("CTO"). 2014. Carmack secretly and illegally copied thousands of documents containing ZeniMax's intellectual property from his computer at ZeniMax to a USB storage device which he wrongfully took with him to Oculus. Page 6 of 60 PageID 21177 Page 6 of 60 PageID 19518 In the summer of 2013.
Menlo Park. California. Oculus VR. 21.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 7 of 60 PageID 21178 Page 7 of 60 PageID 19519 PARTIES 17. Maryland. Oculus’s principal business office is 1601 Willow Road. It is the corporate successor both of Oculus VR. is a Delaware corporation with its principal place of business in Rockville. Its principal business office is 1601 Willow Road. Defendant Palmer Luckey. 2711 Centerville Road. Oculus. is a Delaware limited liability company with its principal place of business in Richardson. 19. resides (or recently resided) at 6301 East Seaside Walk. Texas. and Oculus LLC as appropriate. Inc. a Delaware corporation. an individual who is the alleged founder of Oculus. As used herein. Suite 400. LLC and its corporate predecessors. 2711 Centerville Road. Long Beach.8 . Facebook may be served with process by service upon its registered agent. California. 7 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . “Oculus” shall refer to Oculus VR.. Oculus also has an office in or near Dallas. a California limited liability company. Defendant Oculus VR. Plaintiff ZeniMax Media Inc. Inc. Delaware. California. Inc. 18. 20. Wilmington.. a wholly-owned subsidiary of ZeniMax Media Inc. Menlo Park. Inc. Facebook. Plaintiff id Software LLC. LLC is a Delaware limited liability company that is wholly owned by Facebook. Suite 400. Corporation Service Company. Inc. is a Delaware corporation. Texas. Oculus may be served with process by service upon its registered agent. Wilmington. Corporation Service Company. Delaware. and of that corporation’s predecessor Oculus LLC. which is the corporate headquarters of Facebook. and may be served with process by service at his place of employment.
California. (federal trademark law). resides (or recently resided) in or around Dallas. resides (or recently resided) in Palo Alto. JURISDICTION AND VENUE 24.C. Oculus. and may be served with process by service at his place of employment. (federal copyright law) and 15 U.S. Page 8 of 60 PageID 21179 Page 8 of 60 PageID 19520 Defendant Brendan Iribe.S.S. § 1391(a). an individual who is the Chief Executive Officer (CEO) at Oculus.C.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 22. The Court has jurisdiction in this Action pursuant to 15 U. § 1338(a) because this is a civil action arising under 17 U. an individual who is the Chief Technology Officer (CTO) at Oculus. (3) Carmack resides within Dallas County.9 . § 101 et seq. § 1121 and 28 U. The Court has supplemental jurisdiction over claims arising under the laws of Texas pursuant to 28 U. (2) Luckey contractually agreed to personal jurisdiction in Dallas County.C.S. Oculus.S. Venue is proper in this District because (1) a substantial part of the events giving rise to the claims occurred in the Northern District of Texas. § 1051 et seq.C. Texas. 23. See 28 U.S. and may be served with process by service at his place of employment.C. 8 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint .C. 25. Defendant John Carmack. § 1367 because ZeniMax’s claims are so related to the claims within the Court’s original jurisdiction that they form part of the same case or controversy under Article 3 of the United States Constitution. and (4) Defendants are otherwise subject to personal jurisdiction in the Northern District of Texas.
ZeniMax entered into employment agreements with several of id Software’s key employees. ZeniMax. engineers. three-dimensional (3D) computer graphics technology. bringing together world-class artists. title. ZeniMax acquired clear and unencumbered right. including Carmack.” and “RAGE. id Software’s franchises include the popular video games “DOOM. producers. and Carmack 26. At the time of its acquisition of id Software. and interest in and to all of id Software’s intellectual property and franchise assets. Carmack was one of id Software’s founders and served as its Technical Director. and video game engines. ZeniMax acquired id Software. ZeniMax was established in 1999 as the parent company for the acquisition of Bethesda Softworks. 28. a recognized leader in the development of video game franchises.. In his employment agreement with ZeniMax. designers. Carmack also agreed that ZeniMax would also be the author and owner of any copyrightable works that he prepared within the scope of his employment: 9 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . a developer and publisher of numerous successful video games. id Software. On June 23.” Through its acquisition of id Software.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 9 of 60 PageID 21180 Page 9 of 60 PageID 19521 FACTS A. industry best-in-class) video games for its publishing business. ZeniMax established and acquired additional video game studios and game franchises. Carmack agreed to disclose to ZeniMax inventions relating to the company’s current or anticipated research and development that Carmack created during the term of his employment.10 . 27.” “Quake.e. 29. and further agreed that all such inventions would be the sole and exclusive property of ZeniMax. 2009. and coders to create “AAA” (i.” “Wolfenstein. In the years following its inception.
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ZeniMax planned to demonstrate its soon-to-bereleased game. 14 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . wide field of view is another. but I was building these things myself. 2012) (emphasis added). and months of hard work modifying the prototype Rift to incorporate ZeniMax’s VR Technology. effective May 24. . and the software and stuff onto here. As a result of their years of research. and the strap. “DOOM 3: BFG Edition. Creator of Doom John Carmack Shows His Reality at E3 2012. In order to protect its proprietary VR Technology. ZeniMax’s modified Rift featured the “Holy Grail” combination of specially- tailored hardware and innovative software. He’s offering.” (Interview. ZeniMax and Luckey anticipated that demonstrations of the modified Rift would draw significant public and industry attention.youtube. Both are necessary to create an optimal user experience. and then I came across this guy Palmer Luckey . 38.) Carmack would later publish a white paper in 2013 describing in general terms one of these axes of improvement – “latency mitigation” – which has been frequently cited as one of the primary competitive advantages of the modified Rift. absolute positioning is another one. ZeniMax executed a non-disclosure agreement with Luckey. Carmack and others at ZeniMax transformed the Rift from $500-worth of optics into a powerful. available at http://www. He just sent it to me – the optics – I added my sensors. immersive virtual reality experience. He’s been building this in his workshop. 2012 (the “NonDisclosure Agreement”). . .” on the modified Rift at the E3 Convention in June 2012.15 . . going to be offering this as a kit for only $500 for the optics.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 14 of 60 PageID 21185 Page 14 of 60 PageID 19526 one of them .com/watch?v=GVDXXfbz3QE (published June 9. 39.
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ZeniMax provided that know-how. as well as being a profitable and sustainable hardware product. 2012. Luckey asked ZeniMax how to “flash” (i. On July 25. 2012. 21 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . 59. 2012. and further suggested an improved location on the modified Rift for mounting the sensor that “would be best from an alignment and rigidity standpoint. ZeniMax suggested solutions to correct the Rift’s optics calibration..” Luckey then sought ZeniMax’s technical guidance regarding the selection of low latency cables. 2012. install) customized firmware onto the sensors that ZeniMax selected for the modified Rift. and in doing so discovered that the Rift’s optical calibration was offcenter.” but Luckey ignored ZeniMax’s request for compensation for ZeniMax’s VR Technology. 63. ZeniMax proposed a call with Luckey to discuss how headset development should proceed moving forward. ZeniMax provided Luckey with a link to an FTP site to download the binary code. Luckey acknowledged that ZeniMax is “probably in the best position for early game support.22 . On July 17. would help to have Doom so I can record a bit of gameplay. Luckey asked ZeniMax for a copy of ZeniMax’s yet-to-be- released software: “Would it be possible to get my hands on the Doom 3 BFG demo? I am doing a new Kickstarter video.e. Luckey later admitted that the calibration was “a lot more off than I would have thought. ZeniMax improved the optics calibration for its “DOOM 3: BFG Edition” video game.” 58. Luckey ignored the request.” 62.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 21 of 60 PageID 21192 Page 21 of 60 PageID 19533 is manufactured in enough quantities that it would make a meaningful impact on game sales. 2012. Pursuant to the Non-Disclosure Agreement.” 60. Luckey asked ZeniMax for the customized binary code for the tracking sensors that Carmack had added to the modified Rift. On July 21. 61. On July 8. On July 13.
Luckey launched the Oculus Kickstarter campaign. At about that same time. ZeniMax Instructs Oculus and Luckey Not to Use Its Intellectual Property As Oculus and Luckey Actively Begin Commercializing The Rift (July-August 2012) 64. without authorization. 65. instructing that Luckey rely on publicly-available information for Kickstarter promotional material. The funding target was set at $250. 68.000. and having that credibility in the video would make a big difference for alot [sic] of people. Luckey again asked for ZeniMax’s help with the Kickstarter video.23 . Carmack advised Luckey: “It is very important that you NOT use anything that could be construed as Zenimax property in the promotion of your product.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 22 of 60 PageID 21193 Page 22 of 60 PageID 19534 Luckey downloaded the customized binary code and used it for future demonstrations of the modified Rift. On August 1. F. “I will make sure we do not show the Rage demo in the Kickstarter. 2012. ZeniMax’s 22 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . The Kickstarter page featured a five-minute video describing the modified Rift headset. In blatant disregard of ZeniMax’s rights.” displayed on the modified Rift headset. The video features multiple clips showing “DOOM 3: BFG Edition. specifically asking Carmack to provide a clip “talking about the Rift/VR in general/whatever else you think would be a great thing to have. Showing my R&D testbed with the Rage media would be bad. but is there any chance we can mention support/show a quick clip from Doom 3/BFG Edition?” ZeniMax turned down Luckey’s request. On July 26. 2012. Luckey replied.” 66. Oculus and Luckey used ZeniMax’s intellectual property in the Kickstarter video. The video also used “DOOM 3: BFG Edition” to promote the modified Rift by displaying. for instance.” Luckey further acknowledged: “Your reputation has really helped the credibility of this project. 67.” Carmack declined Luckey’s request to appear in the Kickstarter video.
far surpassing its original goal. 70. Ultimately. Defendant Brendan Iribe met Luckey in a Long Beach. On August 1. investors.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 23 of 60 PageID 21194 Page 23 of 60 PageID 19535 logo for “DOOM 3: BFG Edition” as the first Oculus-Rift ready game. Oculus and Luckey promised that certain backers of the Kickstarter campaign would receive copies of ZeniMax’s game “DOOM 3: BFG Edition” with support for the modified Rift.” “RAGE” is a video game developed and owned by ZeniMax. 72.” According to the video. 71.000 contributors. 69.’ a sci-fi shooting game. “[o]ne of the biggest problems with virtual reality up to this point is latency. Iribe and at least one of his associates became founding members. Shortly thereafter. the Kickstarter project reached $350. Oculus and Luckey also used ZeniMax’s VR Technology to demonstrate the modified Rift to potential investors in Oculus. The use of ZeniMax’s VR Technology by Oculus and Luckey directly resulted in the success of the Kickstarter project. 2012. The Kickstarter video also identifies “ultra-low latency head tracking” as “the magic that sets the Rift apart. During the summer of 2012.24 . 2012 he became the Chief Executive Officer of Oculus.000 in funding. Iribe has admitted that at 23 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . where Iribe was “transported to a three-dimensional view of a room from ‘Rage. On or about July 4. California hotel room. Only four hours after the project launch. the Kickstarter project raised $2. The benefit of the Rift is that it is designed to be really really low latency.” The low latency head tracking highlighted in the Kickstarter video refers to ZeniMax’s VR Technology.44 million in funding from nearly 10. Further. and/or officers of Oculus. despite the lack of any commercial agreement with ZeniMax.
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we’re left wondering if there’s any hope.” 92. as well as a license to ZeniMax’s VR Technology that had been disclosed pursuant to the Non-Disclosure Agreement. Oculus responded to this counterproposal. and in disregard of ZeniMax’s directives not to use ZeniMax property to promote the Rift. 91. On October 19. Luckey. Oculus’s Chief Engineer. 2012.30 . The prospectus also featured “DOOM” logos on multiple slides without ZeniMax's permission. Jack McCauley. agreeing to provide on-going support. their senior personnel – acting under Iribe's direction – continued to reach out to and rely on ZeniMax to obtain additional ZeniMax VR Technology that Oculus needed for developing the Rift. 89. Notwithstanding the failure by Oculus. 2012. and Iribe to engage in discussions with ZeniMax regarding these business issues (which one Oculus employee euphemistically termed “politics”). In return. 2012. acknowledging that “Oculus is short handed in the system expertise”: 29 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . and neither had officially endorsed the Rift. asserting that ZeniMax’s proposal “is so far out of the ballpark. ZeniMax had no such agreement with Oculus. ZeniMax made a counter-proposal to Oculus. The Oculus prospectus also included a “product roadmap” that represented that ZeniMax’s franchises “DOOM 3: BFG Edition” and “Skyrim” would be made to work with the Rift. Other ZeniMax game logos were incorporated into the Oculus prospectus without ZeniMax’s permission. ZeniMax asserted its rights to a larger share of equity in Oculus to reflect ZeniMax’s past and continuing contributions.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 29 of 60 PageID 21200 Page 29 of 60 PageID 19541 names and logos in the prospectus. asked ZeniMax for assistance with an image display question. On November 13. 90. including much of the support requested by Oculus. on November 22. For example.
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Luckey and Iribe had numerous in-person. and continuing through Facebook's acquisition of Oculus. and again invited ZeniMax to invest more money and resources in Oculus. Oculus and Luckey continue to promote themselves as the developer and owner of ZeniMax’s breakthrough VR Technology. Luckey and Iribe even concealed the existence of that Non-Disclosure Agreement from fellow officers and founding members of Oculus. including several rounds of financing. 2013. Oculus continued to use ZeniMax VR Technology without license or permission to do so. including Oculus's Chief Operating Officer Laird Malamed. Nevertheless. contracts.34 . and he relied on ZeniMax's computer program code and games to demonstrate the prototype Rift. Oculus’s offer still did not provide any compensation for the contributions that ZeniMax had already made. electronic. Throughout this period. which had actually been developed by ZeniMax without any substantial contribution from Luckey. 100. his computer programming skills were rudimentary. Luckey increasingly and falsely held himself out to the media and the public as the visionary developer of the Rift’s VR Technology. and other legal documents to potential investors conducting due diligence on Oculus. who was the Oculus officer for providing Oculus's non-disclosure agreements. On January 22. Malamed did not learn about the existence of the Non-Disclosure Agreement until ZeniMax commenced this litigation. Luckey and Iribe concealed from those potential investors and business partners the existence of the NonDisclosure Agreement that Luckey had executed. 33 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . and telephonic communications with potential investors and business partners. this fraudulent tale was frequently reported in the media as fact. 101. Oculus began further efforts to obtain financing.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 33 of 60 PageID 21204 Page 33 of 60 PageID 19545 create commercially viable VR technology.
including Carmack. 34 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . Oculus and Luckey then sought to obtain additional virtual reality know-how by recruiting ZeniMax employees. to join Oculus. 104. ZeniMax directed Carmack to cease providing proprietary information or other technological assistance to Oculus until a satisfactory business arrangement could be reached between Oculus and ZeniMax.35 . In light of the refusal by Oculus and Luckey to enter into serious negotiations with ZeniMax. And Iribe Recruit Carmack And Other ZeniMax Employees To Obtain Further Access To ZeniMax’s VR Technology 102. 103.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 I. Carmack’s employment contract with ZeniMax expired on June 21. Rather than compensate ZeniMax for the use of its intellectual property. Page 34 of 60 PageID 21205 Page 34 of 60 PageID 19546 Oculus. Carmack worked in the summer of 2013 as a part-time technical advisor for id Software after his employment contract ended pursuant to a three-month agreement. 2013. Carmack subsequently advised ZeniMax that he would not renew his employment at id Software. Luckey. 105.
After Carmack began working for Oculus in August 2013. and he has used this tool for developing virtual reality technology for Oculus.36 . and industry legend.” 107. Carmack has refused to return the tool to ZeniMax. 35 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . 106. Oculus noted. Carmack had worked with other ZeniMax personnel to develop and manufacture this tool in November 2012. There are very few people in the world that can contribute to the Oculus Rift and the future of virtual reality like John can. Thousands of pages of ZeniMax's confidential documents were taken by Carmack and uploaded to Oculus's computers in this manner. he returned to the premises of ZeniMax to obtain a custom tool used for developing head mounted displays. in direct violation of his continuing legal obligations under employment contract with ZeniMax.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 35 of 60 PageID 21206 Page 35 of 60 PageID 19547 Carmack has retained these files and he has used them for his work at Oculus. In August 2013. “John is one of the brightest minds of our generation – pioneer. In Oculus’s press release. visionary. Oculus announced that Carmack had joined Oculus as its Chief Technical Officer.
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simultaneously resigned. Page 37 of 60 PageID 21208 Page 37 of 60 PageID 19549 All of those employees had access to ZeniMax confidential information and trade secrets. The February 20. as was Carmack. and all were subject to strict postemployment confidentiality and non-solicitation obligations. and are the sole and exclusive property of [ZeniMax]. 110. made. 2014. All five of those former ZeniMax employees immediately joined Oculus. At least one of the resigning employees refused to certify to ZeniMax upon his resignation that all ZeniMax confidential information in his possession had been returned to ZeniMax. 111.” 37 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . A similar letter was sent to Oculus.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Carmack at id Software. more than a month before there was any announcement of the acquisition transaction discussed below. ZeniMax sent a letter to Carmack reminding him of the provision of his Employment Agreement that obliged him to refrain from recruiting ZeniMax employees for two years following his employment from ZeniMax. On February 20. conceived or first reduced to practice during and within the scope of [his] employment with [ZeniMax] are to be disclosed to [ZeniMax].38 . 2014 letter to Carmack also reminded Carmack that he agreed in his Employment Agreement that “all Inventions [he] created.
Page 38 of 60 PageID 21209 Page 38 of 60 PageID 19550 Facebook Announces A $2 Billion Acquisition Of Oculus. 2014. 38 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . On March 25. Following Facebook’s announcement.39 . Legal counsel to Oculus rejected ZeniMax’s claims without addressing the factual basis for them. thereby confirming the market value of the intellectual property that ZeniMax had provided to Oculus and Luckey pursuant to the Non-Disclosure Agreement. Oculus and Luckey Continue Exploiting ZeniMax’s Intellectual Property (March-April 2014) 112. ZeniMax’s counsel contacted Oculus yet again by letter to point out ZeniMax’s continuing rights and ownership of the VR Technology embodied in the Rift. Facebook announced a proposed acquisition of Oculus for $2 billion in cash and stock. 113.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 J.
In response to subsequent press coverage of ZeniMax’s dispute with Oculus.40 . notwithstanding Oculus's heavy dependence on ZeniMax technology. respectively. 39 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . people come out of the woodwork with ridiculous and absurd claims” – referring. 115. an Oculus spokesperson acted as though ZeniMax were an unknown interloper. Oculus then issued a press release stating that “ZeniMax has never contributed any IP or technology to Oculus[. to Facebook’s planned acquisition of Oculus and to ZeniMax.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 39 of 60 PageID 21210 Page 39 of 60 PageID 19551 114. but when there’s this type of transaction. stating.]” In that press release. 116. “It’s unfortunate.
41 .Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Page 40 of 60 PageID 21211 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint .
L. and Facebook knew or had reason to know that they were false. advisors. Oculus purported to represent to Facebook that it “has full title and ownership of. in that Merger Agreement.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 41 of 60 PageID 21212 Page 41 of 60 PageID 19553 120. 124. And Announces Its Intention To Exploit ZeniMax’s Technology For The Financial Benefit Of Its Core Business (May-July 2014) 121.” (Amended And Restated Agreement And Plan Of Merger (“Merger Agreement”) § 2. … and independent contractors who independently or jointly contributed to or participated in the conception. Oculus. all Intellectual Property necessary to enable it to carry on [its] Business.9(g). Iribe.) 122. Facebook required Oculus’s shareholders to indemnify Facebook for “any failure of any representation or warranty” given by Oculus in 41 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . Luckey. title and interest in and to such Intellectual Property. creation or development of any Intellectual Property for [Oculus] … unencumbered and unrestricted exclusive ownership of.42 .” (Merger Agreement § 2. free and clear of any Encumbrances and without any conflict with or infringement upon the rights of others. Accordingly. all of [those] Authors’ right. Oculus further purported to represent to Facebook that Oculus “has secured from all … consultants. or is duly licensed under or otherwise authorized to use. In the agreement pursuant to which Facebook acquired Oculus. At the time those representations were made – and at the time the acquisition transaction subsequently closed – those representations were false. reduction to practice. Facebook Completes Its Acquisition Of Oculus With Full Awareness Of ZeniMax’s Claims And The Non-Disclosure Agreement.) 123. In that Merger Agreement.9(b). and Carmack knew them to be false.
at least one officer of the newly- formed Oculus VR.. Following Facebook’s acquisition of Oculus. At or about that time. 126. and with full awareness of the Non-Disclosure Agreement executed by Luckey. and USA Today. Facebook was provided by Oculus with a copy of the Non-Disclosure Agreement executed by Luckey.43 . cash and stock having a value of approximately $200. with full awareness of ZeniMax’s claims against Oculus and Luckey in this action. ZeniMax commenced this action against Oculus and Luckey to obtain full and fair compensation for their unlawful use of its intellectual property.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 42 of 60 PageID 21213 Page 42 of 60 PageID 19554 the Merger Agreement. Luckey. LLC is a high-level employee of Facebook. On May 21. Facebook closed on its acquisition of Oculus.e. and became the sole owner of Oculus. As a result of the acquisition of Oculus. 127. 125. 42 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . California. Iribe. VIII. and Oculus’s principal business office is Facebook’s corporate headquarters in Menlo Park. Carmack and others have been unjustly enriched by their misappropriation of ZeniMax's technology and other wrongdoing. On July 21. including indemnification against claims by third parties such as ZeniMax. 128. 2014. Wall Street Journal.000. and in the industry press. including in The New York Times.) An escrow agreement entered into in connection with the Merger Agreement also provided that Facebook would withhold ten percent of the consideration for the acquisition transaction – i.000 – to provide Facebook with security for those indemnification obligations. (Merger Agreement art. ZeniMax’s filing of this action was widely covered in the national media. 2014.
We view this as a software and services thing.) 130. Page 43 of 60 PageID 21214 Page 43 of 60 PageID 19555 Facebook has publicly confirmed that it did not acquire Oculus solely for the purpose of entering the business of selling virtual reality headsets.44 . (Emphasis added. Defendants further planned to keep the enormous value of ZeniMax’s VR Technology for themselves alone. in a March 25. where if we can make it so that this becomes a network where people can be communicating and buying things and virtual goods and there might be advertising in the world. 43 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . an analyst asked: [W]hat do you envision the Oculus business model to look like eventually? Is it mostly hardware sales? Is it advertising/licensing? Or all of the above? Facebook’s founder and Chief Executive Officer Mr. Defendants intended to leverage and commercially exploit Oculus’s virtual reality technology – which is built upon ZeniMax’s unlawfully misappropriated intellectual property – for the financial benefit of Facebook’s core business of online social networking and advertising. Zuckerberg responded to that question by stating: In terms of our own business model. Rather than make a profit off the sale of virtual reality headsets. we’re clearly not a hardware company. Oculus began shipping the Rift to consumers. On March 28. For example. 2016. Then I think that’s probably where the business will come from. but we need to figure that out down the line. if I had to say. 2014 investor call following Facebook’s announcement of its intended acquisition of Oculus. 131.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 129. and to provide no compensation whatsoever to ZeniMax. We’re not going to try to make a profit off of the devices long term.
136. designs. displays. and jitter/judder reduction. methods. concepts. cables. 135. low-latency head-tracking. All of the ZeniMax Trade Secrets were confidential. and know-how related to virtual reality headsets. modifications. proprietary. improvements.45 . including positional and absolute tracking. sensors and optical components calibration. ZeniMax incorporates by reference all preceding and succeeding paragraphs of this Complaint. minimizing simulator sickness and/or motion sickness for users. combining and selecting devices. research data and results. 133. predictive tracking. enforceable trade secrets in the confidential. latency reduction. head and neck modeling.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 44 of 60 PageID 21215 Page 44 of 60 PageID 19556 COUNTS COUNT 1— Common Law Misappropriation of Trade Secrets (Against All Defendants) 132. interfaces between virtual reality headsets and interactive entertainment content and/or software. pre-warping of displayed images. 134. optics. and related hardware solutions best-suited for improving the user’s virtual reality experience. including but not limited to: confidential programming code. ZeniMax took reasonable precautions to maintain the secrecy of the ZeniMax Trade Secrets. chromatic aberration reduction. ZeniMax Trade Secrets include valid. including confidentiality provisions in key employment agreements. distortion. motion blur. and creating a commerciallyviable virtual reality headset. minimizing or removing the “screen door” effect on the display. secured 44 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . The ZeniMax Trade Secrets are not generally known or readily ascertainable. and highly valuable secrets prior to disclosure to Defendants. proprietary components of ZeniMax’s “DOOM 3: BFG Edition” computer program code. ZeniMax is the owner of valid and enforceable trade secrets in the ZeniMax VR Technology (“ZeniMax Trade Secrets”). plans.
140. 138. Facebook improperly acquired access to ZeniMax Trade Secrets through its acquisition of Oculus. commercially exploit. and confidentiality agreements with third-parties to whom the information is disclosed. Facebook had notice that the ZeniMax Trade Secrets were confidential. Oculus and Luckey breached that confidence beginning in 2012 by using and/or disclosing ZeniMax Trade Secrets in developing. Defendants intended to leverage and commercially exploit ZeniMax Trade Secrets for the financial benefit of Facebook’s core business of online social networking and advertising. and by their actions and conduct Defendants established that Oculus was bound by the Non-Disclosure Agreement as if it were a signatory thereto. Oculus and Luckey knew that by hiring former ZeniMax employees. 141. Defendants knew or had reason to know of the obligations of Oculus and Luckey to keep confidential and refrain from unauthorized use of ZeniMax Trade Secrets. testing. ZeniMax disclosed and provided ZeniMax Trade Secrets to Oculus and Luckey in confidence. pursuant to the Non-Disclosure Agreement.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 45 of 60 PageID 21216 Page 45 of 60 PageID 19557 password-protected networks and databases. Oculus and Luckey further breached that confidence by providing to Facebook access to ZeniMax Trade Secrets. ZeniMax also took reasonable precautions by instructing Defendants not to make unauthorized use of ZeniMax’s proprietary information. programming. and marketing the Rift headset. 137. proprietary. and highly 45 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . including the Non-Disclosure Agreement. 139. such employees would inevitably disclose ZeniMax Trade Secrets. demonstrating. and intended to leverage. In furtherance of that plan and without authorization from ZeniMax. and otherwise use the ZeniMax Trade Secrets.46 . designing.
142. and acting pursuant to a common purpose to which Defendants were a part. ZeniMax’s rights. is attached as Exhibit 1. 143. 148. respectively.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 46 of 60 PageID 21217 Page 46 of 60 PageID 19558 valuable. A true and correct copy of the certificate of copyright registration. Defendants are jointly and severally liable for their conduct by acting in concert to produce an indivisible injury. Copyright Registration No. or in the alternative at least grossly negligent. 146. PA0001851913. Defendants’ misappropriation of ZeniMax’s trade secrets has caused and will continue to cause damage to ZeniMax in an amount to be determined at trial. deliberate. ZeniMax owns and has a valid copyright in the “DOOM 3: BFG Edition” computer program. and that obtaining access to ZeniMax Trade Secrets from Oculus and Luckey would be a breach of the Non-Disclosure Agreement between ZeniMax and Oculus and Luckey. The foregoing acts constitute common law misappropriation of ZeniMax’s trade 144. 149. and willful. TXu 1-897-004 and TXu 1-897-005 are attached as Exhibits 2 and 3. ZeniMax owns and has valid copyrights in “ZeniMax VR Testbed Code” and “ZeniMax VR Implementation Code. 145. Defendants’ conduct challenged herein was undertaken with full knowledge of secrets.47 . COUNT 2—Copyright Infringement (Against All Defendants) 147.” A true and correct copy of the certificates of copyright registration. Defendants’ conduct was malicious. 46 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . Copyright Registration Nos. ZeniMax incorporates by reference all preceding and succeeding paragraphs of this Complaint.
156.48 . license or distribute the ZeniMax Copyrighted Materials. and Carmack had access to ZeniMax Copyrighted Materials through current and former ZeniMax employees. “ZeniMax VR Testbed Code. Carmack additionally had access to ZeniMax Copyrighted Materials through his former employment at ZeniMax. and distributed products (including versions of Oculus Software Development Kits (“Oculus SDKs”)) derived from ZeniMax’s Copyrighted Materials in whole or in part. Products of Oculus. As the CEO of Oculus. As the CTO of Oculus. Oculus.” and “ZeniMax VR Implementation Code” (collectively. and Carmack. and Carmack have copied. Page 47 of 60 PageID 21218 Page 47 of 60 PageID 19559 ZeniMax’s “DOOM 3: BFG Edition” computer program. 153.C. are substantially similar to the protected elements of ZeniMax’s Copyrighted Materials. Iribe has a direct financial interest in the infringing activity of Oculus and Luckey and has the right and ability to supervise their infringing acts. “ZeniMax Copyrighted Materials”) contain computer code that embodies ZeniMax’s VR Technology and constitute copyrightable subject matter within the meaning of 17 U. and will continue to do so. 151. 155. Carmack has a direct financial interest in the infringing activity of Oculus and Luckey and has the right and ability to supervise their infringing acts. such as versions of Oculus SDKs.S.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 150. Luckey. 152. Facebook had knowledge that the Oculus products were derived from ZeniMax’s Copyrighted Materials. Without authorization. Facebook has a direct financial interest in the infringing activity of Oculus and Luckey and has the right and ability to supervise their 47 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . As the sole owner of Oculus. publicly displayed. Iribe. 154. Oculus. Luckey. sell. Iribe. § 102. Luckey. Iribe. Defendants have no license or any other form of permission to commercially copy.
ZeniMax entered into a valid. ZeniMax provided Luckey with proprietary information under the Non-Disclosure Agreement.49 . 17 U.C. ZeniMax Copyrighted Materials. Defendants’ acts of direct.S. including ZeniMax Trade Secrets. 165. causing. “Contract-Protected Information”).Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 48 of 60 PageID 21219 Page 48 of 60 PageID 19560 infringing acts. pursuant to the Copyright Act. 158. 162. contributory. 157. 2012. contributory. enforceable and binding written contract with Palmer Luckey. Facebook substantially participated in the infringing activity of Oculus and Luckey by inducing. COUNT 3—Breach of Contract (Against Oculus and Luckey) 159. Contract-Protected Information disclosed to Luckey was not public knowledge and did not become public knowledge at any time. ZeniMax incorporates by reference all preceding and succeeding paragraphs of this Complaint. and/or vicarious copyright infringement have caused and will continue to cause damage to ZeniMax in an amount to be determined at trial. 161. and in utter disregard of ZeniMax’s copyrights. Luckey was not entitled to Contract-Protected Information free of any obligation of confidentiality prior to ZeniMax’s disclosure of the information to Luckey. 160. Defendants’ acts of direct. deliberate. 164. Luckey agreed not to use or disclose ZeniMax’s Contract-Protected Information without ZeniMax’s approval. and/or vicarious copyright infringement are willful. Luckey further agreed 48 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . ZeniMax fully performed its obligations under the Non-Disclosure Agreement. § 504. and other confidential information (collectively. or materially contributing to the infringing conduct. 163. effective May 24. Under the Non-Disclosure Agreement.
166. 171. 2012. including Oculus. and to disclose such information only to his directors. and providing to Facebook access to ZeniMax’s Contract-Protected Information. ZeniMax entered into a valid.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 49 of 60 PageID 21220 Page 49 of 60 PageID 19561 to restrict use of the Contract-Protected Information for a “Proper Purpose” approved by ZeniMax. or attorneys who clearly have a need-to-know. and promoting the Rift headset. ZeniMax incorporates by reference all preceding and succeeding paragraphs of this Complaint. 49 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . or employees in his personal capacity. employees. 167. The breach of contract by Oculus and Luckey has caused and will continue to cause damage to ZeniMax in an amount to be determined at trial. The breach of contract by Oculus and Luckey was a wrongful use of ZeniMax’s Contract-Protected Information and not within the “Proper Purpose” authorized by the Non-Disclosure Agreement. 169. 168. officers. demonstrating. COUNT 4—Tortious Interference with Contract (Against Facebook) 170. Luckey disclosed Contract-Protected Information to third-parties. Oculus and Luckey breached the Non-Disclosure Agreement by using ZeniMax’s Contract-Protected Information for testing. without expressly-authorized permission or authorization from ZeniMax. effective May 24. enforceable and binding written contract with Palmer Luckey. Luckey did not and does not have any directors. plus attorneys’ fees and costs for bringing this action as provided for in the Non-Disclosure Agreement. Oculus knew and had reason to know that Luckey received such information pursuant to the Non-Disclosure Agreement.50 . By their actions and conduct. Defendants established that Oculus was also bound by the Non-Disclosure Agreement as if it were a signatory thereto. officers. developing.
By their actions and conduct. ZeniMax owns valuable copyrightable works. 175. Luckey did not and does not have any directors. COUNT 5—Unfair Competition (Against Oculus and Facebook) 178.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 50 of 60 PageID 21221 Page 50 of 60 PageID 19562 172. 179. Facebook interfered with the Non-Disclosure Agreement by willfully and intentionally causing Oculus and Luckey to use ZeniMax’s Contract-Protected Information for a purpose not approved by ZeniMax and in breach of the obligations that Oculus and Luckey had under the Non-Disclosure Agreement. or employees in his personal capacity. and confidential information. Defendants established that Oculus was also bound by the Non-Disclosure Agreement as if it were a signatory thereto. 177. trade secrets. 176. This interference proximately caused irreparable injury to ZeniMax and actual damage and loss. ZeniMax incorporates by reference all preceding and succeeding paragraphs of this Complaint. ZeniMax fully performed its obligations under the Non-Disclosure Agreement.51 . 173. Luckey further agreed to restrict use of the Contract-Protected Information for a “Proper Purpose” approved by ZeniMax. Under the Non-Disclosure Agreement. Facebook was aware of the existence and terms of the Non-Disclosure Agreement between ZeniMax and Oculus and Luckey. employees. trademarks. officers. or attorneys who clearly have a need-to-know. and to disclose such information only to his directors. Luckey agreed not to use or disclose ZeniMax’s Contract-Protected Information without ZeniMax’s approval. officers. which separately and in combination create a competitive advantage in 50 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . 174.
never compensated ZeniMax. promote. Defendants established that Oculus also was bound by the Non-Disclosure Agreement as if it were a signatory thereto. Oculus violated the principles of the common law of unfair competition by trading on the goodwill of ZeniMax. competing unfairly. technology or information. and commercialize the Rift headset. 182. and money. and effort invested in developing revolutionary virtual reality technology. 181. Oculus and Facebook interfered with ZeniMax’s ability to return value to its shareholders for the time. labor. never obtained a license to use any of ZeniMax’s property.52 . skill. As a direct result of Oculus’s illegal conduct. 180. and trade secret misappropriation. money. By their actions and conduct. Facebook violated the principles of the common law of unfair 51 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . and by creating a false association between Oculus and ZeniMax. including copyright infringement.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 51 of 60 PageID 21222 Page 51 of 60 PageID 19563 the interactive entertainment industry and were created through extensive time. Oculus and Facebook committed one or more illegal acts. trademark infringement. Oculus and Facebook have deprived ZeniMax of the control and dissemination of its proprietary inventions and confidential knowhow concerning virtual reality headset devices and related virtual reality technology. by using ZeniMax’s intellectual property without authorization to develop. 185. 184. 186. Oculus breached the terms of a Non-Disclosure Agreement. took ZeniMax’s intellectual property. Facebook acquired Oculus with full knowledge of ZeniMax’s claims against Oculus and Luckey for their misconduct. and now unfairly stands to realize billions of dollars in value trading off of ZeniMax’s hard work. 183. commercially exploited it for its own gain.
ZeniMax incorporates by reference all preceding and succeeding paragraphs of this Complaint. ZeniMax has entitlement to possession of all of its proprietary information. Oculus and Luckey knew that by hiring former ZeniMax employees. 192. upon the termination of his employment. 190. 193.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 52 of 60 PageID 21223 Page 52 of 60 PageID 19564 competition by attempting to profit from ZeniMax’s intellectual property and the wrongful acts of Oculus. 187. Defendants are jointly and severally liable for their conduct by acting in concert to produce an indivisible injury. and acting pursuant to a common purpose to which Defendants were a part. including its VR Technology. he copied thousands of documents from a computer at ZeniMax to a USB storage device.53 . 189. Oculus intentionally solicited and hired ZeniMax employees to deprive ZeniMax of institutional knowledge and intellectual capital. including its VR Technology. He never returned those files or all copies of them after his employment with ZeniMax 52 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . such employees would inevitably disclose confidential and proprietary ZeniMax information and technology. during his last days at ZeniMax. Carmack breached his employment agreement with ZeniMax which required him to return all copies of ZeniMax's Confidential Information. COUNT 6—Conversion (Against Carmack) 191. Instead of complying with his contract. 188. as well as to surreptitiously gain further unauthorized access to ZeniMax’s property. The wrongful conduct of Oculus and Facebook has caused and will continue to cause significant commercial harm to ZeniMax in an amount to be determined at trial.
its proprietary information. 197. amounting to tens of millions of dollars. 53 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . and has instead used it for the benefit of Oculus and has taken elaborate steps to conceal his illegal activity. and then selling Oculus with ZeniMax’s VR Technology to Facebook. Defendants commercially exploited it for their own gain. In addition. ZeniMax owns. Luckey. By their actions and conduct. technology or information. software. COUNT 7—Unjust Enrichment (Against All Defendants) 195. Defendants established that Oculus also was bound by the Non-Disclosure Agreement as if it were a signatory thereto.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 53 of 60 PageID 21224 Page 53 of 60 PageID 19565 was terminated. Carmack has refused ZeniMax's demand to return its VR Technology. and is entitled to possession of. he returned to ZeniMax's premises to take a customized tool for developing VR Technology belonging to ZeniMax that itself is part of ZeniMax's VR Technology. ZeniMax incorporates by reference all preceding and succeeding paragraphs of this Complaint. 194. including the VR Technology that Carmack took without ZeniMax's authorization. market. demonstrate. 196. and Iribe took ZeniMax’s intellectual property pursuant to a Non-Disclosure Agreement. Defendants took unlawful advantage of ZeniMax’s employees. Defendants have now been unjustly enriched by billions of dollars in value exploiting ZeniMax’s hard work and VR Technology as if it were their own. Defendants never obtained a license to use any of ZeniMax’s property. 198. after Carmack's employment with ZeniMax was terminated. design.54 . improve. and disclosures in confidence to Oculus and Luckey by knowingly using ZeniMax’s confidential information and know-how to develop. and promote the Rift headset. Oculus.
and Iribe sought to enrich themselves by recruiting ZeniMax personnel with needed expertise rather than compensate ZeniMax for its VR Technology.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 199. and from their announced sale of Oculus with ZeniMax’s VR Technology.55 . such employees would inevitably disclose confidential and proprietary ZeniMax information and technology. 54 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . from their misappropriation of ZeniMax’s trade secrets. it would be unconscionable to permit Defendants to profit from a “free-ride” on ZeniMax’s years of work in researching and developing virtual reality technology. As such. Defendants were also unjustly enriched by gaining unauthorized access to ZeniMax’s intellectual property through the concerted effort of recruiting and hiring multiple former ZeniMax employees who are all subject to strict confidentiality and non-solicitation obligations. commercial benefit from ZeniMax’s contributions to the Rift headset. from their violation of ZeniMax copyrights and trademarks. Page 54 of 60 PageID 21225 Page 54 of 60 PageID 19566 Defendants have knowingly and wrongfully obtained and/or passively received a substantial. Oculus. Oculus. Oculus. design solutions. 200. including technical improvements. Luckey. Defendants refuse to compensate ZeniMax for the value of ZeniMax’s contributions to the modified Rift and related technology. Luckey. Luckey. and Iribe knew that by hiring former ZeniMax employees. and Iribe knew that the manner in which the employees were hired violated the employees’ contracts with ZeniMax. and related VR Technology. 202. and marketing promotion provided by ZeniMax to Oculus and Luckey. 201.
subsisting. and to give ZeniMax nothing.839 for 55 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . including their blatant misappropriation of ZeniMax’s intellectual property. No.050 for “RAGE” and design. 2.080. Luckey. No. COUNT 8—Trademark Infringement (Against Oculus.56 . No. title. Defendants are jointly and severally liable for their conduct by acting in concert to produce an indivisible injury.094. 4.303. was planned and intended to keep the enormous value of ZeniMax’s VR Technology for themselves alone.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 55 of 60 PageID 21226 Page 55 of 60 PageID 19567 Carmack has used this VR Technology for Oculus's benefit.244 for “RAGE”. 4.125 for “ID”. 2. No. 204. 206. Facebook has also been unjustly enriched by gaining unauthorized access to ZeniMax’s intellectual property and leveraging and commercially exploiting ZeniMax’s intellectual property for the financial benefit of Facebook’s core business of online social networking and advertising. No. and Iribe) 207. 4.050.299 for “RAGE” and design. 208. 3. Defendants’ unlawful course of conduct. 205.972 for “RAGE” and design. and uncancelled United States Trademark Registrations No.972.165. ZeniMax incorporates by reference all preceding and succeeding paragraphs of this Complaint. 3.605 for “DOOM 3”. ZeniMax or one of its affiliates is the owner of the entire right. No. and acting pursuant to a common purpose to which Defendants were a part.923.198. and interest in and to valid.928.100 for “DOOM II” and design. 2. No.083 for “DOOM”. No. Defendants’ wrongful conduct and unjust enrichment caused and will continue to cause damage to ZeniMax in an amount to be determined at trial. 203. 2.
S. 15 U. and will continue to suffer irreparable harm as a result of such violations of law for which there is no adequate remedy at law. and Iribe have been undertaken with full knowledge of ZeniMax’s rights in the ZeniMax Marks.57 .050. Luckey. and Iribe challenged herein is intended to and is likely to cause confusion and to cause the relevant public to mistakenly believe that Defendants’ products and services emanate from. Luckey. and Iribe are without license from or permission of ZeniMax. 213. and 2. 211. the “ZeniMax Marks”).C.605.928.C. and Iribe) 214. The conduct of Oculus. Reg. The conduct of Oculus.125 are incontestable pursuant to 15 U. Nos. ZeniMax has suffered damages as a result of the violations of law by Oculus. are authorized. 215.859 for “SKYRIM” (collectively. 210.S. ZeniMax incorporates by reference all preceding and succeeding paragraphs of this Complaint. are authorized. endorsed. No. 209. The acts of Oculus. and Iribe.083. § 1065. endorsed. or 56 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . 4.280. COUNT 9—False Designation (Against Oculus. or connected or affiliated in some way with ZeniMax in violation of Section 32(1) of the Lanham Act. sponsored or licensed by. Luckey. and No.097.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 56 of 60 PageID 21227 Page 56 of 60 PageID 19568 “SKYRIM”. and Iribe challenged herein was malicious. deliberate and willful. Luckey. Luckey.165. The acts of Oculus. 2. Luckey. 2. Luckey. and Iribe infringes ZeniMax’s exclusive rights in its federally registered ZeniMax Marks and is likely to cause confusion and to cause the relevant public to mistakenly believe that Defendants’ products and services emanate from. sponsored or licensed by. § 1114(1).150 for “SKYRIM”. 212. 4. The use of the ZeniMax Marks by Oculus.
false endorsement and false association in violation of Section 43(a) of the Lanham Act.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 57 of 60 PageID 21228 Page 57 of 60 PageID 19569 connected or affiliated in some way with ZeniMax and constitutes unfair competition. 216.C. The conduct of Oculus.S. and Iribe challenged herein was malicious. Luckey. The conduct of Oculus. Luckey. and Iribe. 57 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . 15 U. Luckey. 217. ZeniMax has suffered damages as a result of the violations of law by Oculus. § 1125(a).58 . 218. and will continue to suffer irreparable harm as a result of such violations of law for which there is no adequate remedy at law. deliberate and willful. and Iribe challenged herein has been undertaken with full knowledge of ZeniMax’s rights in the ZeniMax Marks and other registered and unregistered trademarks and service marks of ZeniMax and other well-known indicia of ZeniMax and its goods and services.
Luckey. Disgorgement. Facebook. and that ZeniMax be awarded a judgment against Defendants for the following: a. Equitable Relief. All other relief to which ZeniMax is entitled. h. 58 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . ZeniMax asks that the Court issue citation for Defendants Oculus. g. Restitution.S. and n. d. c. k. b. e. and Carmack to appear and answer. i. Iribe. Replevin. j. m. Punitive and Exemplary Damages. f. Attorney Fees.. § 101 et seq. Prejudgment and Post-Judgment Interest. Injunctive Relief. l. Statutory Damages under 17 U. Actual Damages. Unjust Enrichment. Enhanced Damages. Court Costs. PRAYER FOR RELIEF For the foregoing reasons.59 .Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 58 of 60 PageID 21229 Page 58 of 60 PageID 19570 DEMAND FOR JURY TRIAL ZeniMax hereby demands a trial by a jury on all issues so triable by right.C.
LISY Email: Christopher. AND ID SOFTWARE LLC 59 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint .com CHRISTOPHER A.: 212-735-3000 Facsimile No.com JAMES Y. Texas 75219 Telephone No.Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Dated: May 20. PAK Texas State Bar No. 24086376 E-mail: James. CASEY E-mail: William. s/ Phillip B.com (foregoing attorneys admitted pro hac vice) SKADDEN. MEAGHER & FLOM LLP Four Times Square New York.Pak@skadden. ARPS. Suite 700 Dallas.60 .Hemr@skadden.com WILLIAM J. ANTHONY SAMMI E-mail: Anthony. New York 10036 Telephone No.Casey@skadden. 2016 Dallas. SLATE.: 212-735-2000 ATTORNEYS FOR PLAINTIFFS ZENIMAX MEDIA INC. Philbin PHILLIP B. PHILBIN PHILLIP B.: 214-651-5940 P. PHILBIN Texas State Bar No.Lisy@skadden.com KURT WM.philbin@haynesboone. HEMR E-mail: Kurt.Sammi@skadden. 15909020 E-mail: phillip. Texas Page 59 of 60 PageID 21230 Page 59 of 60 PageID 19571 Respectfully submitted.com HAYNES AND BOONE LLP 2323 Victory Avenue.: 214-651-5000 Facsimile No.
2016 s/ Phillip B.S. Philbin 60 Appendix to Defendants' Opposition to Plaintiffs Motion to Unseal 2nd Amended Complaint . Northern District of Texas. I hereby certify that I have served all counsel and/or pro se parties of record electronically or by another manner authorized by Federal Rule of Civil Procedure 5(b)(2). Dated: May 20. using the electronic case files system of the court. District Court. 2016.61 .Case 3:14-cv-01849-K Document 610 Filed 08/16/16 Case 3:14-cv-01849-K Document 512 Filed 05/20/16 Page 60 of 60 PageID 21231 Page 60 of 60 PageID 19572 CERTIFICATE OF SERVICE On May 20. I electronically submitted the foregoing document with the clerk of court for the U. Philbin Phillip B.

References: § 1391
 § 1338
 § 101
 § 1121
 § 1051
 § 1367
 § 2
 § 2
 § 102
 § 504
 § 1065
 § 1114
 § 1125
 § 101