Here’s the Agreement Oculus Broke, According to ZeniMax

http://recode.net/2014/05/01/heres-the-agreement-oculus-allegedly-broke-according-to-zenimax/

by comex • 12 years ago

82 66 12 years ago

subdane• 12 years ago

I think the title of this article is misleading. This is an agreement between Id and ZeniMax not ZeniMax and Oculus. The implication of the article is that Carmack violated this agreement (he didn't sign this agreement Id's lawyers did) and didn't negotiate an exception for Oculus in the same fashion as he had for Armadillo Aerospace

Edit: For clarification I don't think Oculus "broke" this agreement, perhaps Carmack did though.

rrouse2• 12 years ago

The NDA says that it's an agreement between Id, on behalf of Zenimax, and Luckey (Occulus)

georgemcbay4• 12 years ago

The agreement is between ZeniMax/id and Palmer Luckey (id and ZeniMax are functionally the same entity here, so I think you might be confused on that part of it).

Palmer Luckey is the founder of Oculus and for all intents and purposes at the time this was signed, Luckey was Oculus.

DonGateley• 12 years ago

So pay them. There, that's cleared up.

rrouse2• 12 years ago

I've always hated the notion of "We pay you some small amount to own you 24/7."

In my opinion, what I do outside of work hours is mine and mine alone. I always make sure I state that explicitly and modify any contract that tries to do otherwise.

famousactress2• 12 years ago

It's definitely icky. I don't sign those things anymore, but then I don't get paid enough to. I do wonder how these negotiations go though for someone at Carmack's level. These contracts aren't compulsory... Carmack apparently understood that enough to work out an exclusion for Armadillo... and certainly there's a price at which I'd happily sign one of those agreements (though I can't imagine anyone paying it), so it's not clear to me yet which side of this I'd fall on, despite really despising those kinds of employment contracts.

georgemcbay4• 12 years ago

I don't know anything specific about the details of any of Carmack's contracts; but certainly when signing them you have a lot more leverage to carve out exclusions when some other company actively wants to buy "you" and your company than you do later when it is clear to everyone that you're on the way out the door.

Armadillo was started way before ZeniMax acquired id (thus easy to foresee needing a documented exclusion), whereas Oculus VR wasn't even a thing until a few years after that was a done deal.

malandrew3• 12 years ago

Could Carmack leave Oculus and have Oculus hire Armadillo as a contractor paid in a form of cash and equity/options?

yoshokatana• 12 years ago

I nearly turned down my current job because they were using a default contract that had clauses like that in it. It also said that they have control over everything on my computer, despite the fact that the laptop I bring in for work is my own personal laptop.

I ended up spending about an hour with their lawyer reviewing and amending the contract until those kinds of clauses were completely taken out. Lucky the lawyer was very amenable to the changes.

Always read the fine print, and don't sign anything if you're at all uncomfortable with it.

Jare• 12 years ago

(IANAL etc)

I don't think "work hours" is really an applicable concept for someone in Carmack's position - he's not a 9-to-5 worker, his life and work are surely much more entangled.

It's hard to deny that Carmack's involvement in VR was linked to his position at id (Zenimax by extension) in a way that Armadillo for example was not; if nothing else, he did talk (show?) Rift versions of id properties. However, his image, popularity, visibility and even open promotion of Oculus are not really at issue here, at most they would have been grounds for disciplinary action from Zenimax at the time.

It's up to Zenimax to prove exactly what sort of tangible, protected IP and 'know-how' was transferred to Oculus. During 2012 he tweeted often about his research on lag, and I imagine his work was more extensive than what he publicly disclosed. If there's any link between that work and any properties of Zenimax, say a computer, email address, code or assets owned by Zenimax and used in any way to do VR-related work that Oculus took advantage of (even if it's not in use today), then there will be blood, pain and tears.

rasz_pl2• 12 years ago

Carmack also tweeted and spoke often about Zenimax refusal to touch VR and support Occulus. He basically said Doom 3 BFG Edition VR support was done by him OFF the clock and he would have to buy HIMSELF from his own money all the copies that went with Occulus KS fulfilment.

Basically Zenimax didnt want to do anything with VR while he was there, but now those slimy lawyer cockroaches want piece of the action.

Arjuna2• 12 years ago

This pretty much says it all...

"Oculus uses zero lines of code that I wrote while under contract to Zenimax."

https://twitter.com/ID_AA_Carmack/status/462000400996921344

sdoowpilihp• 12 years ago

Though I don't know all of the specifics of this case, there is more to consider than whether or not code was used. Certain types of algorithms, concepts, processes, etc. are possibly protectable and could fall under question.

That being said, my sense is that Zenimax is having a bit of regret for not investing early and are trying alternative methods to get "their share".

georgemcbay4• 12 years ago

From a legal perspective, yes, there are more things to consider.

From a common sense perspective, ZeniMax AFAIK wasn't even working on VR at this time period other than Carmack dabbling in his own "free time", so this is a pretty naked attempt for them to make the claim that anything he worked on even remotely related to games is owned by them, which I have a huge issue with (even if it is a concept that holds legal water in some states).

I'd have more sympathy for ZeniMax if they were bullish on VR and Carmack was working on an official project for them in the VR space and then left for another company, but this doesn't look like that at all, this looks like a game company owned by a lawyer trying to get a big payday on an opportunity they previously missed the boat on, using tenuous legal technicalities.

hosh• 12 years ago

That's my read as well: ZeniMax wants a piece of the action.

sdgsdgsdg3• 12 years ago

I cannot understand the logic that could make this kind of contract enforceable.

By this reasoning, the patent office employing Albert Einstein owned the theory of Special Relativity and presumably therefore a stake in subsequent commercialised technological development?

It makes me feel physically sick that this is a thing.

I had a probably similar clause in an old contract, anything I built or indeed thought, in or out of work belonged to the company.

mcv• 12 years ago

Certain types of algorithms, concepts, processes, etc. are possibly protectable and could fall under question.

Only if they have been explicitly protected. Copyright is the only protection that's automatically granted; patents need to be filed explicitly. If Carmack's claims are correct that none of his work has been patented, and that Oculus didn't use any code that he wrote while in the employ of Id, then he's in the clear and ZeniMax doesn't have a leg to stand on.

rosser• 12 years ago

No, it doesn't. Under the currently accepted, legally binding definition of Intellectual Property, that category includes far more than just code.

Note, I'm not saying ZeniMax owns a bit of Oculus or their IP. I don't have enough information to speculate meaningfully either way, and neither do you.

Lazare• 12 years ago

A bit confusing, but as near as I can tell, the contention is:

1) Id software claims they own the work Carmack did while working for them unless an exception had been made in his contract.

2) An agreement was signed between Id and Oculus saying Id retained ownership of the work they owned.

This story contains a copy of the agreement, and a quick skim indicates it says what Re/code claims it does. IF Id owned Carmack's work on VR, then it would seem they still do so, and Oculus does not (ie, point 2 is correct).

The question that isn't answered here is, well, does Id own Carmack's work? The fact that Carmack's contract apparently had a specific exclusion for Armadillo Aerospace, but did not have one for Oculus is very suggestive (why negotiate any exceptions unless exceptions are indeed needed?), but not dispositive. Seems like the real dispute is going to end up being between Id and Carmack; Oculus is kind of a bystander.

If I was advising Carmack, I'd strongly suggest he engage a lawyer. He's probably getting legal advice from Oculus's counsel right now, but there's a long, long, LONG history of people getting screwed over by their employer's lawyer (who works for the employer, not for the employee, and has no duty to offer legal advice in the employee's interest!). Tweeting that Oculus doesn't use any code written while Carmack was at Id is all well and good, but it's got nothing to do with the core issue. I'd hate to see Carmack accidentally admit to something that'll screw him over later.

JabavuAdams• 12 years ago

Tweeting that Oculus doesn't use any code written while Carmack was at Id is all well and good, but it's got nothing to do with the core issue. I'd hate to see Carmack accidentally admit to something that'll screw him over later.

I'm actually kind of shocked that he tweeted anything at all. Wouldn't his lawyer basically tell him not to say anything?

sheetjs2• 12 years ago

He's probably getting legal advice from Oculus's counsel right now, but there's a long, long, LONG history of people getting screwed over by their employer's lawyer (who works for the employer, not for the employee, and has no duty to offer legal advice in the employee's interest!).

It's in the employer's best interest to distance Oculus from Carmack.

anigbrowl5• 12 years ago

I find it hard to believe that a successful individual like John Carmack wouldn't already have a lawyer or indeed a whole team of them, and know that lawyers' obligations are to the clients that pay them. This isn't exactly his first rodeo.

stonemetal2• 12 years ago

More to the point what work are they claiming Oculus has illegally? We know Carmack was involved with Doom 3 BFG which supported Oculus' hardware. Are they claiming Oculus has Doom 3 source when they shouldn't? Carmack's tweet that they don't have any of Id's source makes that seem unlikely.

Arjuna2• 12 years ago

Solid analysis.

What I want to know is... what exactly is enforceable, in this specific case?

The reason that I ask is that, Carmack has stated that nothing he has worked on has been patented ("No work I have ever done has been patented." [1]), so, presumably, there is nothing to enforce in that area with regard to code or algorithms.

Also, Carmack has publicly discussed many VR details in technical blog posts and demonstrations, but to my knowledge, we have not seen ZeniMax attempt to prevent these discussions from occurring (i.e., Cease and Desist). Presumably, those details were not viewed as critical to this discussion, but it is an interesting point to note.

I suspect that concepts and processes could be covered under trade secret IP law, but in the case of software in specific, it would seem the safer bet to have patents in place if possible (but again, according to Carmack, he has not worked on patentable work.) The question here is, "If ZeniMax saw potential IP to enforce, then why didn't they attempt to protect it via patents?"

I am officially raising the grellas [2] Bat Signal. I would love to read his thoughts on this topic in general.

[1] https://twitter.com/ID_AA_Carmack/status/461918500307472384

[2] https://news.ycombinator.com/user?id=grellas

jacquesm• 12 years ago

No code is a hole large enough to drive a truck through, copyright covers a lot more than just code (for instance, design documents). The code written could easily be a derivative work of something that Id held copyright to.

That will be harder to prove than an outright copyright violation. But if any files made it from Id to Carmacks subsequent employers it is going to be very hairy.

ZeniMax may have found that the IP was already patented by other parties or that they decided they did not wish to patent it. That does not mean they relinquish all their rights.

staunch• 12 years ago

Robert Altman (CEO of ZeniMax) is an attorney. He knows they have just enough of a claim to muddy the waters and make life difficult for Oculus. He also knows Oculus is very likely to settle for more than they were offering him previously. This is exactly why people hate lawyers. Robert Altman of ZeniMax is an asshole.

bthornbury• 12 years ago

Even if Zenimax is claiming to own John Carmack's work, under what supposition do they make the claim that they own the knowledge in his head. Assuming he did not break a non-comptet e clause, how is it that they can claim that because he gained knowledge of how VR systems work, while working for them that they own that knowledge in his head?

I understand typical IP policies, that they definitely own any code he wrote and are capable of patenting ideas generated by him in that work. This seems to step beyond that however (if indeed he used no code from id software at oculus).

Perhaps I am being naive, but as a software developer, this seems to me that they are attempting to set a dangerously non-competitive precedent. Under this logic, because I learned how to do advanced SQL queries over an internship (assuming a similar IP policy), I could never write SQL for any other company. That is a much simplified analogy and is likely missing some specifics, but I would honestly like to know the basis for this type of lawsuit.

Patrick_Devine• 12 years ago

I'd really doubt a non-compete would be applicable in this case. Id has shown no signs of creating a VR headset, which was the reason why Carmack left in the first place.

In California (I have no idea about Texas), if Carmack worked on Occulus in his own time (ie. not at work), on his own equipment with software which was not owned by Id, then they would have absolutely no claim to anything written by him, regardless of whether there was an agreement in place. The code he wrote would be his own. They are, of course, welcome to sue him, but they're most likely going to lose unless they can prove he acted inappropriately. My guess is given Facebook's deep pockets, they're willing to take the risk, but I'm not sure I'd want to be up against that legal team.

clavalle• 12 years ago

This is one area where Texas comes through for employees. Non-competes are almost unenforceable here and if he didn't actually write anything that was used with their equipment or during normal work hours at the office he's likely in good shape.

xsmasher• 12 years ago

In California (I have no idea about Texas), if Carmack worked on Occulus in his own time (ie. not at work), on his own equipment with software which was not owned by Id, then they would have absolutely no claim to anything written by him, regardless of whether there was an agreement in place.

Citation for this? I know California law forbids noncompetes that restrict where you can find employment, but does it invalidate Intellectual property agreements too?

EDIT: Nevermind, found it and you are right. LABOR CODE, SECTION 2870-2872 http://www.leginfo.ca.gov/cgi-bin/displaycode?section=lab&gr...

There is an exception for works that "Relate [...] to the employer's business". That's probably what the lawsuit will hinge on.

speeder• 12 years ago

Only me find that is absurdly silly US companies behaviour of considering that ALL work of employees, even outside their work, is company property?

sdgsdgsdg3• 12 years ago

Nope, me too. It's the same in the UK.

rant This is a rare glimpse of the true nature of our world. We really do live in a time when individuals are owned by corporate entities. I cannot express the depth of my anger and revulsion at this horrendous state of affairs. Yet people talk about it as if it's something that is OK. They talk about it for a few minutes, shrug their collective shoulders and move on. It is not OK, this is not just one of those things. We seem to believe ourselves in some bright new dawn, an enlightened age full of magic, gods and joyous, eternal, unbroken song. It is a non-sense that the pitfalls of the past no longer apply. Do not make believe that things have changed, that the human spirit is no longer corruptible. I honestly think we need to be mindful of the fanciful seeming visions of some of our finest prophets. I will leave you with a quote: "If you want a vision of the future, imagine a boot stamping on a human face - forever." rant

anigbrowl5• 12 years ago

I don't think Oculus/Carmack has too much to worry about, as this agreement looks a bit shaky legally and it will b tricky to prove that Carmack has taken proprietary research with him (unless they have admissions ot this effect that we don't know about).

The reason I think the agreement looks shaky is that it picks Texas law as governing law, but also claims that the term of the agreement shall be 'in perpetuity', ie forever. Texas is one of only 3 US states that still holds to the common law rule against perpetuities, which says that no property interest is valid unless it explicitly vests within 21 years of the death of of the last party involved. [1]

Now this usually comes up in the context of probate law, where people are arguing over the terms of a will involving the disposal of a dead person's property. However, at least one case in New York (which, like Texas, follows the old common-law rule) has seen a similar case involving a software distributorship agreement, in which the court ruled the entire agreement void for lack of an explicit term. [2]

1. http://www.actec.org/public/documents/studies/zaritsky_rap_s...

2. http://blog.internetcases.com/2008/07/02/software-distributo...

Not a lawyer, not an expert on Texas law, and I only spent 15 minutes on this - but if it ever goes to court, I bet the firs thing that lawyers for Oculus/Carmack would do is move for summary judgment on the basis of contractual invalidity.

madrox• 12 years ago

Whether or not Carmack did anything wrong is beside the point. It's a long road in court to determining that, and Oculus doesn't want to be spending any time in a law suit when it's trying to close the Facebook deal. This will get a financial settlement quickly quickly so Oculus can get their billion dollar payday, which is what ZeniMax is hoping for.

rasz_pl2• 12 years ago

Not sure about that. FB has lawyers on the payrol, im sure they wont mind making them work for their oney for a change.

chaired• 12 years ago

This jackassery is like if DEC had gone after Microsoft for hiring Dave Cutler et al.

If every company always pursued every technicality allowed by our stupid laws, none of us would be free to change jobs.

edit: Apparently I couldn't have picked a worse example :| However, thinking about the similarities, I'm struck by the sense that these companies are basically seizing on a plausible excuse to extract millions from each other. But these actions diminish the autonomy of these programmers, reducing them to property.

gpcz• 12 years ago

Microsoft apparently made a deal with DEC after some Digital employees notified their senior management of how similar NT and VMS was. Microsoft paid them 65-100 million dollars (src: http://windowsitpro.com/windows-client/windows-nt-and-vms-re... ).

As Steve Yegge says in "Done and Gets Things Smart," Cutler and Carmack are the types of engineers that companies file lawsuits over when they are hired away. This is because they generate a lot of extremely visible value -- most programmers are not perceived by legal departments to be worth suing over like that.

Mikeb85• 12 years ago

It's absurd that this is even a thing. As far as I'm concerned an employer owns what you do for them, on their time, and with their equipment. Nothing more.

In no other industry can an employer claim ownership over ideas or 'expertise', it's downright medieval and I would expect more from the tech industry.

jbb555• 12 years ago

Regardless of the legal position ZeniMax are being asses. Unless this gets resolved I shall be avoiding giving them my money in future and encouraging others to do the same to the extent I can be bothered.

Here’s the Agreement Oculus Broke, According to ZeniMax

Related Stories