> In August 2012, ZeniMax began seeking compensation for the intellectual property, according to people familiar with the discussions. Negotiations continued on and off for nearly six months, with Oculus eventually offering ZeniMax a small equity stake, but no deal was reached, the people said. This past summer, Mr. Carmack joined Oculus, and earlier this year, five ZeniMax employees joined Oculus, the people said.
In February, ZeniMax asked Mr. Carmack to disclose all of the virtual-reality inventions he developed while working at ZeniMax, one of the people said.
it sounds to me like they are saying that John Carmack did VR work for Oculus while still at Id and then took his tech demo with him when he left Id/ZeniMax.
This seems like the kind of thing John had done in the past and no one cared when they were still Id software. Once they sold themselves, it seems like the parent company no longer considers this type of activity to be ok.
or put another way, it sounds like shades of Sergey Aleynikov (http://en.wikipedia.org/wiki/Sergey_Aleynikov), where a programmer does something he always does but once he leaves the company the company decides that they weren't cool with it after all.
Ugh, Zenimax legal is the worst. I mean, maybe they have a claim - Carmack was probably working on Oculus stuff while employed there - but I find the idea that businessmen own everything a programmer works on just because he's an employee abhorrent.
Or Carmack pitched an early version of the technology to Zenimax and subsequently worked on parts of what was eventually used by Oculus during work hours. Both pitching it as a work product and working on it during work hours gives Zenimax some standing to talk about it being done by one of their employees.
It's not really impossible to conceive that they might actually have a valid claim.
To have a valid claim, Carmack must have had copied some code or data he produced during those hours. If he merely recreated the work from memory, Zenimax have nothing.
Unless recreating non-patented work from memory is actually forbidden? That would be horrible.
Yeah, forgot about that. Such Faustian clauses are evil, and shouldn't be possible in the first place.
Nevertheless, this doesn't look like a Non-Compete Agreement violation, or we would probably have seen those words in the article. My guess is, Carmack haven't signed one (75% probability).
I agree that Carmack probably didn't not sign one. But they are very common among companies in the tech sector and they can be just as horrible as you imagine.
Their claim will be that any of Carmack's work on those topics, because he originally began his work under Zenimax, is recreating based on Zenimax's property, because Zenimax has a claim to the early prototype Carmack thought of when pitching the ideas and there's no good way to show that Carmack isn't using the knowledge of those topics created during that period for his current work.
It's essentially writing new code looking at your old source code, and hence directly derivative of work that Zenimax has a reasonable claim to.
No no no, there's a difference from re-creating work from memory, and re-creating work while looking at an old copy.
It is also possible to work back from first principles. Heck, many Free Software was written like that: by rewriting the proprietary parts, possibly one by one.
This is actually a complex issue. Based on my non-lawyerly understanding, there are a few levels...
1 - If your employment contract says that the company owns 100% of your work unless otherwise approved, you have limited legal standing. This means all side projects must be approved, or the company owns it.
2 - Some employment contracts are more specific that they only own what happens during working hours. This can be tough if you work on a project during working hours, and they reject it. You definitely can't take the code with you, but you can keep what's in your head.
3 - If you pitch a side project done on your own time to a company who only owns what's produced during your working hours, then you have a right to take it with you if you offer it to them and they don't want it.
I actually don't consider #1 so awful. As a prospective employee you should negotiate it with a price. Similar to if someone wants a very long non-compete. It's only immorale if they spring it on you after you start. If they hand it to you during salary negotiations, then you can put a price on it, or go elsewhere. ("I'm happy to accept a 1 year non-compete, if you pay me 5% more, and give me 6 months severance if I'm fired for any reason, including with cause.")
I consider #1 to be god awful, and I refuse to sign any contracts with such clause.
It would be similar to saying a book writer who's main job is a typist would have to get his book approved (and potentially denied), or an artist would lose rights to his works he makes during his free time. It's out of this world wrong.
Isn't it just a matter of price though? If I was ready to accept a job for 100K, and someone said, "We'll own your non-working hours IP and pay you 300k" I would probably do it. Then I would work for them for a year, and do my own stuff for two. Companies try to make people sign it for free, but I view it as a negotiable item with a price, rather than a morality issue.
1 - If your employment contract says that the company owns 100% of your work unless otherwise approved, you have limited legal standing. This means all side projects must be approved, or the company owns it.
Note that - depending on the details - state law my trump one of those "We own your brain 100% of the time, 24x7" sort of agreements, even if you did sign it. There are states where the law simply does not permit an employer to enforce such an overly broad claim to an individual's intellectual output.
Now if the work in question was legitimately done on "work time", in the course of a work related initiative, then it seems clear that the IP does belong to the employer in most cases.
The question to me (coming at this as a non lawyer) is where the line is between "the IP" per-se and general knowledge and know-how that you absorb by osmosis over time, and which you clearly should not be restricted from accessing. IOW, if Programmer A learns to use a "for loop" during his first programming job, does that mean he can never use a "for loop" again? Obviously not...
3 - If you pitch a side project done on your own time to a company who only owns what's produced during your working hours, then you have a right to take it with you if you offer it to them and they don't want it.
That certainly seems like the way things should be. :-)
If a programmer is compensated for his time working for a company i think the company has a right to claim the work produced during that time. If they pursue it, is a different question, but i think Zenimax has a valid argument here.
The problem here is the standard of salaried work in the United States. Your job pays you a salary to do some tasks specified in a contract, with no hourly minimum or maximum. So let's say you have a hobby that closely intersects, but does not overlap with your tasks at work. You make something valuable in your spare time. Does it belong to your employer, or could they plausibly claim damages?
Your salary covers the work you produce while you are at work. If you pursue unrelated side projects in your spare time, I don't see how anyone with half a brain can reasonably claim that they also own those projects (partially or wholly).
I hear some US company make you sign off your right to write anything on your own. Meaning, you agree that any code you write belongs to them by default. Sometimes, this is even a problem for Open Source contributions.
Paul Graham himself warned about this: he basically said that if you're thinking about launching a startup and are currently employed, you shouldn't write a single line of code, if only to be safe.
This state of affair is obviously twisted and wrong, but in this world, corporations have more say than the people. Of course they will push in that direction.
Nobody has said that he was working on this while "at work" or not while shirking his salaried duties.
Imagine you're a chef. You design and cook menu items at your day job, then you go home and make pasta alfredo in your own way. You go to a new restaurant and you bring your pasta alfredo influence to it. Should restaurant 1 have any rights to the pasta alfredo you designed at home that was not even in use at their restaurant? Should restaurant 1 be able to charge you for making your pasta alfredo at home?
Obviously the big issue here is stealing code snippets or working on other products on the clock of another employer. But the blanket "anything you make while employed here at any capacity is ours" is just ridiculous and needs to go away.
>but I find the idea that businessmen own everything a programmer works on just because he's an employee abhorrent.
Just to play devils advocate here, sometimes it is the businessman with the idea and the programmers who implement the idea and create the tech. Should the Idea man get the rights or the "workers" digging the trench.
A lot of large companies have policies that anything you make in your off time is owned by them. I can see why they do it my company has probably spent thousands on training and employee development and they want the return.
It may not be a popular thing for some people (including myself) but I see why they do it.
> A lot of large companies have policies that anything you make in your off time is owned by them.
And that's just wrong, plain and simple. There's no excuse this is allowed.
> I can see why they do it my company has probably spent thousands on training and employee development and they want the return.
Training someone is not a valid claim to all uses of those skills; off-time is off-time. Just because someone applies a skill they learned at work in their off-time in no way justifies the company owing that work.
As wrong as it may seem the courts still side with the companies.
What's to stop me from directly copying what I am doing at work and trying to compete with them? It wouldnt be fair if every employee you hired could just quit then rip you off once they figured out everything.
Fortunately my company has a process where you can legally clear your side projects as long as it isnt in conflict or competes with the company.
Sure, but I'm talking about right and wrong, not law. The law is fucked in innumerable ways.
> What's to stop me from directly copying what I am doing at work and trying to compete with them? It wouldnt be fair if every employee you hired could just quit then rip you off once they figured out everything.
That's theft, copying is not the same thing as rewriting in your own time.
That is actually not true. Any software you develop whether on company time or not belongs to you UNLESS you sign some type of intellectual agreement with the company prior to the development of that work.
At least in the US "a work prepared by an employee within the scope of his or her employment" is called "work for hire" [1], and the employer is the legal author for copyright purposes.
I've typed and erased this response 3 times because I tend to wander, but the I think what irks me the most about things like this is that they will end up concentrating on some physical object, like some code that he created in his spare time while still under their employment.
They won't even acknowledge the fact that this is a titan of productivity and a genius programmer who could probably conjure up anything he's written in the past N decades given an afternoon.
I came in here to post this exact quote. This is just super ridiculous. Any learning you did while employed is property of that employer. I seriously hope there no one comes up with a device that makes that possible to enforce.
Now I want to read a dystopian transhumanist novel where mind uploading is commonplace, but corporations force you to checkout a new "branch" of your mind-state while working for them, enforcing a rollback to a pre-employment commit after terminating employment.
I'm surprised they employed him at all, if that's their attitude.
If they expect "the proprietary ... know-how" and experience of all employees to remain confidential, then surely they can't have expected him to use any of the knowledge he gained working anywhere else previously, when he started working for them.
If that's the case, employing Carmack gains you nothing over employing a fresh new graduate, except that it costs a heck of a lot more.
Or are they just another bunch of fucking hypocrites?
Why would you assume Carmack did everything he gave to Zenimax in his time off?
It seems a lot more likely to me that he felt he was entitled to spend his time however he saw fit and did the VR work during work hours. I doubt if it would have even occurred to him to differentiate between "work time" and "time off".
People sign work for hire agreements all the time that grant ownership of everything to their employer. I cannot speak to the enforcement of these agreements, but they are common.
I wonder if they made him sign an employment agreement as a condition of their acquisition. It's common for these agreements to confer all rights in anything developed or conceived, on the clock or off, with or without employer resources, regardless of subject matter, to the employer. These provisions vary in their enforce-ability by state. Generally, if the IP relates to your job function, even tangentially, it can cause a lot of grief.
1) He refused John Carmack's pitch for a new project. Stupid.
2) That got his best employee to quit the company and start a new one. Double stupid.
3) That new company he has no rights to was worth $2 billion a year and a half later. Management-level stupid. (note I don't care what it's "value" is, someone paid 2 billion for it, that makes it worth 2 billion)
And now of course, the lawyer wants some money. It isn't fair that something I could have had but didn't want was sold for $2 billion ! Obviously they owe me for the idea !
I have a 2 year old daughter that has this sort of behaviour too. I also have a 5 year old daughter, who has grown out of it (that wasn't easy, let me tell you). I'd expect the CEO of a legal company to ...
Dammit I almost got through that last sentence without laughing ... and crying.
> Oculus has used and exploited ZeniMax's technology and intellectual property without authorization, compensation or credit to ZeniMax
When I read this, my thoughts went to all the smart people who created something awesome while employed at a company and were never personally credited.
The whole idea of a corporation and how we generally view this strange social/financial entity is giving me pause.
I mean, so much of our discourse is tied up in exchanging opinions of companies rather than individuals.
Feels a bit strange now I come to think of it. Having all these overbearing hierarchical organisations of people, that end up directly or indirectly controlling large parts of your life.
It's not a trade secrets case. Zenimax wasn't in the same business. Zenimax are claiming that they own everything he did while employed, thus, Oculus IP is zenimax IP. Typical tech company lawyer BS.
This is why you sign an exclusion clause when you start anywhere. I don't know why this is so crazy. Salaried employees are paid regardless of hours worked, which means that you are technically always employed, regardless if you're expected to be working.
If you're paid hourly, then there's a clear demarcation between working hours and not, being a salaried employee blurs that line. That's why many states have regulations as to who can be salaried and how.
"Salaried employees are paid regardless of hours worked, which means that you are technically always employed, regardless if you're expected to be working."
I don't know what third-world despot you've gotten stockholm syndrome for, but that is absolutely not true. Salaried employees can, and often do, have second jobs, run their own businesses, from restaurants to real estate ventures.
You are not the property of your employer. Salaried employment is an arrangement which cannot legally demand more than 40 hours of you. It often does, but I'd actually argue in those cases that the agreement is in breach and not binding at all.
Just because some states have stricter guidelines on how these lines can be drawn does not mean that you are ever the property of your employer.
From the DOL: "Being paid on a “salary basis” means an employee regularly receives a predetermined amount of compensation each pay period on a weekly, or less frequent, basis. The predetermined amount cannot be reduced because of variations in the quality or quantity of the employee’s work. Subject to exceptions listed below, an exempt employee must receive the full salary for any week in which the employee performs any work. "
Salaried employment isn't contingent on any hour requirement whatsoever. I could work 1 hour a week and still legally qualify for my salary. My employer could give me enough work to require that I stay in the office for 80-100h, and I would have to do so to fulfill the job duties.
I in no way stated that exempt employees can't have other employment. I have always maintained a consulting practice while working - what I can't believe is that people don't get it in writing that they are doing this, and carve out the things that their employer doesn't get to touch. Exemption/Exclusion clauses work both ways. It avoids this situation altogether. For a computer professional who branches out into other semi related tasks, I would consider this essential. Plus, I think that there's a large difference between something completely out of your field (like the real estate and restaurant ventures mentioned) and another software/gaming company.
I've had employers make me sign contracts that strictly forbade moonlighting and anything I developed while employed there belonged to them. I no longer work there, and don't sign agreements like that anymore, but they exist and aren't terribly uncommon.
That's one interpretation, and one that the lawyers would like us to buy into.
Another is that this is simply morally wrong, and we shouldn't accept that simply being salaried implies that all intellectual work you do is owned by the employer.
This is a matter of convention, expectation, and interpretation, not rules. Powerful corporations are fighting for the interpretation that most benefits them at the cost of those who are weaker. That's not crazy; it's wrong.
Most exclusion clauses are narrow -- limited to work you do in line with your companies current or imminent business interests or done with their equipment. When they are not they are unenforceable in most states, especially Texas which does not look fondly on companies keeping their employees from the market, surprisingly enough.
Not to mention that Carmack was an employee of a company he owned, id, that was later acquired. I doubt he even has an exclusionary provision that he'd signed that was anything but very friendly to how he likes to operate if at all.
Unless part of his agreements with Zenimax required him to provide all necessary assistance and documentation so that they can patent his work, which many agreements do...
Also, they may own it as a trade secret rather than as a patented process. Or, further, it's possible that code that John is working on now is a derivative work of code owned by Zenimax. We won't know until the facts come out.
When you are acquired for $2 billion, know that there will be hundreds of lawyers looking to find a way to sue you and get some of that Facebook stock.
I think it's worth pointing out that ZeniMax has been pursuing this since 2012, long before the Facebook acquisition. At least according to this article on ArsTechnica:
it might be true that they were pursuing it earlier, however, according to the WSJ article that is the source for all this, the lawyers didn't get involved until after the Facebook announcement.
The letters from ZeniMax's lawyers came after Facebook struck its deal to acquire Oculus, part of the company's efforts to leap from a social-media platform to a major player in the race with Google Inc., Apple Inc. and Amazon.com Inc. to be at the forefront of Internet use.
> To be completely clear, Zenimax is claiming that John Carmack took software with him to Oculus VR that he developed while still an employee at id Software (owned by Zenimax).
But:
> 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.
My guess: it sounds like John Carmack began an informal relationship with Luckey and Oculus, and possibly wrote some code for or advised them while he was still at iD. If so, Zenimax is likely legally in the right. Yikes.
I find it hard to imagine that an industry veteran like Carmack would write code for another company while employed with another and proving some bit of proprietary advice was incorporated into the product would be difficult.
My guess is that Zenimax wants to get access to the source to go on a fishing expedition.
Are you familiar with Carmack at all? Like, ever talked with him?
He's friendly and is exactly the sort of engineer that helps teach others how to do things--just look at the GPL releases of all the old Quake stuff when it came out (back in the 90s!).
> I find it hard to imagine that an industry veteran like Carmack would write code for another company while employed with another and proving some bit of proprietary advice was incorporated into the product would be difficult.
Back in the day id programmers shared snippets of code with whoever they wanted - they didn't need to ask any corporate overseer for permission. There were a few little bits found when the GarageGames/Tribes engine code was first released, for example. (pretty sure they got those lines of code from Brian Hook, but it's been a long time...)
It seems like Carmack produced Oculus demos of Id software before he left Id. May be he worked with the Oculus guys to support that effort and talked them into making changes to make those demos work. It would be rather unsurprising to me, close working relationships between game studios and hardware vendors (like graphics card, and console companies) happen all the time.
Hmm...sounds quite hairy, and quite likely that Carmack did, to some extent, leverage existing proprietary id software to assist in developing Rift's SDK or whatever before he left. I mean, who wouldn't? But at the same time, you'd think someone like Carmack would be aware of the murkiness of using company IP to make something...and then taking that something to another company.
This looks more like typical tech lawyer company bullshit where they claim that to basically own your brain while you're employed including anything you did during your time off.
A gaming giant going against a gaming legend, not sure if Zenimax thought this one through. Also doesn't Carmack still own a portion of id software and thus Zenimax? Carmack tried to get them to pursue VR but they didn't want to. Sounds like a bratty response to a bad decision.
They just can't resist the pile of money that Facebook paid for Oculus. Getting a slice of that might be more profitable than writing new software, unfortunately. Goodwill be damned.
Honestly, the details in something like this don't matter. ZeniMax is betting on Oculus not wanting a spurious legal claim holding up the closing of the Facebook deal. Oculus leaders don't really care, because they just want their big payday. Oculus will settle, ZeniMax will get some money, and we'll all move on.
This reminds me of _Count Zero_. The whole plot about a scientist leaving one corporate nation-state to work for another, and having to be extracted by a team of commandos so his old bosses don't kill him.
it sounds to me like they are saying that John Carmack did VR work for Oculus while still at Id and then took his tech demo with him when he left Id/ZeniMax.
This seems like the kind of thing John had done in the past and no one cared when they were still Id software. Once they sold themselves, it seems like the parent company no longer considers this type of activity to be ok.
or put another way, it sounds like shades of Sergey Aleynikov (http://en.wikipedia.org/wiki/Sergey_Aleynikov), where a programmer does something he always does but once he leaves the company the company decides that they weren't cool with it after all.