Recently, Total Recall Technologies, a Hawaii-based company, filed a lawsuit in a California U.S. District Court claiming fraud, breach, and other allegations against Oculus VR Inc. The lawsuit involves reality glasses, a product that has been touted by Oculus VR over the past three years, according to news reports. In 2014, social media giant Facebook purchased Oculus for a reported $2 billion. Now, Total Recall Technologies alleges that patented information from the company was taken by Oculus founder Palmer Luckey during the time he was employed by the company to develop a prototype head-mounted display product.

Luckey signed a confidentiality agreement, according to the complaint which requests punitive and compensatory damages from Oculus. The lawsuit also alleges that Luckey developed the converted information in order to market the Oculus Rift, his own virtual reality headset, violating agreements with Total Recall Technologies. While Luckey may argue that he used his own plans and knowledge in the development of the virtual reality headset, news article say the dispute is quite complex and highly fact-specific, entailing a thorough discovery process in order to learn what Luckey knew and whether he did actually breach or violate any specific provisions in the contracts between the two companies.

Did Luckey develop his product in a way that is different and unique from the products he may have worked on when associated with TRT, based on his own knowledge and plans, or were the agreements of any contracts between the two companies violated? A Reuters article states that Luckey was hired in 2011 by TRT to build a prototype head mounted display; at that time, he signed a confidentiality agreement, however the founder of Oculus is accused of using information he learned from his partnership when launching the Facebook Oculus Rift VR (virtual reality) headset.

Total Recall Technologies is seeking an unspecified amount in compensatory and punitive damages in the lawsuit against Luckey and Oculus.

Strangely, it is a bit curious as to why TRT has waited so long to bring a lawsuit against Oculus VR and Luckey. Perhaps the company decided to go forward at a point when Facebook became the owner of Oculus? A representative for the company says that the case is “meritless,” and that Oculus will be vigorous in its defense against TRT.

The lawsuit claims, according to Polygon, that “Without informing TRT, Luckey took the information he learned from the partnership, as well as the prototype that he built for the TRT using design features and other confidential information and materials supplied by the partnership, and passed it off to others as his own.”

Of the current modern virtual reality headsets, the Oculus Rift is the most widely known according to a Forbes article, and is scheduled to become available in the market during the first quarter of 2016 following a hugely successful Kickstarter campaign that resulted in raising $2.4 million, a drop in the bucket when compared to the $2 billion Facebook invested.

As highly experienced Los Angeles business attorneys and intellectual property attorneys, we understand that working with new technological advances may complicate already complex industries. Yet the huge majority of costly lawsuits and conflicts such as these are avoidable with the help of an experienced legal professional. If you are a former employee or an employer facing similar circumstances, contact Spotora & Associates, PC for the best way to proceed today.

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