A federal judge in California is letting a civil lawsuit proceed against Oculus founder Palmer Luckey for alleged breach of a nondisclosure agreement (NDA).
Total Recall Technologies (a Hawaiian partnership) claims that Luckey agreed to build 3D virtual reality glasses for the company pursuant to a written “non-disclosure, exclusivity, and payments agreement.”
According to Total Recall, Palmer Luckey’s work was to be performed based upon the company’s pending patent for a “[s]ystem and method for creating a navigable, three-dimensional virtual reality environment having ultra-wide field of view.”
However, the company alleges that Luckey breached this confidentiality agreement and launched a Kickstarter crowdfunding campaign to build “a highly immersive, wide field of view, stereoscopic headmounted display at an affordable price – a device that Luckey named the Oculus Rift.”
Whether there was an enforceable nondisclosure agreement between Total Recall and Luckey that was breached remains to be seen if there’s no settlement reached before trial.
Millions of dollars are at stake. Total Recall is seeking compensatory, exemplary, and punitive damages in addition to other remedies.
There are two important lessons you can learn from this breach of nondisclosure agreement lawsuit.
- Whether you’re paying a hardware developer or a software developer, a professionally written contract (employment contract or independent contractor agreement) that contains confidentiality provisions is important to protect your intellectual property rights.
- Any contract (including a confidentiality agreement) is only as good as the parties who sign it. If both parties are honest and acting in good faith, it’s unlikely you’ll end up in an expensive courtroom fight over whether misconduct occurred during performance of the agreement.
See Total Recall Technologies v. Palmer Luckey et al. (N.D. Cal. Docket No. 15-cv-02281)
