Tech giant Facebook has lost a $500m (£394m) court battle over the virtual reality technology behind it Oculus Rift headset.
After a three week trial, the jury decided that Oculus – acquired by Facebook three years ago – was manufactured using computer code written by game developer Zenimax.
Oculus said it would appeal against the "disappointing" decision.
Damages will be paid by Facebook, Oculus and Oculus executives – Oculus co-founder Palmer Luckey was found to have breached a non-disclosure agreement.
Zenimax chief executive Robert Altman said: "We are pleased that the jury in our case in the US District Court in Dallas has awarded Zenimax $500m for defendants' unlawful infringement of our copyrights and trademarks.
Oculus claimed a small victory after the jury found that it has not misappropriated Zenimax's trade secrets.
An Oculus spokesperson said: "The heart of this case was about whether Oculus stole Zenimax's trade secrets, and the jury found decisively in our favour."