ZeniMax Media on Wednesday said it struck a deal with Facebook-owned Oculus to settle a lawsuit over the video game giant's virtual reality technology.

A US jury early last year ordered that Facebook and creators of Oculus Rift pay $500 million in a lawsuit that contended that Rift virtual reality gear was developed using source code illegally obtained from the Maryland-based gaming firm.

The jury dismissed the charge that Oculus stole or misappropriated trade secrets but did find Oculus liable for copyright infringement and other violations.

The federal court in Texas where the trial took place subsequently cut the damages award to $250 million, and the case was appealed.

Terms of the settlement were confidential, according to the companies.

"We're pleased to put this behind us and continue building the future of VR," a Facebook spokesman told said in response to an AFP inquiry.

Facebook acquired Oculus in 2014 for more than $2 billion and now sells Rift headsets as part of the social network's push into virtual reality.

ZeniMax released a statement by chief executive Robert Altman saying the company was pleased and "fully satisfied" by the deal to resolve the litigation.

"While we dislike litigation, we will always vigorously defend against any infringement or misappropriation of our intellectual property by third parties," Altman said.

Oculus co-founder Palmer Luckey departed Facebook not long after Facebook was hit with a big tab in the ZeniMax lawsuit -- and after he was criticized for covertly helping an online "troll" group that promoted memes in favor of Donald Trump during the US presidential election.

The ZeniMax lawsuit accused Luckey and his colleagues who developed Rift virtual reality gear with the help of source code from the gaming firm.

Luckey was ordered to pay $50 million of the jury award and another former Oculus executive, Brendan Iribe, $150 million.

ZeniMax had sought $4 billion in damages in the case, in which Facebook chief Mark Zuckerberg testified to defend his company.

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