[Rushtalk] Why Did Facebook Fire a Top Executive? Hint: It Had Something to Do With Trump

Carl Spitzer cwsiv at juno.com
Fri Dec 7 17:58:17 MST 2018

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Facebook Inc. executive and virtual-reality wunderkind Palmer Luckey was
a rising star of Silicon Valley when, at the height of the 2016
presidential contest, he donated $10,000 to an anti-Hillary Clinton

His donation sparked a backlash from his colleagues. Six months later,
he was out. Neither Facebook nor Mr. Luckey has ever said why he left
the social-media giant. When testifying before Congress about data
privacy earlier this year, Facebook Chief Executive Mark Zuckerberg
denied the departure had anything to do with politics.

Mr. Luckey, it turns out, was put on leave, then fired, according to
people familiar with the matter. More recently, he has told people the
reason was his support for Donald Trump and the furor that his political
beliefs sparked within Facebook and Silicon Valley, some of those people

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Internal Facebook emails suggest the matter was discussed at the highest
levels of the company. In the fall of 2016, as unhappiness over the
donation simmered, Facebook executives including Mr. Zuckerberg
pressured Mr. Luckey to publicly voice support for libertarian candidate
Gary Johnson, despite Mr. Luckey’s yearslong support of Mr. Trump,
according to people familiar with the conversations and internal emails
viewed by The Wall Street Journal.

Mr. Luckey’s ouster from Facebook was a harbinger of battles that have
broken out over the past year over the overwhelmingly liberal culture of
Silicon Valley, which has given the tech industry public-relations
headaches and brought unwanted attention from Washington.

Executives from Facebook, Twitter Inc. and Google, a unit of Alphabet
Inc., have had to answer questions from lawmakers about potential bias
in their treatment of conservative viewpoints. Tech executives concede
that Silicon Valley is predominantly liberal—Mr. Zuckerberg said in
Senate testimony that it is “an extremely left-leaning place”—yet they
have steadfastly maintained that politics doesn't play a role in how
they police content on their sites.

Mr. Luckey, who is 26 years old, hired an employment lawyer who argued
to Facebook that it had violated California law, according to people
familiar with the conversations, in pressuring the executive to voice
support for Mr. Johnson and for punishing an employee for political

Then Mr. Luckey and his lawyer negotiated a payout of at least $100
million, representing an acceleration of stock awards and bonuses he
would have received through July 2019, plus cash, according to the
people familiar with the matter. The stock awards and bonuses were a
result of selling his virtual-reality company, Oculus VR, to Facebook in
2014 for more than $2 billion, a deal that netted him a total of about
$600 million.

A Facebook spokeswoman said in an email: “We can say unequivocally that
Palmer’s departure was not due to his political views. We’re grateful
for Palmer’s contributions to Oculus, and we’re glad he continues to
actively support the VR industry.”

Some people at Facebook say it is too simplistic to say Mr. Luckey was
fired over his politics, and that his lack of candor during the episode
involving the donation and his diminished role in Oculus operations were
larger factors.

Mr. Luckey, in an emailed statement, described the episode as being in
the past. “I believe the team that remains at Oculus is still the best
in the VR industry, and I am rooting for them to succeed.”

Mr. Luckey started Oculus in 2012, while still a teenager, with a $2.4
million crowdfunding campaign. He dropped out of the journalism program
at California State University, Long Beach, to work on the company,
along with co-founder Brendan Iribe. When they sold to Facebook, Mr.
Luckey became the face of the virtual-reality industry, appearing on a
Time magazine cover saying the technology was “about to change the

Mr. Luckey, a Long Beach native who was home-schooled by his mother, has
sometimes been out of step with the largely liberal culture of Facebook.
A fan of big cars and military gear, he drove a giant tan Humvee with
machine-gun mounts and orange toy guns. He once was forced to move it
from the Facebook parking lot after someone called the police in to
investigate, according to people familiar with the episode.

Mr. Luckey has been a longtime supporter of Mr. Trump and wrote a letter
to the then-reality-television star in 2011 urging him to run for
president. Mr. Luckey has told friends that reading Mr. Trump’s book
“The Art of the Deal” at age 13 sparked his entrepreneurial imagination.

Mr. Luckey’s fallout with Facebook began in September 2016, when the
Daily Beast revealed his $10,000 donation to NimbleAmerica, a pro-Trump
group that paid for advertising mocking Hillary Clinton ahead of the
2016 election. At least one billboard paid for by the group featured a
picture of Mrs. Clinton and the phrase “Too Big to Jail.”

In one post on a Reddit chain dedicated to supporting Mr. Trump, the
author, called “NimbleRichMan,” said he was donating to the group so it
could spread unflattering memes about Mrs. Clinton. In the same post,
the author professed to support Mr. Trump’s campaign, saying “Hillary
Clinton is corrupt, a warmonger, a freedom-stripper. Not the good kind
you see dancing in bikinis on Independence day, the bad kind that strips
freedom from citizens and grants it to donors.” The Daily Beast wrote
that Mr. Luckey had said he used the pseudonym NimbleRichMan.

Mr. Luckey’s donation and the perception he might be leading a pro-Trump
online campaign ignited a firestorm. Facebook employees expressed anger
about Mr. Luckey on internal message boards and at a weekly town hall
meeting in late September 2016, questioning why he was still employed,
according to people familiar with the complaints.

“Multiple women have literally teared up in front of me in the last few
days,” an engineering director, Srinivas Narayanan, wrote in one
internal post following the meeting. Mr. Narayanan didn’t respond to
requests for comment.

Some virtual-reality-game developers said they wouldn’t work with Oculus
in the future.

In an apology posted on Facebook that month, Mr. Luckey denied writing
the NimbleRichMan posts and said he “contributed $10,000 to
NimbleAmerica because I thought the organization had fresh ideas on how
to communicate with young voters through the use of several billboards.”

The post said Mr. Luckey is a libertarian and planned to vote for Mr.
Johnson in the election.

“I need to tell you that Mark [Zuckerberg] himself drafted this and
details are critical,” Facebook Deputy General Counsel Paul Grewal wrote
to a lawyer for Mr. Luckey in a September 2016 email, attaching an early
draft of the statement, according to the emails reviewed by the Journal.
The draft said Mr. Luckey wouldn’t be supporting Mr. Trump in the

Mr. Luckey has told people he did vote for Mr. Johnson, but only to
avoid having his credibility questioned if he was asked about the issue
under oath in unrelated litigation.

The apology went through many drafts, and Mr. Luckey ultimately approved
changes suggested by Facebook, according to people familiar with the
process. The statement didn’t include a public disavowal of Mr. Trump,
but did say he would support Mr. Johnson. Mr. Luckey has supported
libertarian candidates in the past.

The Facebook spokeswoman said that throughout the process, “we made it
clear that any mention of politics was entirely up to him.”

Soon after the apology was posted, a writer at the Daily Beast posted on
Twitter emails he had received from Mr. Luckey in which he said he made
at least one post attributed to NimbleRichMan—a contradiction of his
public statement. Mr. Luckey has since told people he wasn’t the author,
but took responsibility because the post reflected his views.

Facebook executives were irate about the conflicting statements, with
some believing that Mr. Luckey had lied to them, according to people
familiar with the matter.

Facebook launched a human-resources investigation, which in 2016 found
that Mr. Luckey hadn’t violated internal policies, say people familiar
with the investigation. His performance reviews were consistently
positive, including his last in June 2016, those people say.

Amid the uproar, Facebook placed Mr. Luckey on paid leave, the people
say. After Mr. Trump won the election in November, Mr. Luckey donated
$100,000 to his inaugural committee. By December 2016, he had returned
to work to prepare for and testify at a trial, although he was only on
campus for a couple of days.

A videogame publisher, ZeniMax Media Inc., had sued Facebook shortly
after it purchased Oculus, contending that a ZeniMax employee took
proprietary code when he joined Oculus. After a trial, a judge ordered
Facebook to pay $250 million, plus interest. Facebook has appealed.

After the verdict, Mr. Luckey got a call from a Facebook executive
asking him to resign, according to people familiar with the call. He
declined, seeking instead to get reinstated. Facebook said no.

Ultimately, Mr. Luckey was fired. His last day was March 30, 2017.

After the incident, Mr. Luckey became more, not less, political. One
month after he left Facebook, he hosted a fundraiser for Republican Sen.
Ted Cruz of Texas. He has since founded Anduril, an Orange County-based
tech company focused on using artificial intelligence to protect troops,
performing search-and-rescue missions and bringing “Silicon Valley
thinking and funding to defense,” according to its website.
Recently, Mr. Luckey came as close as he has ever come to publicly
divulging the circumstances of his Facebook departure. At Vanity Fair’s
New Establishment Summit in Los Angeles last month, he told CNBC that
“it wasn’t my choice to leave.”

Write to Kirsten Grind at kirsten.grind at wsj.com and Keach Hagey at
keach.hagey at wsj.com 


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