Winklevoss Twins Must Accept Facebook Deal
The Winklevie battle with Mark Zuckerberg we all learned about in The Social Network is now over. I’m still on the fence about who is right.
(Reuters) – Mark Zuckerberg won a legal battle against former Harvard classmates who accuse him of stealing their idea for Facebook, but the feud made famous on the silver screen is not over yet.
Cameron and Tyler Winklevoss must accept a cash and stock settlement with Facebook that had been valued at $65 million, a U.S. appeals court ruled on Monday. Meanwhile, a New York man filed an amended lawsuit against Zuckerberg on Monday, citing a 2003 email in which Zuckerberg discusses an urgent need to launch his site before “a couple of upperclassmen” could launch theirs, an apparent reference to the Winklevoss twins.
The Winklevoss brothers argued their settlement with Facebook was unfair because the company hid information from them during talks. But the twins were sophisticated negotiators aided by a team of lawyers, 9th U.S. Circuit Court of Appeals Chief Judge Alex Kozinski wrote for a unanimous three-judge panel.
“At some point, litigation must come to an end,” Kozinski wrote. “That point has now been reached.”
An attorney for the brothers, Jerome Falk Jr., said on Monday his clients would seek a rehearing before a larger, “en banc” group of 9th Circuit judges.
That larger group can overrule a three-judge panel, although only a fraction of cases undergo such a review. Should the 9th Circuit refuse to rehear the case, the last option would be an appeal to the U.S. Supreme Court.
Falk said he “respectfully” disagreed with the 9th Circuit’s conclusions.
The 6-foot, 5-inch (1.96-meter) Winklevoss brothers are Olympic rowers who participated in the 2008 games in Beijing, and their saga with Zuckerberg was dramatized in the film “The Social Network.”
In the movie, actor Armie Hammer played both identical twins. Zuckerberg’s character snidely called them on-screen the “Winklevi.”
FACT AND FICTION
The twins, along with Divya Narendra, started a company called ConnectU while at Harvard. They say Zuckerberg stole their idea. Facebook denies these claims.
Facebook took in $1.2 billion of revenue in 2010’s first nine months, according to documents that Goldman Sachs provided to clients to entice investors in a special fund set up to invest in the giant social networking firm.
The company was valued at $50 billion as part of that transaction. The company said on Monday it is evaluating the Internet market in China, but a source indicated it has not yet signed a business deal with any companies there.
The Winklevoss twins and Narendra agreed to a settlement that had been valued at $65 million. But they argue that, based on an internal valuation that Facebook did not reveal, they should have received more Facebook shares as part of the deal.
A lower court had granted Facebook’s request to enforce the settlement with the Winklevoss twins and Narendra. The 9th Circuit agreed on Monday.
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