‘Social Network’ Twins Denied New Facebook Lawsuit Bid

SAN FRANCISCO (CBS /AP) — A federal appeals court ruled Monday that former Harvard University schoolmates of Facebook founder Mark Zuckerberg can’t undo their settlement over creation of the social networking site.

The 9th U.S. Circuit Court of Appeals said Monday that Tyler and Cameron Winklevoss were savvy enough to understand what they were agreeing to when they signed the agreement in 2008. The deal called for a $20 million cash payment and a partial ownership of Facebook. A third classmate, Divya Narendra, was part of the settlement with the twins but did not pursue the second lawsuit seeking to undo the agreement.

Monday’s ruling upholds a lower court decision enforcing the settlement during the six years of litigation that grew so contentious that the dispute was dramatized in the Oscar-nominated film, “The Social Network.”

The settlement is now worth more than $160 million because of Facebook’s increased valuation.

The twins had alleged they were misled about Facebook’s value when they agreed to settle their lawsuit that claimed Zuckerberg stole their idea to launch Facebook.

“At some point, litigation must come to an end,” chief justice Alex Kozinksi wrote for the unanimous three-judge panel “That point has now been reached.”

The twins alleged they were misled into believing the company was worth $35.90 a share because of an investment by Microsoft Corp. But they argued that the company later valued the company at $8.88 for tax purposes. The twins argue they would have demanded more stock in the company based on the lower valuation.

Kozinski said the twins were “sophisticated parties” when they agreed to the settlement during a mediation meeting.

“They brought half-a-dozen lawyers to the mediation,” Kozinksi wrote.

Facebook said Monday it was pleased by the ruling. Lawyers for the Winklevoss twins said they are reviewing the decision and have not decided on their next step. The twins could ask the Supreme Court to consider the case.

(Copyright 2011 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. Wire services may have contributed to this report.)

Comments

One Comment

  1. Steve says:

    Greedy punks. 20 million and some ownership of the company is a lot these days.

  2. notsolittleguy says:

    The criminal aristocracy can’t stand it when regular folks break ranks and do something bigger and better.
    They hate it even more when people aren’t intimidated by their army of lawyers and litigation by attrition tactics.
    @twins.. your fifteen minutes are up.

Leave a Reply

Fill in your details below or click an icon to log in:

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

More From CBS San Francisco

Get The New CBS SF Bay Area Local App
Got Our Weather App?

Listen Live