Their dispute with Mark Zuckerberg has not only made their lawyers rich: But the brothers Winklevoss can not get there mouth full. But now the judges have spoken a word of command.
The Winklevoss twins, whose battle with Facebook founder Mark Zuckerberg became the focus of the Oscar-winning film The Social Network, have lost an appeal over the size of the compensation paid to them.
A US appeals court ruled on Monday that Cameron and Tyler Winklevoss must accept a cash and stock settlement with the social networking site that had been valued at $65m. The twins argued the deal was unfair because Facebook hid information from them during talks.
But US Circuit Court of Appeals Chief Judge Alex Kozinski wrote in a unanimous opinion: “The Winklevosses are not the first parties bested by a competitor who then seek to gain through litigation what they were unable to achieve in the marketplace.”
The 6ft 5in brothers, played by Armie Hammer in the film and referred to snidely by Zuckerberg’s character as the “Winklevi”, started a company called ConnectU while at Harvard with fellow student Divya Narendra. They say Zuckerberg stole their idea. Facebook denies these claims.
The three had agreed to a settlement but argued that, based on an internal valuation that Facebook did not reveal, they should have received more Facebook shares as part of the deal. 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. The company was valued at $50 billion as part of that transaction.
Judge Kozinski wrote of the Winklevoss appeal: “They made a deal that appears quite favourable in light of recent market activity. At some point, litigation must come to an end. That point has now been reached.”
Facebook deputy general counsel Colin Stretch said the company appreciated the court’s careful consideration of the case and was “pleased” it ruled in their favour.
Attorneys for the twins did not respond to a request for comment.
The Winklevoss case is not the only ownership dispute Zuckerberg is fending off. A New York businessman, Paul Ceglia, claims a contract with Zuckerberg to develop and design a website entitled him to an 84% stake in the social networking site.
In a setback for Ceglia, a judge in Buffalo, New York last month ruled the lawsuit must be heard in federal court. Facebook has repeatedly said it believes the lawsuit is fraudulent.