Claiming the value of a settlement they received from Facebook was skewed, Zuckerberg’s former classmates, pictured on the right, are going for double or nothing.
Although Facebook’s Mark Zuckerberg settled what he called a "rancorous suit" ? their claim of idea theft for $65 million ? his Harvard classmates aren’t satisfied. They now say the valuation of stock they received in the deal was skewed.
The pros and cons of whether Zuckerberg pulled a coup out of a relationship with the disgruntled plaintiffs, or whether a couple of them are just elite spoil sports who rowed for the Beijing Olympics continues to remain in the headlines.
The Winkevoss twins, Tyler and Cameron, together with Divya Narendra created a program called Harvard Connect, later dubbed ConnectU, when social networks were becoming the rage at colleges across the country.
All three were included in the original, and now the new, law suit. They have asked a three-judge panel of the US 9th Circuit Court of Appeals in San Francisco to void the settlement. They are going for an all-or-nothing approach. They’ll either forfeit what they received which has been in escrow, or they’ll come out ahead. Big bet, dontcha think?
However, the San Francisco law firm for the plaintiffs told Bloomberg that lawyers on both sides made errors in the 2008 settlement. They are going for a bigger piece of the pie since estimating that the two-year old settlement is now worth about $100 million more than when it was reached. Why?
Well, in addition to the success of Facebook, Goldman Sachs Group invested $450 million in the social-networking site. Keep in mind that the hope for "IPO" is never ending. The author of a semi-official bio about Zuckerberg, David Kirkpatrick, thinks the Winklevoss duo is
just desperate to get credit for something. They are media hounds and the irony is they are obsessed with being famous and Mark is so obsessed with being obscure; yet he is the one that has really accomplished something.
The plot thickens as Winklevoss, et al, is being sued in turn by Wayne Chang who thinks he is also entitled to some of the original $65m settlement. Why?
He had merged his file-sharing network called i2hub with ConnectU several years earlier. Since the purchase of ConnectU by Facebook was included in the Winklevoss/Facebook settlement, Chang wants his percentage.
Divya Narendra , played by Max Minghella in The Social Network movie (maybe up for an Academy award, some say) about the whole Facebook/ConnectU fiasco learned something from the litigation he experienced during the original conflict with Facebook.
He said it taught "the importance of building a team and formalizing certain business processes. I learned to trust my instincts, but also how the law can in many circumstances inform business decisions."