Twins Drop Case Against Facebook

KudoSurf Me!Follow @twittablogga My Store! Check it out!

A fight that inspired a movie about Facebook Inc. has seen its finale.

Cameron and Tyler Winklevoss, Harvard University classmates and former business partners of Facebook founder Mark Zuckerberg, have decided not to further appeal a settlement in their long-running dispute over the origins of the social-networking site.

But the Winklevoss twins—former Olympic rowers—and fellow business partner Divya Narendra still will walk away with stock that should be worth hundreds of millions of dollars, following a fight that was dramatized last year by the Hollywood film "The Social Network."

On Wednesday the Winklevosses and Mr. Narendra, who founded a company called ConnectU, filed papers with the U.S. Court of Appeals for the Ninth Circuit in San Francisco saying that after "careful consideration" they wouldn't file a petition to take their battle to the Supreme Court.

A Facebook spokesman said, "We've considered this case closed for a long time, and we're pleased to see the other party now agrees."

It wasn't immediately clear what triggered the decision by the Winklevosses to drop the case, which has dragged on since Mr. Zuckerberg created Facebook in his Harvard dorm room in 2004. A lawyer for the Winklevosses and Mr. Narendra declined to comment.

In April, an appeals court ruled that the ConnectU partners had to live with a settlement they struck with Facebook in 2008 to resolve their claim that Mr. Zuckerberg stole their idea for a social network for Harvard students. The original settlement awarded them $20 million in cash and $45 million worth of private Facebook stock at a time the company was valued at $15 billion. On private exchanges, Facebook shares subsequently have changed hands at prices valuing the company at as much as $70 billion.

Almost immediately after the settlement, the Winklevosses complained that Facebook left out important information during the negotiations, which resulted in them receiving fewer Facebook shares than they might have. They began legal proceedings to throw out the settlement, but a series of courts ruled that it had to stay in place.

The twins' move to abandon the case doesn't bring an end to legal challenges concerning Facebook's early days. Mr. Zuckerberg is currently fighting a battle with Paul Ceglia, a New York state wood-pellet salesman who has argued that a 2003 contract with Mr. Zuckerberg gives him claim to a large stake in the company. Facebook has called Mr. Ceglia's claims "fraudulent."

Via WSJ