Winklevoss twins lose yet again in Facebook case

Cameron and Tyler Winklevoss and their business partner Divya Narendra on Monday lost another round in their legal battle against Facebook when the Ninth Circuit Court of Appeals in San Francisco declined to re-hear a case challenging the trio’s 2008 settlement agreement with the social media company.

In a press release, attorneys for the Winklevosses and Narendra said they would seek to have their case heard before the US Supreme Court. (The lawyers will file a writ of certiorari, which will attempt to make the case that the Winklevoss-Narendra suit is worthy of US Supreme Court review; the justices of the High Court can then choose to accept or deny the case.)

The attorneys said the case should be taken up by the Supreme Court because:

Settlements should be based on honest dealing… The [Ninth Circuit] Court’s decision shut the courthouse door to a solid claim that Facebook obtained this settlement by committing securities fraud. Our Petition to the Supreme Court will ask the high court to decide whether that door should be reopened.

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The court had previously held that as “sophisticated parties,” the three Harvard grads went into the deal with their eyes open .

[caption id=“attachment_10752” align=“alignleft” width=“380” caption=“The Winklevoss twins and Divya Narendra lost another round in their legal battle against Facebook. Justin Sullivan/Getty Images”]  [/caption]

But the Winklevosses and Narendra asked the Ninth Circuit for a re-hearing on their settlement because they maintained that Facebook CEO Mark Zuckerberg had engaged in securities fraud by misleading them about the value of the 1.2 million shares of Facebook stock that they were to receive.

The 2008 settlement,which some believe could be worth as much as $200 million, depending on the valuations of Facebook stock, resulted from a lawsuit that the Winklevosses and Narendra filed in 2004 against Zuckerberg. In a story that has since been made famous by the film “Social Network,” the threesome claimed that Zuckerberg stole the concept and code behind ConnectU, a social media company for Harvard students that they were in the process of developing.

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The ConnectU founders could still choose to appeal the Ninth Circuit decision to the US Supreme Court.

The litigation that keeps on ticking…

A model of legal perseverance, the Winklevosses and Narendra have also asked a court in Boston to conduct an inquiry into whether Zuckerberg hid text message evidence from them during the original litigation of their case.

Although some online observers have called the ConnectU founders greedy and spoiled in their demand for more money, there’s at least one more person who’s hoping that the trio are able to convince Facebook to write them a larger cheque.

His name is Wayne Chang, and he claims to have developed a peer-to-peer file-sharing system in partnership with ConnectU. Chang is upset with the Winklevosses and Narendra because he says he was excluded from a patent filing on the technology; he filed a lawsuit against the group in December 2009 demanding a portion of the Facebook settlement. In late April, a Massachusetts superior court ruled that some of his claims can move forward in court.