Monday, April 11, 2011

How do you know who won? The Winklevoss twins lost!?

It was a tough day for the Winklevoss twins. You probably know these guys from the movie The Social Network. They're the twins who liked to row and kinda sorta maybe had the idea for Facebook which was "stolen" by Mark Zuckerberg. Well, as the media is reporting today: Winklevoss Twins Lose Legal War with Facebook.

As the article explains, the twins were trying to undo a prior settlement agreement. But, they "lost" and are bound by the prior agreement:
The suit was originally settled for $65 million in 2008 . . . . The settlement is now worth more than $160 million because of Facebook's increased valuation.
That's losing!? I'm a pretty competitive guy, but I'll lose twice a day at that rate! That's the way litigation often ends though; it is not clear who won. As an attorney, if my client sustains $50,000 in property damage and I file a lawsuit on his behalf... and obtain judgment in his favor for $40,000, did we win (add some zeros if you want to compare it to Facebook litigation)?

What if I represent an employer in an employment discrimination case, and obtain summary judgment in its favor? Pretty clear win right? The employer who spent $50,000 defending the case in which it feels it did nothing wrong (a view reinforced by the summary judgment) may not see it as such a clear victory. Different parties have different goals. Ultimately, I think you need to look at your start position and compare it to your end position. Subtract out the costs of litigation (which are by no means confined to the purely financial costs) and see what's left.

In the case of the "Winklevii," they started this latest battle with a settlement agreement... and ultimately walked away with the same agreement. But, if you look back a little further, they started with a crappy website nobody cared about and ultimately got about $160 million after Zuckerberg turned the idea into Facebook. Sure, maybe they could have gotten more; I still think I'd call that a win.

Posted by Philip Miles, an attorney with McQuaide Blasko in State College, Pennsylvania in the firm's civil litigation and labor and employment law practice groups.

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