Judge: Winklevosses Can't Renege on Facebook Deal

A federal appeals court ruled today that former Harvard University schoolmates of Facebook founder Mark Zuckerberg can't undo their settlement over creation of the social networking site. The 9th US Circuit Court of Appeals said that Tyler and Cameron Winklevoss were savvy enough to understand what they were agreeing to when they signed the agreement in 2008. The deal called for a $20 million cash payment and a partial ownership of Facebook—now worth $160 million because of Facebook's increased value. "At some point, litigation must come to an end," chief justice Alex Kozinksi wrote for the unanimous three-judge panel "That point has now been reached."

The twins alleged they were misled into believing the company was worth $35.90 a share because of an investment by Microsoft Corp. But they argued that the company later valued the company at $8.88 for tax purposes. The twins argue they would have demanded more stock in the company based on the lower valuation. Malarkey, says Kozinsky: "They brought half-a-dozen lawyers to the mediation." Facebook said it was pleased by the ruling. Lawyers for the Winklevoss twins said they are reviewing the decision and have not decided on their next step. The twins could ask the Supreme Court to consider the case. (More Facebook stories.)