Facebook Loses Bid to Immediately End Winklevoss Twins’ Lawsuit in Boston

A U.S. appeals court put on hold all litigation between Facebook Inc. and twins Cameron and Tyler Winklevoss, who claim Mark Zuckerberg stole their idea for the social networking site.

The U.S. Court of Appeals in San Francisco yesterday agreed to halt litigation related to the Winklevosses’ lawsuit until they file a request with the U.S. Supreme Court seeking to reverse the dismissal of their claims.

The Winklevoss twins, former Harvard University classmates of Zuckerberg’s, want a 2008 settlement they reached with Facebook to be voided because they claim it was procured through fraud. They allege that Palo Alto, California-based Facebook didn’t disclose an accurate valuation of its shares before they agreed to the $65 million cash and stock settlement.

Facebook and the Winklevosses fought the dispute in federal courts in San Francisco and Boston. The court in Massachusetts agreed to put its case on hold until the California court ruled on it.

Facebook, in documents filed with the appeals court, said the twins’ allegations before the Massachusetts court that the company and Zuckerberg, its chief executive officer, failed to produce legally required documents should be resolved because an appeal to the Supreme Court has no merit.

The Supreme Court petition “should not stand in the way of resolving the last meritless motion that will end this case once and for all,” Facebook said in a filing.

The appeals court said in a decision in April that the agreement between the Winklevosses and Facebook barred future lawsuits and was “quite favorable” to the twins.

The case is The Facebook Inc. v. ConnectU Inc., 08-16745, U.S. Court of Appeals for the Ninth Circuit (San Francisco).

To contact the reporter on this story: Joe Schneider in Sydney at jschneider5@bloomberg.net

To contact the editor responsible for this story: Douglas Wong at dwong19@bloomberg.net

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