ConnectU is a company that never ceases to haunt Facebook co-founder Mark Zuckerberg. According to an article published in The Recorder, the Winklevoss brothers (who founded ConnectU), were awared $65 million in their suit against Facebook. You may also remember that there was a follow-on suit as the brothers were provided with stock options based on Microsoft’s $15 billion valuation despite private Facebook stock trades that valued the company at around $4 billion.
If the brothers were paid completely in stock and if the follow-on suit was settled at a reasonable valuation for Facebook, the brothers could have obtained up to 1.6 percent of Facebook. That would be the best case scenario for the brothers. This isn’t what happened though according to the Recorder, the settlement “was paind in a mix of cash and Facebook shares.”
The brothers are also now in a legal battle over the fees paid to Quinn Emanuel, the firm who won the settlement. The firm’s current tag line is “It’s Our Opponents Who Needed a Bailout.” This was published in the company’s brochure which included a statement about the $65 million settlement against Facebook. The other tag line published on the company’s website is, “When an 8-Figure Setttlement Simply Won’t Do”.
If you are looking for a big payout, it looks like the Quinn Emanuel trial lawyers are the guys to go to. It’s a great advertisement for the company, yet it probably won’t help their dispute with the Winklevoss brothers over the total fee owed to the company. While the brothers don’t own 1.6 percent of Facebook, they should be pretty satisfied with the result of the suit.
A commenter noted that $65 million is 1.6 percent of Facebook at a $4 billion valuation, not 16 percent. They would be accurate and I’ve updated the article to reflect that.