Facebook paid rival $65 million in suit

A slip-up by a law firm Tuesday revealed that Facebook Inc. paid $65 million to end its legal fight with a smaller social network, ConnectU.

The founders of ConnectU had accused Facebook Chief Executive Mark Zuckerberg, a fellow Harvard University graduate, of stealing their ideas to create his site. The details of last year’s settlement were supposed to be confidential.

But Quinn Emanuel Urquhart Oliver & Hedges, which represented ConnectU, recently issued a newsletter boasting about its legal victories. Among them: It netted Tyler and Cameron Winklevoss, the twins who started ConnectU, $65 million in cash and stock options.

The Recorder, a legal publication, broke the news. It also published the firm’s marketing brochure, which lists recent court victories above the tagline: “It’s Our Opponents Who Needed a Bailout.”


Facebook was valued at $15 billion after a 2007 investment by Microsoft Corp. Its valuation has dropped since, which makes the settlement less lucrative for ConnectU.

Peter Calamari, a lawyer representing ConnectU, said the release was inadvertent.

“Our PR people released something, and it didn’t get caught by the people who knew,” he said. “We had a policy against commenting or talking publicly about this case.”

A Facebook spokesman declined to comment.