The Facebook, Inc. v. Connectu, Inc et al

Filing 693

RESPONSE to re 687 Order Setting Hearing on Motion, 690 Motion Hearing, Concerning Court's Request for Additional Information on ConnectU Debt, by Cameron Winklevoss, Tyler Winklevoss. (Parke, Evan) (Filed on 8/21/2009)

Case5:07-cv-01389-JW Document693

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1 Steven C. Holtzman (State Bar No. 144177) [e-mail] 2 BOIES SCHILLER & FLEXNER LLP 1999 Harrison Street, Suite 900 3 Oakland, California 94612 Telephone: [phone] Facsimile: [phone] 5 D. Michael Underhill (pro hac vice) [e-mail] 6 5301 Wisconsin Avenue, N.W. Washington, D.C. 20015 7 Telephone: [phone] Facsimile: [phone] 8 Scott R. Mosko (State Bar No. 106070) 9 [e-mail] FINNEGAN, HENDERSON, FARABOW, GARRETT & DUNNER, L.L.P. 10 Stanford Research Park 11 3300 Hillview Avenue Palo Alto, California 94304 12 Telephone: [phone] Facsimile: [phone] 13 Attorneys for CAMERON WINKLEVOSS, 14 TYLER WINKLEVOSS, and DIVYA NARENDRA (the "Founders") 15 16 17 18 19 20 THE FACEBOOK, INC. and MARK ZUCKERBERG, 21 Plaintiffs, 22 v. 23 CONNECTU, INC. (formerly known as 24 CONNECTU, LLC), PACIFIC NORTHWEST SOFTWARE, INC., WINSTON WILLIAMS, 25 and WAYNE CHANG, 26 27 28
FOUNDERS' RESPONSE TO COURT'S REQUEST 5:07-CV-01389-JW

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN JOSE DIVISION Case No. 5:07-CV-01389-JW FOUNDERS' RESPONSE TO COURT'S REQUEST AT AUGUST 17, 2009 HEARING CONCERNING CONNECTU DEBT

Defendants.

Case5:07-cv-01389-JW Document693

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Pursuant to the Court's direction at the hearing on August 17, 2009, the Founders submit

2 additional information concerning debt that the Founders and Howard Winklevoss are owed by 3 ConnectU, Inc. ("ConnectU"). 4 ConnectU executed promissory notes from time to time between March 24, 2005, and August

5 4, 2008, to cover amounts advanced by Tyler, Cameron and Howard Winklevoss to pay expenses 6 incurred by ConnectU. The notes bore interest at the prime rate as of the payment date. The total 7 amounts due with interest through December 15, 2008 are as follows: 8 9 10 11 12 None of the three law firms whose disqualification is at issue had any role in the creation or Tyler Winklevoss Cameron Winklevoss Howard Winklevoss Total $ 858,962 $ 858,962 $6,522,448 $8,240,372

13 execution of the notes, nor have they ever represented in the past, or will represent in the future, the 14 Founders or Howard Winklevoss with respect to any efforts to collect or enforce the notes. 15 In any event, the Notes do not create adversity between new ConnectU and the Founders. The

16 Term Sheet that is the subject of this litigation provided for broad releases and for each side to pay its 17 own legal fees such that, if the Term Sheet is ultimately upheld on appeal and enforced by the Ninth 18 Circuit, it would eliminate the debts created by the Notes and preclude any collection efforts against 19 new ConnectU by the Founders and Howard Winklevoss. The Notes could only be collected from 20 ConnectU if the Founders are successful on appeal, the Term Sheet is set aside, and ConnectU is
1 21 returned to the Founders. For these and the other reasons argued to the Court, the Founders and

22 counsel do not believe that the debt is relevant to disqualification. 23 24 25 26 27 ConnectU's attempts to get mileage out of the Founders' counsel's demands that Facebook preserve ConnectU's legal claim against Facebook are misplaced. Preservation of ConnectU's assets will 28 enhance the noteholders' ability to collect the debt if the Founders' appeal is successful. If the appeal is unsuccessful, Facebook will be free to do whatever it wants with ConnectU. 1
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Case5:07-cv-01389-JW Document693

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1 Dated: August 21, 2009 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

BOIES SCHILLER & FLEXNER LLP

By: ________/s/ _____________________________ __ Steven C. Holtzman Steven C. Holtzman FINNEGAN, HENDERSON, FARABOW, GARRETT & DUNNER, L.L.P.

By: __________/s/ _____R. ____________________ __ Scott __ Mosko Scott R. Mosko Attorneys for CAMERON WINKLEVOSS, TYLER WINKLEVOSS, and DIVYA NARENDRA

CERTIFICATE OF SERVICE I hereby certify that this document(s) filed through the ECF system will be sent electronically to the registered participants as identified on the Notice of Electronic Filing (NEF) and paper copies will be sent to those indicated as non-registered participants on August 21, 2009. /s/ Evan A. Parke Evan A. Parke

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FOUNDERS' RESPONSE TO COURT'S REQUEST 5:07-CV-01389-JW