I noticed the other day that the ConnectU v. Facebook lawsuit is going still going forward. While on one hand I've spent considerable time in this space criticizing Mark Zuckerberg and Facebook's record of privacy idiocy, this lawsuit makes all that look like novice mistakes by a coder who doesn't know much about law or politics (probably true).
For those of you not in the know, ConnectU was started by three other Harvard students, Cameron Winklevoss, Tyler Winklevoss, and Divya Narendra. They originally hired a programmer named Victor Gao to work on their site, then known as Harvard Connection. When work wasn't going well, they tried to hire Mark Zuckerberg. According to court filings, Gao met with Zuckerberg and explained the idea for the site, the not-ready-for-launch backend, and the three founders' plans for the future.
Around Silicon Valley and even Washington, Non-Disclosure Agreements and Non-Compete clauses are pretty standard when you bring anyone into a start-up project. Seeing as Messrs. Winklevoss are the sons of Howard Winklevoss, who taught at the Wharton School of Business for 12 years, they should have known better than to tell someone about their idea and ask him to be involved without some kind of documentation. Instead, what they got is a furtive conversation in a dining hall. As recounted by Cameron Winklevoss in a sworn statement in this court filing:
6. On November 25, 2003, Tyler and I met with Zuckerberg in Harvard's Kirkland dining hall during an off-peak hour. The dining hall was almost entirely empty, and we sat in a private corner out of audible range. During that meeting, we discussed the harvardconnection.com website andour plans for it - further elaborating on what we had asked Victor to discuss with Mark - including our plan to make the site an advertising platform and a revenue generator and to expand the site to colleges and universities beyond Harvard.
It is noteworthy that neither of the Winklevoss brothers or Mr. Narendra had any computer experience. Cameron admits this, and says that they pretty much asked Zuckerberg to code the entire site, and they would take care of "promoting" it. Keep in mind that at this point, not a word of this is in writing. Let's summarize: Three people had an idea, asked someone to do all the work in implementing the idea, and then left him alone with a timeline, and no documentation of any agreement, ownership stake, contract, or any way to prove he would be compensated for his time. Cameron Winklevoss even admits this in the same declaration:
So, Zuckerberg, according to Winklevoss, would build the entire website, manage the website, suggest features (which he would have to implement), help the site go live, and then maintain and keep the site operational. In return, the other three would get to be the public face of the project, receive the media attention, and control pretty much everything except the down-and-dirty coding.8. We asked Zuckerberg, as one of the four Harvard Connection team members, to (1) complete all coding and technical aspects of the Harvard Connection website for an immediate December 2003 launch; (2) participate in the management and control of the project; (3) suggest features for the web site; (4) help launch the site; (5) handle the technical requirements of the site; and (6) operate the site withus. Zuckerberg enthusiasticallyagreed to do these things. We agreed that Tyler, Divya and myself would handle all promotion, marketing, advertising sales, press and media relations, and business strategy for the site. Zuckerberg said that he would handle the technical side of the project, and that he expected to be able to make good progress towards completion of the site over the Thanksgiving break.
Somehow I doubt anyone would want to do pretty much all the work required for building a web site from scratch, and then let the three other people involved, who had done no work other than think of the concept take all the public credit and attention. Now, Mr. Zuckerberg may be tone-deaf politically, but I don't think he (nor I, nor anyone I know) would "enthusiastically agree" to be essentially a silent partner who got to do most of the work on something.
Also, keep in mind that Cameron and Tyler Winklevoss were members of Harvard's Varsity Rowing team. Having spent 10 years in the sport, (including a few at Wisconsin, which competes against Harvard) I know how much time these guys were putting into their oars. Rowing is a life-consuming pursuit. Even today, Messrs. Winklevoss are training for spots on the U.S. Olympic team, while using their father's money to finance their lawsuit. They train nearly full time in Princeton, New Jersey, where the U.S. team has its training center. Mr. Narendra is a hedge fund manager in New York.
Do you think these guys had the wherewithal or time to get a project like Facebook off the ground or grow it the way that Zuckerberg has? I mean, he dropped out of Harvard to run the site full-time once it got big enough. The other three finished school and got their degrees. One is a New York high-roller and the other two live off their father's wealth (Howard Winklevoss has enough money that he even started an importer of Chinese made low-cost rowing shells and bought a boathouse, Saugatuck Rowing Club) and spend their days working out.
Back to Cameron Winklevoss' sworn declaration. He says that Zuckerberg never told him, his brother or Mr. Narendra that he had stopped working for them and started his own version of the project, or complained that he was essentially a silent partner, despite Cameron's offer to somehow "raise his public profile" with an article in the Harvard Crimson, the campus paper:
...During this meeting, I also suggested and offered tomake him the focal point of an article in the Harvard Crimsonabout the website's launch, in an effort to improve his public image after the Facemash debacle in early November, for which he had received much negative coverage in the Harvard Crimson, and was called in front of the Harvard Administrative Board amid student outcry. I stressed how this could be very positivefor his reputation, and make him a hero on campus. Zuckerberg suggested contacting his friends who worked at the Harvard Crimsonto help obtain coverage for the site. He never indicated that he would no longer participate in the managementand control of the project, or stop coding the website. Because exam period was beginning, we agreed to touch base in early February to continue work on the website.15.Zuckerberg never told the Founders that he stopped working on the HarvardConnection website before he launched thefacebook.com website.
He never told these clowns anything because legally, he didn't have to. He was not under contract, had no agreements signed, no NDA, no Non-Compete, no anything. Zuckerberg was already known around campus as a programming whiz, since he had previously created a "Hot or Not" type site using the Harvard directory, which caused a bit of controversy on campus.
So, what happened was a few kids with an idea told a smart programmer about it, and then left him alone to do all the work, never paid him, and gave him no assistance except the offer of "equity" in something that didn't yet exist. There was nothing for them to give up front except wither a) cash money or b) and wink and a smile. No money, or shares changed hands at any time because there was no money and there were no shares. That's right. Harvard Connection, or ConnectU did not even exist on paper at the time. The "founders" were too busy rowing or doing whatever future hedge fund kiddies do to actually go through the proper steps to start a business, hire employees, etc. In fact, the company didn't even exist until the plaintiff's father, Howard Winklevoss, started ConnectU and hired programmers with his money. Here's an excerpt from his sworn declaration:
2. In early 2004, after Mark Zuckerberg stole the founders' ideas and code and started thefacebook.com, I helped to finance and start the company which is today known as ConnectU, Inc. ("ConnectU"). ConnectU hired a company called iMarc to write code for the site connectu.com...
While this was going on, Zuckerberg improved upon the concept, started an actual company behind it, wrote the code and expanded it himself. He dropped out of school. He moved to California. He did stuff.
On the other hand, the Winklevoss twins went on to win a few rowing races, and their "partner" now plays with other people's money in New York. Their lawsuit is based on a few conversations in a cafeteria and some dorm room chatter.
Note to people with ideas: if you want things done, do one of two things: get out of the boat and do it yourself, or find someone you can and get the specifics on paper. Considering their father, Howard Winklevoss, has started a few businesses and is a graduate of Penn's Wharton School of Business, even a call home to dad would have gotten them the advice needed to make sure their idea got off the ground, or at least stayed their idea. Instead, they were too busy working out to do anything except order someone around who happened to be much more dedicated to their concept than they were...at least until it got big.
Now they are suing. So far, the case has not made it past pretrial motions, and as it stands the deadline for the Winklevoss brothers and their friend to respond to Facebook's motion for Summary Judgement is March 10th. After that, the judge may throw the suit out entirely and find for Facebook, since there seems to be no real evidence that a) ConnectU existed before Facebook launched, b) anyone hired Zuckerberg to do anything, or c) this is anything but a case of sour grapes.
I'll also note that while the other three guys promised to "handle all promotion, marketing, advertising sales, press and media relations, and business strategy for the site," I cannot imagine how two people rowing for Harvard coach Harry Parker, who himself is a legend in the sport, as well as being full time students, could find time to put the effort that Zuckerberg has put into the site. I'll repeat it: Zuckerberg dropped out of school to work on Facebook full time. The other two didn't. Running a successful business takes hard work. Does anyone think that it would have been successful had it not been for Mr. Zuckerberg's persistence and time commitment? I'm going to go out on a limb and say that had he not gone "whole hog" (to rip off a phrase from Sen. Claire McCaskill (D-MO)), we'd still be thinking of Facebook as those paper directories we get in college. Despite his many missteps since then (and there have been and will be many), it is Mr. Zuckerberg and his team who deserve credit for such a successful project, not a few spoiled rich kids who spent more time in a behind an oar than a screen or a desk working on the business.
Maybe the Winklevosses need to stay in the boat and out of the courtroom. They competed for the U.S. in last year's Pan American games, winning a gold medal. They seem to have much more success in that arena, and probably should keep it that way until they can do things right.
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