Last Lesson: Settle or Go to Trial?

Business litigation is often like the game of poker. For example, when deciding whether to settle or go to trial, a plaintiff must decide whether to invest more money in his or her case in order to secure a possible payout or risk losing the case altogether. At the same time, many successful companies with “deep pockets” are often tempting legal targets for plaintiffs’ lawyers. Facebook is no exception. Soon after its founding in 2004, Facebook faced multiple lawsuits in State and federal courts, including a federal lawsuit brought by ConnectU (the Winklevoss twins’ competing social network site) as well as several State-law claims brought by one of Facebook’s co-founders, Eduardo Saverin. But as we have seen in several previous lessons, a strong case can be made that Mark Zuckerberg really did create “thefacebook” without stealing anyone’s intellectual property, while Eduardo arguably breached his fiduciary duty to Facebook when he froze the company’s bank account in July of 2004. So, why do you think Facebook eventually decided to settle its legal claims with ConnectU and Eduardo, instead of going to trial?

In the meantime, consider this hypothetical conversation between Mark and “Marylin”–a fictional associate at Facebook’s law firm who specializes in voir dire, or jury selection–an exchange which appears in Aaron Sorkin’s screenplay for “The Social Network,” the movie version of Accidental Billionaires:

MARYLIN

I’ve been licensed to practice law for all of 20 months and I could get a jury to believe you planted the story about Eduardo and the chicken. Watch what else. Why weren’t you at Sean’s sorority party that night?

MARK

You think I’m the one who called the police?

MARYLIN

Doesn’t matter. I asked the question and now everybody’s thinking about it. You’ve lost your jury in the first 10 minutes.

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