Despite a US$65 million (now worth US$140 million) legal settlement and a movie generating plenty of Oscar buzz, there appears to be plenty left to write about the Facebook imbroglio between the world’s youngest billionaire, Mark Zuckerberg, and the wealthy scions who claim Zuckerberg stole their idea.

The New York Times reported earlier this month that “Tyler and Cameron Winklevoss, the cinematic identical twins who claim to have come up with the original idea … will pursue their case on Jan. 11 before the United States Court of Appeals for the Ninth Circuit in San Francisco.”

The twins allege that at the time of the settlement (which was reached in the early hours of February 23, 2008), they were not told of an expert valuation which valued Facebook shares at $8.88 each, rather than $35 each (which was what Microsoft has paid and what the settlement was based on). This meant that the Twins would have received four times as many Facebook shares as they did.

The argument beggars belief. Facebook quite logically alleges that the valuation was public, it was merely one of many valuations, and that the twins agreed with the valuation (and in any event, the value of the shares is now US$120 million — which was far more than the original settlement anyway) .

While Zuckerberg has never formerly given his account of what transpired, the book, Accidental Billionaires (upon which the Social Network movie was based) and various sources claim Zuckerberg was hired by the Winklevoss twins and their friend, Divya Narendra, to work on a website later called ConnectU – the site would act as a social network for college students (Zuckerberg was the third programmer hired by the trio).

Zuckerberg spent several months apparently working on ConnectU while at the same time, allegedly building his own website which would become thefacebook.com. While Zuckerberg claims that the code for thefacebook was different to ConnectU, it appears that the sites were based on a similar premise.

Thefacebook experienced phenomenal initial growth, expanding to other colleges between February and April 2004. By late May 2004, ConnectU launched its first website for Harvard students, but by then, Facebook had already reached a critical mass at Harvard and had already expanded to other elite colleges.

In September 2004, the Winklevoss’ twins (whose father, Howard Winklevoss is the millionaire founder of Winklevoss Consultants and Winklevoss Technologies) sued Zuckerberg, alleging he stole the idea for Facebook from them.

While it would be naïve to suggest that Zuckerberg’s creation of thefacebook was merely coincidental to ConnectU and his hands do not appear completely clean, the Winklevosses are taking an almighty risk in re-opening the Facebook case and appear to have been extraordinarily lucky to receive anything, let alone US$140 million. The enormous success of Facebook is largely due to the skill and hard work of Zuckerberg.

Zuckerberg dropped out of Harvard and moved to California to build Facebook, taking enormous personal risk. The Winkelvoss twins by contrast completed their Harvard degrees and spent a very large amount of time rowing (they were in the US Olympic team in Beijing in 2008), meaning that they almost certainly would not have had the time, let alone the ability to create what Zuckerberg did with Facebook.

Moreover, the Winklevosses were hardly the first to come across the concept of ‘social networking’. Friendster and Myspace were certainly well established before the Winklevosses asked Zuckerberg to work on ConnectU.

Further, the Winklevosses and Narendra knew nothing about programming — all they provided Zuckerberg with was a basic premise. The Twins expected Zuckerberg build, manage and create features for the site in return for what appeared to be a silent stake in a company which didn’t actually exist. Many of the innovations which allowed Facebook to become internationally ubiquitous (photo sharing, live feeds) were created by Zuckerberg and subsequent Facebook employees. There appears no doubt that the Winkelvosses, who collected US$140 million (including cash and Facebook shares) have ended up far better off financially that had Zuckerberg finished ConnectU himself and never proceeded with thefacebook.

What’s more, despite their blue-chip pedigree (the Winklevosses were members of Harvard’s elite Porcellian Club and rowed for the US at the Beijing Olympics), the Twins have had (somewhat lower profile) legal issues of their own. According to Gawker, in 2005: “After graduating from Harvard, the brothers were allegedly evicted by their landlord from a $4600 per month apartment they had rented in Cambridge” after it was alleged that they “[failed] to pay rent [and caused] a series of complaints about partying and noise, and an arrest after a fight in which Cameron allegedly attacked Tyler with a hammer.”

After the eviction, the twins allegedly acquired several websites and made defamatory remarks about their former landlord. The landlord then sued and the Twins were forced to make an undisclosed legal settlement.

Meanwhile, Zuckerberg, the alleged villain, has undergone a remarkable public image transformation in recent months, spurred by his US$100 million donation to the New York Public School system, announced on the Oprah Winfrey Show in September.

Of course, if you’re wondering why the Winklevoss twins (dubbed “Cyber Crybabies”) are potentially re-opening legal wounds — it could be due to Facebook’s continues, astronomical growth. If the Twins are successful, they would receive Facebook shares worth almost US$500 million. (The irony is not lost — the Winklevosses are claiming that the valuation of Facebook was inflated, but are only re-opening the case because the value of Facebook has increased, which means that it probably wasn’t inflated in the first place).

While not yet publicly listed, based on its most recent funding round, Facebook has been valued at US$50 billion. And the growth isn’t over yet — Facebook is still worth far less than Google’s current market capitalisation of US$189 billion (this is despite Facebook last year having more website hits than Google — 8.93% of US visits compared with 7.19%). Admittedly, Google has a much more logical revenue stream than Facebook — that is because when users are searching in Google, the advertisements are targeted based on the users search requests — by contrast, Facebook ads are more general, targeting users by demographic (in the same was that TV or radio would).

By regardless of its exact current valuation, with 647 million unique visits last November alone, Facebook is truly transforming the way the internet is used. And that’s due to Zuckerberg, not a couple of spoiled rowers who aren’t happy with a US$140 million settlement.