Why Winklevoss’ Latest Appeal Petition Will Go Nowhere

The Winklevosses are asking for yet another appeal of their recent loss to Facebook–a request for an “en banc” rehearing, filed on Monday. But barring a miracle, their case is going nowhere.
If you lose a case in the U.S. federal court system, you have the right to appeal, guaranteed. With a few exceptions, including patent cases, appealed federal lawsuits go to one of the 13 numbered circuit courts that divide the nation geographically. The Winklevoss’ appeal is situated in the 9th Circuit, the San Francisco-based appeals court which covers most of the western U.S.
But if you lose again on appeal–as the Winklevosses have with their argument that they got swindled when they settled with Facebook back in 2008–the options get very limited. There are two remaining options, both of which rarely succeed.
En banc appeal petition. Appeals courts typically hear cases in three-judge panels, but that’s only a fraction of the full court. The 9th Circuit is the largest in the nation, which currently has 26 active judges. A litigant can ask that their case be re-heard by a larger en banc panel; in the 9th circuit, en banc panels have 11 judges. The court doesn’t have to approve this request, and rarely does. They’re most likely to do so if they think the issue is very important or if a particular three-judge panel really went off the rails and did something crazy. It’s hard to imagine the Winklevoss case against Facebook meeting either criteria.
In fiscal 2010, only about 2% of those asking for an en banc re-hearing from the 9th Circuit were successful. According to statistics given to me by a spokesman for the court, 1,002 parties asked for a re-hearing en banc. Of those, only 58 were forwarded for a vote (meaning at least one judge out of the 26 active judges wanted a re-hearing.) The petitioner needs a majority of active, non-recused judges to favor a re-hearing in order to get one. That only happened in 24 cases last year. Assuming that no judges recused themselves, 14 judges would have to vote to re-hear the Winklevoss appeal against Facebook.
The last stop is an appeal to the U.S. Supreme Court. The Supreme Court issues full written opinions for less than 100 cases annually, out of several thousand petitions asking for a hearing, giving an average grant rate of around 1 percent. The court disposes of another 50 or 60 cases each year without a full hearing. In all of those cases, the court is looking to decide issues of overriding national importance, as well as issues where the “numbered” appeals have differing rulings. Again, the Winklevosses aren’t going to qualify.
Endless appeals might be annoying, but they’re not irrational in an economic sense. If the Winklevosses were to succeed in their argument and get a do-over on their settlement with Facebook, they’d be set to win additional tens of millions of dollars, if not hundreds. Even longshot appeals are relatively cheap, and in a case like this, the potential reward is huge. So don’t count on the twins getting another hearing from judges–but don’t count out the possibility of them asking for one.