• by Mark Walsh  @markfwal, February 10, 2009

Facebook paid the founders of social networking rival ConnectU $65 million to settle litigation alleging that Facebook CEO Mark Zuckerberg stole their idea for the site, according to a report today in The Recorder legal publication.

The previously undisclosed amount of the confidential settlement was published by ConnectU's former law firm--Quinn Emanuel Urquhart Oliver & Hedges--in a January business litigation newsletter. The disclosure was apparently inadvertent, as firm chairman John Quinn asked The Recorder not to print the settlement amount because of the confidentiality provision.

ConnectU fired Quinn Emanuel last year, and the two are now locked in a fee battle. Neither Facebook or its lawyer at Orrick, Herrington & Sutcliffe would comment on the settlement, according to the report.

The $65 million settlement would represent only a tiny proportion of Facebook's valuation, estimated at $4 billion by Silicon Alley Insider. But eMarketer estimated the fast-growing social network had only $265 million in 2008 revenue.