Persistence — even if it is the whiny, likely undeserved, lunkheaded legal version of it — certainly pays off.

But you have to marvel at the bizarre karma going on, given that my favorite matching pair of digital ottomans, Cameron and Tyler Winklevoss, are poised to collect up to $300 million from the shares they got in a settlement with Facebook and its CEO and co-founder Mark Zuckerberg over the founding of the social networking giant.

That’s right, folks, the rich do get richer, especially if they pursue their case well past the point of shame.

It’s not clear how many of the 1.2 million shares the Winklevii still have from the settlement they got in 2008, since they wrangled with their own lawyers over it, and the stock has also split.

But let’s assume the Olympic rowers kept a chunk, which will be worth a lot of gold-plated oars if Facebook reaches the upward of $80 billion valuation it is expected to in its upcoming initial public offering.

Facebook filed its long-expected IPO earlier this week.

And here’s a lovely tweet about the IPO from Cameron Winklevoss, who is looking very fetching on his Twitter page, even if it is perhaps about time to lose the rower meme image thing, given he’s on the closer side of 30 years old.

We r excited 4the #FacebookIPO + wish the company + all involved the very best,an amazing accomplishment! cc @tylerwinklevoss @DivyaNarendra

— Cameron Winklevoss (@winklevoss) February 2, 2012

He sent it to his twin brother, Tyler, and also to Divya Narendra, their other partner in the ill-fated ConnectU service.

Without going into all the well-gone-over deets (go see the Aaron Sorkin-penned movie and believe about 26 percent of it), ConnectU was the Harvard University dating site that Zuckerberg allegedly submarined in order to start Facebook.

Well, presumably water under bridge — unless you are talking about the perpetually disgruntled Winklevii.

At the time they finally dropped their seven-year fraud lawsuit this past summer, they then reopened to a different one then pending.

“The Social Network 2: The Overly Compensated Vii Strike Back,” anyone?

MORE ON THE FACEBOOK IPO:

• Facebook’s Ad Business Is a $3 Billion Mystery
• Viral Video: Farewell to the No-IPO Mark Zuckerberg
• Zuckerberg Is the Billion-Share Man: Who Owns What, Who Makes What in the Facebook IPO
• Zuckerberg Tells Investors, “We Don’t Build Services to Make Money”
• Mobile Highlighted as Key Risk Factor (and Opportunity) in Facebook Filing
• Stop All That Poking: Facebook Filing Temporarily Crashes SEC Web Site
• Zynga Accounted for 12 Percent of Facebook’s Revenue in 2011
• Facebook Has 845 Million Users
• On Its Eighth Birthday, Facebook Files to Raise $5 Billion in Massive IPO (Get Your S-1 Here!)
• Go the F**k Back to Sleep, Silicon Valley: Facebook IPO Likely to File Later Today at Earliest
• Dude, Where’s My Facebook IPO Filing? (Ashton’s on Hold!)
• The Quiet Man: Meet the Less-Known Face of the Facebook IPO, CFO David Ebersman
• Facebook Board Meeting Today for Final IPO Okays
• Facebook (Eye)PO: Tracking the Truth of the Biggest Deal of Web 2.0
• Viral Graphic: Visualizing the Facebook IPO
• Is Facebook IPO on Track for Late May?
• IPO Watch: Facebook Hiring Brunswick to Help With Comms for Expected Public Offering
• Complete Facebook coverage

TiVo shares initially leaped 15 percent to $10.27 after hours Tuesday, while AT&T rose 6 cents to $30.44.

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In answer to a direct question about whether his company was going to buy Yahoo at a forum at Stanford University in Silicon Valley this afternoon, Alibaba Group Chairman and CEO Jack Ma said: “We are very interested.”

Said Ma: “We are very interested in Yahoo. Our Alibaba group is important to Yahoo and Yahoo is important to us … All the serious buyers interested in Yahoo have talked to us.”

Finally, at least one crystal clear answer in the confusion at Yahoo. More importantly, it is the first time Ma has indicated that he wanted to be a principal player in any deal around Yahoo rather than an element of a buying group.

Later, in answer to a question I posed about how he was going to do that, Ma said he wanted the “whole” company, but that the effort was complicated and included a number of players.

Again, he said: “We are very, very interested.”

I also asked him if he had visited Yahoo in his trip to California, which Ma said he has not in 15 days here so far. He said he has mostly been sleeping and eating, as part of a longer-term visit to the U.S.

Ma’s declaration came as part of a lively closing keynote speech at Stanford University’s Graduate School of Business, where he talked about the Chinese Internet company’s growth, focusing on how China is the next great Web economy.

Talking about competitors such as eBay, which have tried to enter the huge Asian market, he joked that “eBay might be sharks in the ocean, but Alibaba is a crocodile in the Yangtze.”

Of course, given his presence in Silicon Valley, one topic of interest was whether Ma would be heading over to visit nearby Yahoo and what role he will play in the current internal debate over the company’s future in the wake of the ousting of its CEO Carol Bartz.

The disposition on Yahoo’s Asian assets, which includes 40 percent of Alibaba and a large stake in Yahoo! Japan, are critical to the current strategic review of the company, since they make up a large part of its market valuation.

In comparison, the value of its U.S. and other global assets are small.

When later asked about his experience of being involved with Yahoo, which made a very canny investment by Yahoo co-founder Jerry Yang in Alibaba many years ago, Ma also said that he would do it again, but not in the same way.

The same way has to do with the level of foreign ownership, which Ma has been trying to reduce in a number of ways and which Yahoo has thus far resisted.

To answer a question about the fight between Ma and Yahoo over its Alipay fight, when Ma spun it out of Alibaba, he said the situation was tense, but that today “the problem is solved and I am half-burnt.”

He was referring to a settlement, which will require a lot of growth from the still-nascent online payment business.

Ma was asked later about the biggest misunderstanding in the U.S. about China and vice versa. “Our job is not to solve the misunderstanding,” he said. “Our job is to change ourselves to solve the problem.”

In another query about his relationship with Yahoo’s Yang, Ma called him a lifelong friend and also said he appreciated how much that meant to Alibaba’s beginnings.

“But, this is business and not personal,” Ma said about the current situation. “While we appreciate yesterday, but we are looking for a better tomorrow.”

The first line, for those not mad fans of the classic movie like me, is from “The Godfather.”

The question is, though, will Ma make Yang an offer he can’t refuse?

The Justice Department said that the forfeiture was one of the largest ever in the U.S. and represented the gross revenue received by Google as a result of Canadian pharmacies advertising on Google, plus gross revenue made by Canadian pharmacies from their sales to U.S. consumers.

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As these companies are wont to do in the middle of the night, Yahoo, SoftBank and the Alibaba Group have reached an agreement in their nasty dispute around the Alipay payments unit, and they are ready to talk about it.

Well, not Alibaba’s CEO Jack Ma (pictured here), Yahoo’s CEO Carol Bartz or SoftBank’s Masa Son, but their functionaries are all set to discuss the deal.

The issue has revolved around the spinning out of Alipay by the Chinese Internet giant Alibaba, without the approval of large stakeholders Yahoo and Japan’s SoftBank, which the pair felt was a big no-no.

Much mishegas followed, but the trio has been hard at work on a settlement, which is here now.

Of course, had the three companies cooperated in the first place as joint owners and board members of Alibaba, this all would have been unnecessary.

5:48 am PT: The call starts without all kinds of regulatory info about what can and cannot be said, before being thrown to Yahoo CFO Tim Morse.

One interesting wrinkle is that SoftBank’s Ron Fisher cannot speak at all, due to some Japanese laws, which are unexplained. But, said Morse, he’s there to show his support.

Go, Ron!

Alibaba’s CFO Joe Tsai is up first to talk about the deal over Alipay, which he stresses does not really make much money now. As he says, it is “marginally profitable.”

Tsai walks through the facts that they have already outlined earlier today, including a variety of payments from Alipay to Alibaba, since — let’s be clear — it used to be part of Alibaba.

But Alibaba said it had to spin it out in order to get critical regulatory approvals from the Chinese government, which caused this mess.

Morse now comes on, noting the whole squabble really had “no direct impact” from a financial point of view on Yahoo or SoftBank at this time related to its Alibaba assets.

Well, shareholders of Yahoo might beg to differ, considering the huge hit the stock has taken due to the fight. Wall Street has long considered Yahoo’s Asian assets its most valuable part.

But Morse is pleased the complex agreement has finally been reached — I am guessing it was not easy to negotiate among three different countries with so much pressure.

5:59 am: Time for Q&A!

The first question is about more deets and also about the possibility of a liquidity event for Alibaba or its various units.

Tsai underscores that there might not be one or there might be one. In other words, the Chinese assets of Yahoo may or may not ever pay off.

The next question is about why Yahoo and SoftBank should have a cap on an asset they used to own 100 percent of. Good point!

Neither Morse or Tsai really answers the question, except for Tsai talking about how certain rules over foreign ownership of payment companies in China means it had to be like this.

“If you own 100 percent of the business that cannot operate, you own 100 percent of zero,” said Tsai.

Translation: That’s China, folks, so suck it up!

The next question is a promissory note, which Tsai says has value, even though it actually does not have value right now. China!

The analysts still are stuck on this fact that, under terms of the agreement, Yahoo will only get 37.5 percent of an IPO or other liquidity event, when it used to be owner of 100 percent of Alipay.

Good point: Will this happen to other Alibaba units, such as its Taobao commerce unit?

China is a good place to be, assures Tsai, which is cold comfort right now.

A lot of swirl around preferential terms in the deal for Alipay with Alibaba’s units, which seem to be the same as before. In other words, nothing has changed, except a lot of stock loss for Yahoo and less technical ownership of Alipay.

The Wall Street analysts on the line continue to be riveted to the idea of a liquidity event for Alipay and other Alibaba units, especially Taobao, and keep asking different versions of this question.

The last question is about more deets of the deal and new business ideas for Alibaba.

Tsai talks about a cloud-based system rolling out, for example.

The questioner moves to, you guessed it, a liquidity event.

“I don’t think we want to get into it at this point,” says Tsai.

Well, we do, but apparently Yahoo shareholders are not going to.

That said, the deal is finally settled, which has already given Yahoo shares a small bump today. And that’s not nothing.

Yahoo turned in another weak performance in the second quarter, with yet another decline in revenue.

This time it was five percent, compared to last quarter’s six percent. In other words, at least things are looking up as they go down!

While earnings per share rose smartly, Wall Street is still looking for strong sales growth from the Silicon Valley Internet giant, which seems unable to provide it.

Blamed most this time for the revenue fall: Yahoo’s changes in its display sales operations in the key Americas region, reasons for which were largely unspecified in the initial company press release. (You can see the damage in this slide deck from the company here.)

Maybe Yahoo CEO Carol Bartz will explain it all in its upcoming conference call with analysts (or she could try the I-don’t-know approach taken by News Corp. CEO Rupert Murdoch in PhoneGate hearings in Britain earlier today!).

2 pm PT: It starts with the usual regulatory blah-blah, which I always enjoy.

Bartz gets right into it, opening with the key problems with China’s Alibaba Group, as well as its display and search revenue weaknesses.

The fight with Alibaba is over its Alipay payments unit, which was spun out of the Chinese company without Yahoo’s say-so. Yahoo is a big shareholder.

Bartz says that the company was working on a settlement night and day.

But she quickly gets onto how display did not perform as expected in its key Americas arena. “Obviously, I am not happy,” she said.

Obvi! Neither are shareholders, Carol.

She says it was not about new competitive development. It was not about the economy. It was not about engagement.

So what was it? Changes in its sales leadership and organization, says Bartz, which has included talent walking out the door in droves.

A lot more than Yahoo expected, but no surprise to anyone who has been paying any attention to the brain drain at the company.

Bartz promises a new approach to sales, part of its endless turnaround, which is beginning to feel like a digital version of “Waiting for Godot.”

Search revenue, though, says Bartz, was better than expected.

2:11 pm: CFO Tim Morse is on now, running through the numbers and the display shortfall in the Americas region.

“We simply did not have appropriate coverage,” says Morse, noting consumer products, tech and autos as weak spots in the advertising market.

Thank goodness, then, for the guarantees from search revenue in the Microsoft partnership deal.

More numbers and then it is back to Bartz to talk about search, which is going better than the last quarter, when it was the culprit for the revenue decline.

She says that Microsoft and Yahoo were working together to improve the issues.

“We’d like to be further down the road,” says Bartz about the goal of search revenue per search growth, as well as settling all the other problems, such as the Asian issues.

And, by further, I am presuming she means actual forward movement, which is what roads are actually for.

2:27 pm: Q&A time, the part of our program where Wall Street analysts do not ask the questions that need asking (and where I win fancy journalism awards for pointing this delta out!).

Therefore, Bartz is first thanked for providing “color” about the display disaster and is not asked about more specifics of the disaster itself.

The second question still does not get to it either, but she does note Yahoo’s sales force has to sell beyond “Gee, we’re big” and come up with better ad solutions.

“The issue is we did not have enough sales people in front of the big clients,” says Bartz.

That’s because all those former Yahoos are now working at Groupon, LivingSocial, Facebook and on down the line and now in front of big clients for those hotter companies.

2:34 pm: Question about its Asian assets. Yahoo’s talks with Yahoo! Japan and Alibaba are separate, says Bartz, although I would add that they have non-movement in common.

And also a question about Yahoo’s interest in the acquisition of the Hulu premium online video service.

Bartz winks verbally and says nothing, which translates into: Of course, it is interested.

More on the reasons for the display fall-off, which Bartz makes clear is not due to big competitive threats, but internal issues.

Maybe she’s saving big competitive threats as the reason for a revenue decline in the third quarter!

I look forward to the quarter I get the finger pointed at me for causing revenue to fall, due to my snarky posts.

Now, we are into softball questions about improvements in engagement. It’s up, but no one asks why Yahoo is still not doing anything very cutting edge in product innovation compared to competitors.

I believe Google has launched at least 14 new social networks since this Sunday, along with its strong quarterly performance last week. And Apple, well, blew away its quarter today as it is about to release more cool new stuff later this week.

And that might be the crux of the issue for Yahoo, which might not solve its woes by throwing a more focused sales army at the issue.

That’s because Yahoo’s products are simply not nearly has social as Facebook or even Google right now, which might be the true problem as old customers move on to new advertising solutions.

Whatever the reason, Yahoo clearly needs a refresh of its ad products and how it sells them, especially in its fast-growing mobile, video and communications products.

Bartz talks about getting better expertise, a tighter regional focus and other issues of going to market, which is perhaps something she might have realized many, many quarters ago.

After all, she’s been in charge for a while, and these issues are not new.

In fact, in an earlier quarter, Bartz was stressing “tentpole” events and anchor media properties and the power of the size of Yahoo as a selling point.

This was in April, in fact, in the first quarter of this year.

As I wrote then:

“CEO Carol Bartz excited was the Silicon Valley Internet giant’s traffic gusher for big tentpole events such as the Super Bowl and the Oscars. In fact, Bartz practically sounded like a gushy “Entertainment Tonight” flunky when talking to Wall Street analysts about Yahoo’s Oscar news, games and other offerings. She proudly noted the site’s efforts generated more than a billion pages views.”

Now big is out! Moving on!

The last question is another about Yahoo’s talks with its Asian partners.

“It’s complex,” says Bartz.

You can say that again.

The execs at Yahoo were huddled yesterday and also today, getting ready for its investor day tomorrow morning.

It’s probably a good idea, especially since the Silicon Valley Internet giant has to come up with a good answer to how it is settling the recent kerfuffle with Chinese partner Alibaba Group.

A settlement announcement over the spinoff of Alibaba’s Alipay payments unit would be the best thing Yahoo could deliver by tomorrow, of course.

All parties–Alibaba, Yahoo and Japan’s SoftBank–I spoke to said a resolution was still being worked on, but one assumes reaching one sooner than later would be a big coup for Yahoo.

Barring that, China will surely be Question No. 1–and likely Nos. 2 through 23–from about 200 Wall Street analysts and big shareholders gathered from 8 am to 2 pm at the Fairmont Hotel in San Jose to hear about how Yahoo is doing in 2011.

Given that the China problem has kept Yahoo stock stuck in the $16 doldrums for weeks now, after it had seen some progress before that, Yahoo CEO Carol Bartz and the passel of top execs presenting–Ross Levinsohn, Blake Irving and Tim Morse, among others–will have to scratch that itchy itch first before moving on to other questions.

In the interests of making the day interesting–and because press is not invited–I am here to help those investors without a clue of what to ask.

Thus, my list, in no particular order:

* Now that a newish management structure is in place, what is the big vision for Yahoo going forward?

* Please explain in detail the issues raised in the recent earnings call with the search and online advertising partnership with Microsoft, and should the deal be re-negotiated?

* Do you need to make more cuts in staff–which seems to have creeped back up in size?

* Why is Yahoo still in search in such a significant and expensive way, especially since market share is declining?

* How is the display market faring and how does Yahoo plan to innovate its flagship advertising business?

* Engagement is a key metric these days, so how is Yahoo going to improve its customer relationships, besides saying it will?

* What new and innovative products are in the pipeline–and you may not trot out Livestand for the umpteenth time as an example, unless you want me to start calling it Not-Flipboard–and when will they launch?

* Has Yahoo considered other ownership options that would better reward long-suffering shareholders?

* And, oh yes, China. Let’s not forget about China.

(Although media is not invited to the investor confab, I will be covering it via a live stream Yahoo is offering–you didn’t think I would miss it?)

The Internet company disclosed in a cryptic regulatory filing earlier this week that it was setting aside $500 million to potentially resolve a case with the Justice Department. A payment of that size would rank high among the criminal or civil penalties paid by companies in disputes with the U.S. government.

Google gave virtually no details in its filing about the probe, saying only that it involved “the use of Google advertising by certain advertisers.”

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The agreement highlights the risks social media companies face as they navigate privacy and disclosure norms while providing consumer entertainment online. The settlement, a consent decree, reflects neither an admission or denial of the charges by the defendants.

The FTC said Playdom, now a Walt Disney Co. unit, and former executive Howard Marks disclosed information on hundreds of thousands of children between 2006 and 2010 as they operated 20 “virtual world” websites where users could access online games and other activities.

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The agreement highlights the risks social media companies face as they navigate privacy and disclosure norms while providing consumer entertainment online. The settlement, a consent decree, reflects neither an admission or denial of the charges by the defendants.

The FTC said Playdom, now a Walt Disney Co. unit, and former executive Howard Marks disclosed information on hundreds of thousands of children between 2006 and 2010 as they operated 20 “virtual world” websites where users could access online games and other activities.

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It seems Cameron and Tyler Winklevoss, the Don Quixote twins of the digital age, have tilted at yet another legal windmill unsuccessfully.

So now, after losing another court challenge to overturn a previous court challenge, they’ll have to settle for $65 million.

Actually, $100 million, which is how much shares in Facebook have appreciated since the pair and also Divya Narendra settled with the social networking giant.

Said the ruling from the U.S. Circuit of Appeals for the Ninth Circuit, in part:

The Winklevosses are not the first parties bested by a competitor who then seek to gain through litigation what they were unable to achieve in the marketplace. And the courts might have obliged, had the Winklevosses not settled their dispute and signed a release of all claims against Facebook. With the help of a team of lawyers and a financial advisor, they made a deal that appears quite favorable in light of recent market activity. For whatever reason, they now want to back out. Like the district court, we see no basis for allowing them to do so. At some point, litigation must come to an end. That point has now been reached.

The end? Say it ain’t so! BoomTown, for one, will miss those big lugs.

Not so much Facebook co-founder and CEO Mark Zuckerberg, especially since the pair allege the tech wunderkind stole the idea for the start-up while a student at Harvard University.

After much legal mishegas, they got $20 million and 1.25 million shares at a price of $8.88 each.

And that’s more than enough, said court to the the Winklevii–it’s their eternal nickname in Silicon Valley now–and they can’t back out of a settlement they made in 2004.

As for the specifics, the three-judge panel struck down every Winklevoss argument:

- They said the terms of the Facebook deal introduced after mediation were typical.

- They said Winklevii should have been sophisticated enough to understand valuation.

- They said Winklevii couldn’t use the sealed mediation settlement documents to argue their case.

It’s true, but it’s also sad to see it all over, since all the litigiousness between Zuckerberg and the Olympic rowing brothers has been so dramatic that it was the subject of the almost Oscar-winning movie, “The Social Network.”

But maybe they can go to the Supreme Court! One can dream!

And with their latest loss and all the Google machinating against Facebook, who’s up for a sequel: “Geek Wars: The Empire and the Vii Strike Back.”

In a statement, Colin Stretch, deputy general counsel of Facebook said: “We appreciate the Ninth Circuit’s careful consideration of this case and are pleased the court has ruled in Facebook’s favor.”

Here’s the full ruling:

08-16745

Though it isn’t finalized, the proposed agreement would allow some government antitrust monitoring of its operations for the first time, potentially setting a benchmark for any future acquisitions by Google.

The settlement with the Justice Department over ITA could be just days away, the people familiar with the matter said, though the possible government shutdown at the end of this week might delay a final resolution.

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While Facebook should not be expecting big bouquets of love from its partner and investor Microsoft, at least it’s not going to be getting legal brickbats either.

According to sources close to the situation, the pair have settled a dispute over the Silicon Valley social networking site’s talent raid of Microsoft’s head of global ad sales, Carolyn Everson, for a similar job at Facebook.

In fact, Everson has already been at work for a week, sources said, after she agreed not to solicit a small group of advertising clients for a short period of time.

She is also barred from using any strategic information in her new Facebook job that she obtained while at Microsoft, sources said.

This kind of agreement is not uncommon in disputed job shifts and is also a far cry from a more stringent legal outcome, which might have benched her completely for some time.

But Everson is a veteran ad exec, having previously worked at Viacom’s MTV Networks. Thus, Microsoft could not have barred her from calling on advertisers she had known previous to her short employment there.

Still, the February hiring by Facebook came as a surprise to many at Microsoft, especially since Everson (pictured here) had been hired only last June, after a long search. In that time, she had become a high-profile presence at internal and external Microsoft events.

So, it’s clear the Everson hiring infuriated Microsoft execs, especially since the company regards Facebook as a close partner. Microsoft is a longtime investor too.

“We’re no longer angry,” said one source at Microsoft, about the cooling of tensions, “as much as disappointed.”

But key in the weighing of options at Microsoft is the obvious importance of keeping up good relations with Facebook. It is an important partnership, especially for its Bing search business, especially as an advantage over Google.

Thus: Bygones!

Huffington Post contributors griping in the wake of the site’s sale to AOL? Sure. But it’s also the same gripe that AOL users made in the dial-up era.

And–pay attention, angry bloggers–some of those AOL users eventually got paid!

The bad news: They had to go to court to get their cash, via a class action suit they filed in 1999. And they didn’t see a check until last year.

As the Columbia Journalism Review reminds us, the old, pre-Time Warner AOL used to rely on an army of volunteers–”community leaders”–to do essential gruntwork like moderating chatrooms. Wired called it a “cyber-sweatshop.“

And while it took a decade, the plaintiffs in the AOL case did end up with something for their trouble–a $15 million settlement, handed out last year.

Of course, 30 percent of that–$4.5 million–went to the lawyers, court documents show. But that’s still $10.5 million divvied up among a couple of thousand former chatroom monitors. You can’t retire on that, but you could buy a few MacBook Airs.

So could HuffPo’s angry bloggers get something for their troubles? Seems like a tough case to make: One big difference between AOL’s unpaid workers and HuffPo’s unpaid writers is that AOL really did treat its workers like workers.

It recruited them through want ads, held them to time commitments and compensated them with benefits like free or discounted dial-up access. (Remember that?)

HuffPo’s writers, on the other hand, simply handed the site some copy, which it ran–just like the people who submit op-ed pieces to newspapers. And I never hear about them demanding cash for their work. It seems quite clear that the trade is your words/their distribution.

Still, you never know! And I’m sure there’s at least one attorney, somewhere, who’s ready to try it out. Let’s check back in a decade and see how it panned out.

Here’s one from CNN. The Winklevii tell Piers Morgan that it’s not ironic that they are now active Facebook users, despite their ongoing legal and moral crusades against the company. “Technically we’re using our idea….It’s really our product and we’re the originators.” (The two grown men, somewhat oddly, make little effort to differentiate from each other, so I’ll just attribute those comments to both of them.)

And here’s one from the Daily, which shot crazy amounts of creative B-roll of the Winklevosses’ rippling muscles and chiseled jaws (they are Olympic rowers, after all). This is part one of a three-part series by the Daily’s Erin Ade, who discloses she’s a childhood friend of the Winklevii. Cameron and Tyler say they want to tell Zuckerberg to “grow up and admit to the world and yourself what you already know is true…because the moment you do that the chapter will be closed and you can move on as an individual.”

Please see the disclosure about Facebook in my ethics statement.

Something is definitely going on between Intel and Nvidia, and it’s possible that a settlement could be announced after the market closes today, sources said.

[UPDATE: Yes, they settled, in a new $1.5 billion licensing deal. Story to come.]

The two had been scheduled to go to trial in December in the Delaware Chancery Court, but the parties agreed to reschedule that.

Soon, word of settlement talks surfaced. Still, as recently as last week, a source familiar with the matter said a trial was on track for February. Now, other sources are saying that may not be the case, which would suggest a settlement is imminent.

Nvidia CEO Jen-Hsun Huang declined to discuss the Intel dispute in an interview with Mobilized’s Ina Fried at D@CES last week.

The fight between the two tech giants is over the terms of a 2004 agreement under which Intel granted Nvidia access to some of Intel’s technology for use in its chipsets, the chips that sit between the microprocessor and the graphics chip like connecting tissue. The cross-licensing agreement allowed Nvidia to make chipsets that were compatible with Intel microprocessors.

The brief was actually filed back in June, and I found a better, watermark-free copy of it here on the Web site of the Winklevoss lawyers. Last night I took the time to read it in full, and it was surprisingly not boring.

Perhaps the most revelatory thing in the Facebook filing is that Facebook’s lawyers seem to be having fun with the case. Their writing is laden with imagery and over-the-top exasperation with the Winklevii’s allegedly poorly formed legal arguments. Here’s the dramatic intro to the brief:

This appeal arises from the settlement of rancorous litigation on two coasts. On one side were Appellees Facebook, Inc. and its founder and CEO Mark Zuckerberg. On the other side were the Appellants, who founded a failing competitor of Facebook’s called ConnectU. The CU Founders claimed that they had the idea for Facebook first, and Facebook stole their idea. Facebook denied those claims and, for its part, accused ConnectU and its Founders of unlawfully infiltrating its systems, stealing millions of email addresses, and then spamming them. During a global mediation, the parties signed a “Term Sheet and Settlement Agreement.” In the interest of achieving litigation peace, Facebook agreed to purchase ConnectU for [redacted] dollars and [redacted] shares of Facebook stock, one of the hottest startups in the world. Surrounded by a bevy of lawyers, the CU Founders signed the deal. Then they suffered a bout of settlers’ remorse. They ask this Court to relieve them of the deal they struck to plunge back into scorched-earth litigation.

Besides the writing, the other thing that’s interesting is the information about the terms of the relationship between Facebook and ConnectU. While the story has been simplified into a Hollywood-style betrayal as portrayed in “The Social Network,” the outcome of Zuckerberg and the Winklevii’s legal mediation is much less widely reported.

As part of its settlement with the Winklevoss twins, Facebook agreed to acquire their social network ConnectU (which they eventually did find someone to build), and has been “operating” it since Dec. 2008, the filing says (the site itself is offline).

Facebook contends that this earlier agreement to buy ConnectU was final, while the Winklevii are calling it a draft (their co-founder Divya Narendra has publicly said he’s moved past the Zuckerberg vendetta, though he’s mentioned in the filings as well).

The settlement came after closed-door professional mediation in February 2008. Facebook says it’s outraged that the Winklevii and their lawyers are bringing conversations from mediation back into the appeal, because all involved were sworn to confidentiality.

(You can also read the ConnectU appeal brief for the case to which Facebook was responding. However the bits from the mediation that were supposed to be confidential have been blacked out.)

But after the settlement, ConnectU came back to the table asking for its share to be revalued. It had originally negotiated using a publicly reported valuation from when Microsoft invested in Facebook, rather than an internal valuation from around the same time that would have priced the shares much lower ($8.88 versus $35.90). A revaluation of the shares to a smaller amount would give the twins a larger stake in the company.

And also, the Winklevii wanted the transaction to be labeled a merger instead of an acquisition so they could avoid paying some taxes on it.

Facebook replied in the June brief, again in remarkably florid fashion:

“First, the CU Founders try to leave this Court with the impression that the only valuation figure they knew was the $15 billion figure from the Microsoft press release, and that they, therefore, had reason to enshrine it as gospel. They also portray the one 409A valuation on which they rely here as some seismic event in the life of the company, as if an unexpected bolt of lightning from on high emblazoned $8.88 onto a couple of tablets. Both the impressions are false.”

Facebook, by the way, to add insult to injury, says the internal valuation of its shares at the time of the Microsoft investment was actually even lower than the Winklevoss lawyers are arguing: Six days before the Microsoft transaction, Facebook had filed a document valuing employee stock options at just $6.61.

The attorney who signed the Facebook brief is Monte Cooper of Orrick, an intellectual property specialist. I hope he also writes novels in his spare time.

Please see the disclosure about Facebook in my ethics statement.

The company says it will comply with a court injunction to turn off “the searching, downloading, uploading, file trading and/or file distribution functionality, and/or all functionality” of its software, which remains one of the most popular methods of finding free–and illegal–music on the Web.

That means the company will stop offering downloads of its software, which you could still get on its site as of late Tuesday afternoon. And it also means that the company will disable the software that’s already been downloaded, according to people familiar with LimeWire’s plans.

I don’t know if LimeWire intends to cripple its client via a “kill switch” or some other method, but as of 20 minutes ago it hadn’t gone into effect–I was able to locate and download a version of the Clash’s “I Fought the Law” within a minute of booting up LimeWire’s software. (UPDATE for the technically minded, via a person familiar with the company’s plans: “They’ve taken down the relay severs on the Gnutella network which the Limewire client uses to figure out which other p2p clients have what info on them.” This should render existing clients effectively useless as anything other than a media player within the next nine hours, I’m told.)

LimeWire‘s client has been downloaded “hundreds of millions” of times, and is still responsible for the “vast majority” of usage on the Gnutella trading network, says Eric Garland, who runs the BigChampagne media tracking service. The company’s moves won’t affect other open source clients that run on the same Gnutella network, like FrostWire.

Meanwhile, LimeWire’s parent company, Lime Group, is prepping a new music service that it says will be legal, and should be due out in a month.

But the utility of that service depends on the participation of the big music labels, and at least for now the labels are still trying to extract a big piece of Lime Group’s hide. Court hearings in the damages phase of Lime Group’s hire are scheduled to resume in January. And this statement by industry trade group RIAA makes it clear that the labels aren’t feeling conciliatory:

“For the better part of the last decade, Limewire and Gorton have violated the law. The court has now signed an injunction that will start to unwind the massive piracy machine that Limewire and Gorton used to enrich themselves immensely. In January, the court will conduct a trial to determine the appropriate level of damages necessary to compensate the record companies for the billions and billions of illegal downloads that occurred through the Limewire system.”

Today’s announcement comes after Lime and the labels spent weeks trying to negotiate an out-of-court settlement; Federal District Court judge Kimba Wood actually handed down the injunction in August.

Here’s LimeWire CEO George Searle’s description of events, via  blog post:

As of today, we are required to stop distribution and support of LimeWire’s P2P file-sharing service as a result of a court-ordered injunction.

Naturally, we’re disappointed with this turn of events. We are extremely proud of our pioneering history and have, for years, worked hard to bridge the gap between technology and content rights holders. However, at this time, we have no option but to cease further distribution and support of our software.

It’s a sad occasion for our team, and for you–the hundreds of millions of people who have used LimeWire to discover new things.

While we have enabled open sharing and discovery for the past decade, LimeWire is mostly the product of the people who used it. You made LimeWire. Thank you for letting us being part of that. Your support and enthusiasm has fueled everything that we do.

During this challenging time, we are excited about the future. The injunction applies only to the LimeWire product. Our company remains open for business.

We remain deeply committed to working with the music industry and making the act of loving music more fulfilling for everyone – including artists, songwriters, publishers, labels, and of course music fans.Our team of technologists and music enthusiasts are creating a completely new music service that puts you back at the center of your digital music experience.

We’ll be sharing more details about our new service and look forward to bringing it to you in the future.

And here’s a LimeWire PR rep’s description of what’s going on:

As a result of a court ordered injunction, we are required to disable “the searching, downloading, uploading, file trading and/or file distribution functionality, and/or all functionality” of LimeWire’s P2P file-sharing software.

Please note LimeWire’s official statement on this legal development is as follows:

“While this is not our ideal path, we hope to work with the music industry in moving forward.  We look forward to embracing necessary changes and collaborating with the entire music industry in the future.”  – LimeWire Spokesperson.

An important point of clarification, LimeWire is not “shutting down”, in specific regarding our software, we are compelled to use our best efforts cease support and distribution of the file-sharing software, along with increased filtering.  And, that is what we are doing.

That’s not much of a surprise, given the relentless marketing campaign by the makers of “The Social Network,” which opened wide last Friday. It has garnered terrific critical acclaim.

Still, BoomTown was quite surprised to see a mention of the film on one of my favorite celebrity sites, TMZ.com.

Of course, because it is gossip-saturated, TMZ featured it as one of its naughty regular features called “Who’d You Rather?”

As in…well, you get the point.

This time they pitted Facebook CEO and co-founder Mark Zuckerberg against the Winklevoss twins in a “Facebook Fight.”

“As part of the movie ‘The Social Network,’ twin brothers Tyler and Cameron Winklevoss claim their Harvard [University] classmate Mark Zuckerberg stole their idea and created what is now this little website called Facebook,” TMZ wrote.

Also surprising, as you can see from the screenshot above, given what hunks of dudeness the Winklevii clearly are, is that Zuckerberg seems to be attracting one-third of the votes compared with their two-thirds.

And since there are two of them, the billionaire social networking wunderkind could be considered tied with the brothers!

Sweet justice after the slamming the Winklevii have been giving Zuckerberg in the media of late, even though they had signed a confidentiality agreement after their first $65 million settlement with him?

The Winklevii are trying to have that overturned and are inexplicably going for more, of course, which should keep the themes of the movie resonating for a while.

That will also be true if “The Social Network” garners some award nominations, especially the Oscar.

Also interesting will be to see if the movie will perform well this weekend or will drop off. It’s so far proved popular in the big cities on the coasts and in Silicon Valley, but now it has to go wide to make some real dough.

But, for sure, it will be on television eventually. Today, the FX cable network said it had bought the broadcast premiere rights to the movie.

According to multiple sources, Oracle CEO Larry Ellison (pictured right) approached Hewlett-Packard board member Marc Andreessen (pictured left) to help broker a settlement between the companies.

While details are sketchy, sources said the often-obstreperous tech billionaire approached Andreessen to make peace, after a lot of public razzing of HP (HPQ).

Andreessen is a more-recent addition to the HP board and has become a Silicon Valley statesman of a sort since his earlier days as its resident bad-boy wunderkind.

In addition, regulatory filings show that former HP CEO Mark Hurd, whom the board was suing for moving to a job at Oracle (ORCL) after a controversial departure, returned stock to the company in exchange for the settlement announced earlier today.

BoomTown is delighted HP took my advice!

As I wrote last week about the need for a quick settlement after all the mess created when Hurd left HP after a sexual harassment claim morphed into a bizarre Silicon Valley soap opera:

“But perhaps–after all this mishegas–it is precisely what the tech giant should do, focusing instead on finding a new leader to compete with challenges from companies such as, well…Oracle.”

From the 8-K filing with the Securities and Exchange Commission by HP:

On September 20, 2010, Hewlett-Packard Company (“HP”) announced that it had resolved litigation commenced on September 7, 2010 against Mark V. Hurd, HP’s former Chairman of the Board of Directors, Chief Executive Officer and President, for alleged breach of contract and threatened misappropriation of trade secrets in connection with Mr. Hurd’s employment with Oracle Corporation. As part of that resolution, HP and Mr. Hurd agreed to modify the terms of the Separation Agreement and Release entered into between them on August 6, 2010 (the “Separation Agreement”), a copy of which was filed as Exhibit 10.1 to a Current Report on Form 8-K filed by HP with the Securities and Exchange Commission on that same date. Under the terms of the modification, Mr. Hurd has agreed to waive his rights to the 330,177 performance-based restricted stock units granted to Mr. Hurd in January 17, 2008 referenced in paragraph 2.d. of the Separation Agreement and to the 15,853 time-based restricted stock units granted to Mr. Hurd on December 11, 2009 referenced in paragraph 2.e. of the Separation Agreement, which collectively represent the only remaining compensation that Mr. Hurd was entitled to receive under the terms of the Separation Agreement. The terms of the Separation Agreement have not otherwise been modified.

Doubtlessly, in some business tome to come, it will all be depicted in glorious detail.

And here are three real-life scenes where BoomTown would desperately have loved to be a fly on the wall:

First: The boardroom perusal of the contents of the eight-page letter from former Hewlett-Packard (HPQ) outside contractor Jodie Fisher, sent to former CEO Mark Hurd, which set in motion the circumstances of his ouster–including the odd investigation into that personal relationship that only managed to turn up dicey expense reports.

Second: The welcome-to-the company-and-screw-HP pep talk that Oracle (ORCL) CEO Larry Ellison delivered to Hurd in appointing him co-president and also a director of the database giant.

And third: The furious HP board racing to the door to file a lawsuit against Hurd for the move.

What happens next should be interesting, especially since the idea of settlement has never been one of the tools in Ellison’s wheelhouse, who is doubtlessly egging Hurd on here.

And, after yet another curveball thrown up by Hurd, it is probably not what HP’s board is angling for either.

But perhaps–after all this mishegas–it is precisely what the tech giant should do, focusing instead on finding a new leader to compete with challenges from companies, such as, well…Oracle.

As it was obligated to do, the lawsuit that HP has filed runs through all the typical charges in cases such as this–almost all of which center on the use of confidential information and how Hurd was paid off not to do exactly what he has done.

It certainly is a lot of money–estimated to be about $35 million, depending on HP’s stock price–and hinges on a two-year confidentiality agreement Hurd agreed to.

HP is correctly avoiding any noncompete language, since California–the state where both Oracle and HP are based–shoots holes in those kinds of defenses.

Instead, as it noted in its lawsuit, HP alleges that Hurd “cannot perform his job at Oracle without disclosing or utilizing HP’s trade secrets and confidential information.”

Of course he cannot, but this should not keep HP’s board from settling, as much as it will pain it to do.

Such a move could not have been helped by Ellison’s typically outrageous remarks about how HP treated Hurd, calling the break between them “the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago.”

And then yesterday’s statement by Ellison: “By filing this vindictive lawsuit against Oracle and Mark Hurd, the HP board is acting with utter disregard for that partnership, our joint customers, and their own shareholders and employees. The HP Board is making it virtually impossible for Oracle and HP to continue to cooperate and work together in the IT marketplace.”

Of course, that’s just the kind of let’s-go-to-the-mattresses noise that HP needs to ignore, now that the longtime partners are clear rivals after Oracle’s $7.4 billion acquisition of computer maker Sun Microsystems.

This purchase put Oracle directly into the server and data-storage-systems business for the first time.

That’s the real reality for HP–and not the delicious “Real Housewives of Silicon Valley” reality show this has turned into.

And–as much as I would like to see Ellison upending a table onto HP board member Marc Andreessen–no amount of legal and public wrangling with Hurd is going to change that.

If it could not work with him any longer–a corporate psychodrama about which there is still much unsaid–HP needs to move on.

Of course, Hurd should not get off for manipulating the bad situation so deftly either, and perhaps should offer to return some, if not all, of the severance paid for his silence.

Or, it could all just come out in open court and give the world a glimpse into all the twisty machinations that got us here.

Which, as you might imagine, is just fine by me–although not so much for the shareholders of HP.

HP has agreed to pay $55 million to settle allegations that it paid kickbacks to vendors who helped it win government business. The settlement follows a tentative agreement reached earlier this month in which HP resolved, without admitting wrongdoing, allegations that it had paid millions of dollars in kickbacks or “influencer fees” to systems integrators for preferential treatment on government contracts they were working on, though it had reasonable grounds to believe doing so was illegal.

“Contractors must deal fairly with the government when doing business with federal agencies,” Tony West, assistant AG for the civil division of the Department of Justice said in a statement. “As this case demonstrates, we will take action against those who seek to taint the government procurement process with illegal kickbacks.”

HP, for its part, continues to deny that it engaged in any illegal conduct. “We believe it is in the best interest of our stakeholders to resolve the matter and move beyond this issue,” it said in a statement of its own.