"They have definitely been talking, hanging out and, yes, hooking up," The Sun quoted a friend as telling Usmagazine.com. The 'You, Me and Dupree' co-stars were also seen spending time at each other's homes in Los Angeles before the Oscars. Both also made an appearance at pop diva Madonna's post-Oscar party. "There was lots of arm touching, giggling. They were having lots of fun," an eye-witness told People magazine.