Facebook, Lawsuit of the Day, Social Networking Websites

Facebook Wants to De-Friend State Court

The meteoric rise of Facebook has tended to inspire lawsuits by those who claim to have collaborated with Mark Zuckerberg in the site’s creation. The latest to make a claim on the 500-million-member site is a wood chipper man in New York. We don’t understand how Paul D. Ceglia went from writing code to producing wood pellets, but so be it.

In his lawsuit (via Gawker), he claims to have made a contract with Zuckerberg in 2003 to help design “The Face Book” for $1,000 plus 50% of the site’s revenue, with an added 1% per day until the site was launched. This sounds like the stupidest (and most typo-ridden) contract ever — Zuckerberg went to Harvard and this guy chops wood, so we’re skeptical (though we do know the Ivy League doesn’t teach common sense).

The Guardian reports that Facebook has “dismissed the case as ‘frivolous’ and ‘outlandish’, said it will fight it vigorously and pointed out that a lawsuit over a contract broken in 2003 is ‘almost certainly barred’ by the statute of limitation.”

The judge in Allegheny County Supreme Court is taking the claim very seriously though. Judge Thomas Brown has frozen Facebook’s assets while the case is pending…

From the Wall Street Journal:

A New York judge has issued a temporary restraining order restricting the transfer of Facebook Inc.’s assets, following a suit by a New York man who claims to own an 84% stake in the social-networking company.

Paul D. Ceglia filed a suit in the Supreme Court of New York’s Allegany County on June 30, claiming that a 2003 contract he signed with Facebook founder and Chief Executive Mark Zuckerberg entitles him to ownership of the company and monetary damages.

The suit is being heard by Judge Thomas Brown, who issued the temporary restraining order earlier this month.

Ryan Tate at Gawker explains the problem with this for Facebook:

Ceglia’s claims have suddenly become important, because the temporary block placed on Facebook effectively bars it from raising money, since fundraising requires a transfer of equity.

Zuckerberg is being represented by Lisa Simpson and Daniel Robertson of Orrick. They’re filed a motion to dissolve the temporary restraining order and are trying to get him the hell out of state court and into the sane litigation environment that is federal court.

Man Claims Ownership of Facebook [Wall Street Journal]
Facebook’s Assets Frozen Over Insane Legal Claim [Gawker]
Facebook facing lawsuit as New Yorker claims 84% of firm [Guardian]

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