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Zuckerberg escapes scrutiny in Facebook ownership case

Ceglia wins time for experts to examine his claims

Internet Security Threat Report 2014

Paul Ceglia, who is claiming ownership of half of social-networking giant Facebook, won't get to cross-examine CEO Mark Zuckerberg or examine his computer records, a court ruled on Wednesday – but he has bought himself some time to get in expert witnesses.

"We are very pleased with today’s ruling," Orin Snyder, a New York attorney representing Facebook and Zuckerberg, told the Associated Press. "The court denied Ceglia's request for broad discovery and continues to focus these proceedings solely on the question of Ceglia's criminal fraud."

Ceglia claims that he entered into a contract with Zuckerberg in 2003 to develop two companies: a traffic data website called StreetFax and a social network called thefacebook.com. In exchange for an investment of $1,000, Ceglia claims he was promised half of the latter, and in his original suit invoked a penalty clause that would give him 84 per cent of the shares in Facebook – although he's said that he'll settle for 50 per cent.

While Zuckerberg acknowledges he worked for Ceglia on StreetFax, he says the rest of the contract is nothing more than a fraud. After a detailed examination of Ceglia's evidence, Facebook claims that the contract is a fake, as are emails purporting to be from Zuckerberg that confirm parts of Ceglia's story.

Facebook's experts claim that the age of the ink on the contract shows that the details on Facebook were entered later than the StreetFax contract, and have pointed out many other inconsistencies in Ceglia's evidence. The court ruled that Ceglia could bring in his own experts to challenge Facebook's, but that he couldn't call Zuckerberg to the stand or go over the Facebook CEO's computers for evidence.

"We are hopeful that once we have obtained and presented this information, the court will deny the defendants' motions to dismiss and allow the case to proceed to full discovery and an eventual trial," a statement from Ceglia's lawyers said.

On the face of it, Ceglia appears to have little hope of success in his claim – at least as far as El Reg can make out. The New York fuel salesman only brought his case in 2010, nearly seven years after signing the "contract" (he claims he'd lost it and found it again), he's been fined for not producing evidence, and has been abandoned by not one but two lawyers.

It's perhaps a measure of the nature of the American legal system that the case has dragged on this long, based on what looks like very shaky evidence. Nuisance legal cases are quite common, and Ceglia may have been hoping to reach a quick settlement to make him go away.

It appears, however, that Facebook's legal team are keen for a fight, and Ceglia could be facing legal problems of his own if his case falls down and Zuckerberg is feeling vengeful. ®

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