Feds arrest Paul Ceglia over Facebook ownership claims
Gumshoes go all Al Capone on alleged fraudster
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A wannabe billionaire who claimed to own 84 per cent of Facebook based on a contract Mark Zuckerberg signed as a student has been arrested and charged with fraud.
Paul Ceglia was arrested after being indicted for two counts of fraud: one case of postal fraud and one of wire fraud. If found guilty he faces a possible 40 years behind bars, giving him the opportunity to make lots of new friends.
In 2010, Ceglia began a legal challenge to Facebook, asserting that he had a contract with Zuckerberg, signed while the latter was a student at Harvard, giving him 50 per cent of the social networking giant in exchange for a $1,000 investment. Ceglia's contract also specified that he would get more of the company if Zuckerberg was late to get code out.
In his initial legal filing, Ceglia claimed 84 per cent of Facebook, although later he amended this in the spirit of compromise to claim just the original 50 per cent. While Zuckerberg admitted to having worked for Ceglia on a project called StreetFax, he strongly denied signing over any of Facebook, calling the case a "brazen and outrageous fraud on the court".
According to the indictment, this appears to be the case. The court found that Ceglia had used part of the StreetFax contract with Zuckerberg for evidence, replacing one of the pages with a new sheet of paper outlining his claim on Facebook. An examination of the document showed the two pages had different line and margin spacing, as well as inconsistencies in formatting.
Ceglia had also sought to bolster his case with emails, which he claimed showed Zuckerberg was aware of the contract. Investigators found that emails that purported to be from 2003 were in fact created in 2011 and then altered to make it look older by editing metadata. None of the emails claiming to mention Ceglia's involvement in Facebook were found in Harvard University's backup tapes.
Ceglia's claims have been treated with suspicion right from the start. He claimed to have only found the contract recently, coincidently just as the buzz about Facebook going public for billions was ramping up. Yet if he knew such a contract existed with the poster child of the social networking industry, one would have thought he'd have done some checking before 2010.
He also has a record of less-then-honorable behavior. In 2009, the New York Attorney General took out a restraining order against Ceglia's wood pellet fuel company for failing to deliver supplies to its customers while taking their money. True, people can change and become law-abiding characters, but this should have raised some eyebrows.
Nevertheless, Ceglia found lawyers willing to take up his case. His first team, from the well-respected firm DLA Piper, took him on, saying it had checked the evidence and was convinced. After Piper dropped him, Ceglia went through a string of legal advisors who either dumped or fell out with him.
Ceglia's case against Facebook now appears to be over, but it's a pretty savage indictment of the American legal system that he was able to make such a fuss based on such shoddy evidence and past character. ®
COMMENTS
Freedom only for the deserving?
"... but it's a pretty savage indictment of the American legal system that he was able to make such a fuss based on such shoddy evidence and past character."
Whoa dude! Think about what you just said. If you're a low-life, or might be a low-life, you have no or limited rights?
Sorry guy, even prostitutes can have someone arrested and convicted for rape, given the evidence supports the case. The case is what should be judged, not the person bringing the case.
Of course when the evidence is found to be cooked and the case was fraudulent to begin with, throw the book at the fraudster indeed! I wish more nuisance lawsuits had negative results for the idjits trying the 17th time to make trouble for someone they don't like.
BTW: the above, anyway, knowing someone who sued the local council for being arrested, at a public meeting, for recording said meeting, where the council was agreeing to something illegal, and she lost the case, and $23K in legal fees down the drain, even though the judge agreed she had the truthful evidence! Justice is not done sometimes even when you're in the right. She felt getting the contradictions and collusion into the record worth the money. It ain't justice accomplished, but at least she got the trial.
Re: a pretty savage indictment of the American legal system...
> Convicting 14 & 15 year olds to life in prison because they accidently killed their friend by copying wrestling moves on TV
Nice sound bite, now for some facts.
The friend in question was a 6 year old girl who suffered a fractured skull, lacerated liver plus over 30 other injuries from being punched, kicked, stomped on and thrown multiple times. Do you think she asked him to stop? His claim that he was only copying wrestling could not account for all the injuries and the only other witness to what happened was the dead girl.
Because of his age he was offered a deal that would have seen him serve only 3 years in a juvenile prison and 10 years probation but he (and his family) refused to take any responsibility for his actions and attempted to get him off by claiming wrestling was to blame.
The verdict (and sentence) was overturned on appeal and he subsequently accepted the 3 year deal.
He is now serving 30 years for violating probation after being arrested for armed burglary with battery and armed robbery.
DLA Piper made some pretty strong statements, even after they should have known that it was a fraud. They would have happily split the take from the extortion. They only quit the case after it was clear it would cost them money.
Anonymous because it's dangerous to say something negative about a powerful law firm, even if it's just pointing out the obvious: that they lent their power to an extortion scheme.
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