Paul Ceglia
Declaring it a “massive fraud” and a “farce,” Facebook is demanding a federal judge dismiss a lawsuit that claims a New York man owns half of the social-networking service.
In documents filed late Friday, Facebook noted for the first time that the plaintiff in the suit was arrested last month and has been charged with a multi-billion-dollar scheme to defraud the social-networking site and its chief executive and founder Mark Zuckerberg through his lawsuit.
Paul Ceglia, of Wellsville, New York, was released on $250,000 bond days ago. He filed his federal lawsuit in 2010, citing documents and a contract between him and Zuckerberg that promised him 50 percent of the social networking site. His lawsuit prompted the federal fraud charges, yet the lawsuit is continuing unabated.
“This lawsuit is a massive fraud on the federal courts and defendants,” Facebook said in its filing (.pdf) last week. “It has now descended into farce.”
Facebook and New York federal prosecutors aren’t the only ones who believe Ceglia fabricated evidence to suggest that he owned half of Facebook.
Facebook submitted to the court correspondence from one of nine law firms that represented Ceglia in his lawsuit. The letter, between attorneys Aaron Marks to Dennis C. Vacco, said Marks believed that the contract at the heart of the dispute “is fabricated.” (.pdf)
Ceglia, a wood pellet salesman, is now accused of one count of mail fraud and one count of wire fraud (.pdf). Each count carries a maximum 20-year term.
Facebook has made it clear from the beginning that it believed the contract and e-mails that Ceglia has produced as evidence were fake — and the company even hired private investigators to dig up dirt on Ceglia’s checkered past.
Facebook told a federal judge that forensic examiners proved that the contract Ceglia submitted to the court was “forged.” The analysis also claimed that 27 e-mails between Zuckerberg and Ceglia — some of which mention Facebook — were “fabricated” by Ceglia.
Zuckerberg maintains that an authentic “Work for Hire” contract between the two did exist, but it involved another project altogether. Ceglia hired Zuckerberg to work on Ceglia’s StreetFax company nearly a decade ago, Zuckerberg claimed. Ceglia, however, alleges the contract also discussed fronting Zuckerberg $2,000 in exchange for half of Facebook when Zuckerberg was a Harvard University computer science student.
No court dates have been set in either the civil or criminal case.