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Facebook lawsuit ends with claimant arrested for fraud

updated 04:40 pm EDT, Fri October 26, 2012

New York man falsified information claiming partial ownership

Entrepeneur Paul Ceglia, one-time claimant to Facebook billions, has been charged with mail and wire fraud over what federal prosecutors and the US Postal Inspection Service have determined to be falsified information. Ceglia sued Facebook and its CEO in 2010 on the strength of the forged information, claiming that a 2003 contract he signed with Zuckerberg entitled him to a stake in the social network. Zuckerberg had previously done programming work for Ceglia while at Harvard.

In his lawsuit, Ceglia claimed that Zuckerberg shared his plans for a social networking site with him while working at StreetFax. He contended that their contract granted him part ownership in the project in exchange for a $1,000 investment. To build his case, Ceglia submitted what he said were emails from Zuckerberg that proved the pair had discussed the project that would eventually become Facebook.

Ceglia sought "a quick pay day based on a blatant forgery," U.S. Attorney Preet Bharara in Manhattan said in a statement announcing the criminal charges. "Dressing up a fraud as a lawsuit does not immunize you from prosecution."

As part of that case, Facebook attorneys released emails sent by Zuckerberg to show Ceglia's claims were false. The attorneys cited work by forensic experts who found that Ceglia had typed text into a Microsoft Word document and declared it was the text of emails with Zuckerberg.

"Ceglia used the federal court system to perpetuate his fraud and will now be held accountable for his criminal scheme," Orin Snyder, a partner at law firm Gibson Dunn who is representing Facebook and Zuckerberg in the civil case, said in a statement.



By Electronista Staff
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