Facebook Wants Ownership Case Thrown Out

crimeandpunishment writes "Attorneys for Facebook and a New York man claiming majority ownership of the site faced off in a Buffalo courtroom Tuesday, and if Facebook gets its way there won't be too many more days in court. The site wants to get Paul Ceglia's claim thrown out of court. He claims a seven-year-old agreement with Facebook founder Mark Zuckerberg entitles him to 84 percent of the company. Facebook acknowledges Ceglia and Zuckerberg worked together, but says the contract Ceglia submitted was full of 'things that don't make sense.'"

Comments

make sense?

[dAzED1]

well maybe not now, when it's "worth" so much, but back then when he was just a thieving punk kid with no money the relationship was beneficial to him. Contracts don't need to be written by lawyers to be legally binding.

Re:make sense?

[Fnkmaster]

What I don't get is why would they even *think* of letting this get to court. Seriously. Even if the guy's chance of prevailing is only 10%, the downside risk is absolutely gigantic for Zuckerberg, AND for the venture capital guys that have put up a lot of money for Facebook.

Knowing as they do that the signature is legitimate, they should have offered this guy 10 or 20 million bucks to just go away rather than taking the risk that this guy will end up seizing a big chunk of equity.

Also shows you how absolutely useless the "due diligence" is that VCs perform. Zuckerberg probably never disclosed this old contract from the early days to any of his investors or they would have forced a settlement with this guy before things got this far. I've gotta think they are squirming just a bit right now.

Re:make sense?

[phantomfive]

It could be the VCs want it to go forward. Zuckerberg right now maintains the majority share (that's my understanding), and I'll bet he's a pain to work with. Suppose this guy gets 85%, he's not going to want to run the company, he's going to let the VCs do it. Major win for them.

How much money do they stand to lose? as long as they don't own more than 15% of the company (collectively), probably nothing. The loss is going to come out of Zuckerberg's share; they can sue him for fraud for not disclosing the existence of that contract. Even if they do own more than 15% of the company, they will have a way better chance of taking the company public and getting an instant payout which they've wanted to do for a while. It will give them a profit and free up their capital to invest in other projects.

Re:make sense?

[zippthorne]

What good would that do? He can owe all he wants. There wouldn't be assets under his control to cover that debt.

Full of things that don't make sense ...

[Anonymous Coward]

Don't make sense, as in, someone putting up capital being entitled to a slice of the pie? Hmm.

I predict they are screwed.

Note how they are not denying the existence of the agreement or the authenticity of the signatures on that agreement.

What makes sense and what is legally binding are two different things.

Company Hating

[phantomfive]

In all my years of Microsoft hating, Oracle hating, IBM hating, closed-source hating, I have never wanted a company to fail so much as Facebook. It is quite surreal to me, a visceral, deep-set dislike of the company and everything it stands for. It is reflexive, not even intellectual. I just can't stand them.

I thought Microsoft would be the worst, because I went through years when they were truly evil, but even at that time I never really hated Bill Gates. He's still kind of a geek, and he did work hard, even if he had an over-burdened competitive streak. And Ballmer, while he is a gorilla, he is just a gorilla. He does plenty of things that are entertaining.

But Zuckerberg is just a douche. He is like the lowest of the low, he stole the idea for the company, he doesn't care about his customers, he doesn't care about his partners, he got lucky, and he has absolutely no redeeming qualities. If Bill Gates hadn't gotten lucky working with IBM, he would have started another company and been successful, although maybe not to the same degree. That's just what kind of person he is. Mark Zuckerberg is the kind of guy who takes everything that is bad about investment bankers and brings it into the programming world. He should go back to banking where he belongs. There are lots of douches there. He would fit right in.

Re:Company Hating

[Actually, I do RTFA]

If Bill Gates hadn't gotten lucky working with IBM, he would have started another company and been successful, although maybe not to the same degree.

Microsoft was doing okay without DOS. Not anything like what they became with it, but Microsoft, and MS-Basic would have at least left Gates comfortable.

Gates was able to build a strong enough business to await a good opportunity. And then seize it. As a person, I respect him.

Re:Company Hating

[mirix]

He's the kind of guy that has actually stated "Fuck the users". Sure sounds like a real nice guy.

Fuck him and facebook.

Re:Company Hating

[DogDude]

I'd call him a douchebag because he's just another dot-commer who builds unprofitable, unsustainable "businesses" off of other people's money. He doesn't create anything of any value. All he does is spend other people's money and pays himself as if he deserves it.

The investors are greedy, stupid people who deserve to lose their money, as well, but that's another story.

Re:Company Hating

[phantomfive]

The fact that he's a douchebag is apparent from what he is done. Read some of his chat transcripts that have come out on the internet and see if you disagree. He screws everyone around him. He sucks. I don't need to character-assassinate Zuckerberg because he's done it to himself with his actions. It has nothing to do with being Jewish or graduating from Harvard. He fits in the investment banking world because the investment banking world is full of douches who like nothing better than to rip each other off. That is how the banking world works.

As for the rest, I don't know why you think I am generalizing about young entrepreneurs in general. I am not. I respect success. But not when it comes from ripping people off.

Re:Company Hating

[Culture20]

Don't get me wrong, I think Zuckerberg is a Class-A douchebag, and I hope Facebook burns, but I think it's amusing that you -- and all Slashdotters here -- would say word-for-word what Zuckerberg did, with no regrets.

Look, Slashdotters think they're Aspies, not Sociopaths. When I refer to my users in the words Zuck used, I don't also snicker and say "they 'trust' me". I call my users dumb ^@$& because they screw something up, but then I fix it for them because I care about them (the job actually does come second). Zuckerberg was ridiculing people for exhibiting a good behavioral trait: trust. He thought it was funny that he could abuse^Wrape that trust. That's a mental illness.

Deal with the devil - time to pay up...

[hadesan]

Mark, come on man - give the man his due - it's only 84% of the stuff you ripped others off for...

What's this got to do with "my rights online"?

[John Hasler]

It's a contract dispute between two individuals. The outcome will depend on the facts of the case and the judge's interpretation of the contract. No rights involved, except for the plaintiff's exercise of his right to sue.