Paul Ceglia Thanks Arrest For Reminding Him Of Facebook Ownership

The man suing Facebook for 84% ownership of the social networking site has told Bloomberg that he can thank a state fraud investigation for unearthing 2003 documents purporting to give him a stake in Zuckerberg’s start-up.

Paul Ceglia from Wellsville in western New York state filed suit on June 30, claiming he owns most of Facebook under an old 2003 “work for hire” contract back when founder Mark Zuckerberg was a college freshman. He also claims to have a year’s worth of email correspondence with Zuckerberg to support his case.

In the Bloomberg story, the businessman claimed that it took him this long to bring the case because he had forgotten about it. He was reminded when a separate fraud investigation into his wood-pellet start-up prompted him to start trawling through old documents looking for assets to help pay back debts. “If this thing hadn’t happened the way it happened, no way I would have ever started looking through these ancient folders,” Ceglia told Bloomberg. “That contract would just be sitting in there gathering dust.”

However, Ceglia’s claim would not go unchallenged, even if he is successful. Bloomberg also interviewed Andrew Logan, StreetDelivery’s founder and chief executive, who called Ceglia a “real opportunist” and said he “didn’t have much good to say about him”. Logan has claimed Ceglia was under contract to StreetDelivery in 2003 when he set up StreetFax and hired Zuckerberg. If Ceglia’s contract with Zuckerberg gives Ceglia an ownership interest in Facebook, Logan said the stake may in fact belong to him.

Ceglia apparently hired Zuckerberg to write code for his StreetFax start-up and claims he invested $1000 into Zuckerberg’s venture, which is referred to as both “The Face Book” and “The Page Book” in the document. Facebook claims that Zuckerberg did some work for Ceglia in 2003 but did not conceive of Facebook until 2004. The describes the lawsuit as “frivolous” and says the contract must be fake. So far Ceglia has only produced a photocopy.

If imitation is the sincerest form of flattery, someone claiming they actually have an ownership stake in your company must be a close second. But Facebook is likely to be annoyed rather than flattered by the string of litigators trying to get a stake in the social networking company, which now boasts 500 million users.

The case is Ceglia v. Zuckerberg, 10-CV-00569, U.S. District Court, Western District of New York (Buffalo).

Photo Credit: Picture of Paul Ceglia from Bloomberg.