NY Investor: Facebook Is Mine

He says he put up early $1K for 84% of company
By Mary Papenfuss,  Newser User
Posted Jul 13, 2010 3:18 AM CDT
Facebook CEO Mark Zuckerberg.   (AP Photo/Marcio Jose Sanchez)

(Newser) – A New York investor who is arguing he owns 84% of Facebook because of a financial arrangement with founder Mark Zuckerberg has blocked a planned transfer of company assets. A judge has issued a temporary restraining order halting the transfer until the court can decide the merit of the case. Paul D. Ceglia says he signed a contract with Zuckerberg in 2003 paying him $1,000 to develop and design a website that later became Facebook. In exchange, Ceglia was to get 50% of the product and an additional 1% interest in the business for every day after Jan. 1, 2004, until the site was completed, according to his suit. A Facebook statement called the suit "frivolous."

Wall Street Journal reporter Geoffrey A. Fowler has seen a copy of the contract, which states it's "for the purchase and design of a suitable website for the project" Zuckerberg has "already initiated" of a website "similar to a live functioning yearbook with the working title of 'The Face Book.'" One industry analyst warned the suit could be in jeorpardy because it's beyond the 6-year statute of limitations; another predicted Facebook will deal with the case "pretty quickly." Ceglia was last in court when he was accused of defrauding customers of his wood-pellet fuel company. That case is also ongoing.

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