The Social Network Part Two? The emails which could cost Mark Zuckerberg HALF of Facebook





Lawsuit: Paul Ceglia is suing Facebook founder Mark Zuckerberg for a 50 per cent stake in the company

When a judge threw out an appeal by the twins who claimed they had the idea for Facebook first, it seemed the long-running legal feud dramatised in The Social Network had finally come to an end.

But today it appears there could be scope for a sequel, after Mark Zuckerberg became embroiled in a fresh legal row over the ownership of Facebook.



Paul Ceglia, of Wellsville, New York, has released emails which he says prove Mr Zuckerberg offered him a 50 per cent stake in the fledgling social network in exchange for $1,000 start-up funding.

He alleges Mr Zuckerberg downplayed the popularity of the site after its launch at Harvard University in February 2004 and soured their business relationship to try to make him pull out of the deal.



Mr Ceglia - who has a conviction for criminal fraud - first made the claims last year, but Mr Zuckerberg dismissed them as fake.

Now he has filed his lawsuit again, this time with a dozen emails which apparently support his ownership claim.

They first worked together in April 2003 when Mr Zuckerberg agreed to do some coding work for Mr Ceglia's website StreetFax. He was paid $1,000.



According to the lawsuit, Mr Zuckerberg then mentioned a 'great project', for an 'online, interactive yearbook' called 'The Face Book', and asked Mr Ceglia if he would like to invest $1,000 in exchange for a 50 per cent stake in the website.

The pair allegedly signed the contract at a Boston hotel on April 28, 2003. It gave Mr Ceglia a 50 per cent stake, and also said he would receive an additional one per cent stake in the project for every day it remained uncompleted beyond its launch date.

Billionaire: Facebook founder Mark Zuckerberg now enjoys a personal fortune of $13.5bn, according to an estimate made by Forbes magazine

In July last year, Mr Ceglia claimed that would translate into an 84 per cent of Facebook because its launch was delayed. In the latest lawsuit, he is asking for an equal share.a



The email exchange begins in July 2003, when the pair initially discuss how to make money from the site. Mr Zuckerberg proposes introducing a monthly fee, but Mr Ceglia argues he should keep it free and instead generate revenue with branded mugs and t-shirts.

He writes: ''Maybe we could make it free until it was popular and then start charging?'

In one email, dated November 2003, Mr Zuckerberg allegedly mentions 'a couple of upperclassmen here at Harvard that are planning to launch a site very similar to ours'. He says he has 'stalled them for the time being' but says he must 'make a move soon'.



The reference is presumably to Tyler and Cameron Winklevoss, against whom Mr Zuckerberg won a final legal victory on Monday after a long-running dispute dramatised in The Social Network.



Victory: Mark Zuckerberg finally won his legal battle with Cameron and Tyler Winklevoss, but now he faces fresh ownership claims

Facebook gave the pair a $65million settlement in 2008, after they launched a lawsuit claiming he had stolen the idea for the social network from their website ConnectU.

He had already been forced to list his original backer, Eduardo Saverin, as a Facebook co-founder in a settlement which recognised his original $15,000 investment while the pair were Harvard classmates.

Mr Zuckerberg's relationship with Mr Ceglia relationship gradually disintegrates as the exchange continues, as Mr Zuckerberg keeps pushing back the launch of Facebook. At one point, Mr Ceglia angrily threatens to call his parents.

It sours still further as Mr Zuckerberg seeks to extricate himself from the terms of the contract - specifically, the clause which would give Mr Ceglia an extra stake if the project was overdue.



In an email dated February 2004, just two days before the launch, Mr Zuckerberg allegedly wrote: 'Paul, I have a rather serious issue to discuss with you, according to our contract I owe you over 30 per cent more of the business in late penalties which would give you over 80% of the company...



'I’d like to suggest that you drop the penalty completely and that we officially return to 50/50 ownership.'

Face to Facebook: Mark Zuckerberg, right, meets actor Jesse Eisenberg, right, who played his character in The Social Network

The Social Network: The 2010 film starring Justin Timberlake, left, as Napster founder Sean Parker, another investor, and Jesse Eisenberg as Mark Zuckerberg

In his federal court complaint, Mr Ceglia said the emails show how Mr Zuckerberg tried to get him to abandon his interest in Facebook by souring their business relationship in 2004.



This appears to centre round an email allegedly sent by Mr Zuckerberg on April 6, 2004, when he says: 'Paul, I have become too busy to deal with the site and no one wants to pay for it, so I am thinking of just taking the server down.'

Unhappy partnership: Mark Zuckerberg eventually agreed to list Eduardo Saverin as a Facebook co-founder in recognition of his $15,000 investment

But by this point, two months after its launch, Facebook had already become wildly successful - half of Harvard was signed up to it and it had been extended to Stanford, Colombia and Yale.



The complaint says: 'Zuckerberg knowingly misrepresented to Ceglia that thefacebook.com was not successful, that he was too busy to deal with the website, that he had lost interest in the website and that he was shutting the website down.'

Mr Ceglia now contends that, in accordance with the original agreement, he is entitled to an equal share of Mr Zuckerberg's ownership of the social network, which has more than 500million users across the world.

Mr Ceglia's updated claim has been lent credence by one the world's biggest corporate law firms, DLA Piper, who took on his case recently after 'weeks' of due diligence to ensure its validity.



Dennis Vacco, an attorney representing Mr Ceglia, said: 'The beauty of the e-mails is they represent a contemporaneous account, not viewed from the prism of the present day "man of the year", but viewed from the eyes of a Harvard student at the time these events were actually occurring.'

Orin Snyder, an attorney for Facebook, called the claims 'ridiculous.'

'This is a fraudulent lawsuit brought by a convicted felon and we look forward to defending it in court,' Snyder said in an e-mailed statement to The Associated Press yesterday.

Mr Ceglia was put on probation in 1997 after pleading guilty to possession of hallucinogenic 'magic' mushrooms, Panola County, Texas, court records show. He was also charged with criminal fraud in connection with a wood pellet company he operated.