Facebook Assets Frozen in Face of Lawsuit

A web programmer named Paul D. Ceglia claims that Mark Zuckerberg, founder of Facebook, contracted with Ceglia back in 2003 to develop a website that he called ‘The Face Book’. This contract is the basis of a lawsuit Ceglia filed in the New York Supreme Court.

In his suit, Ceglia says that this contract stated that he would be paid $1000 upfront and 50% ownership in the website. The contract also says that Ceglia was to get an increase in that ownership for each month until the contract was completed, starting with January, 2004. He is now suing for 84% of the company and unspecified monetary damages for having been deprived of that ownership to the date of filing.

According to the experts, the estimated current value of Facebook is upwards of $9 billion. Ceglia has asked the court for declaratory judgment and relief based on current value. Facebook has already stated that the “suit is completely frivolous” but the judge has ordered a temporary freeze on company assets until the case can be heard.

Facebook and Mark Zuckerberg have faced a lawsuit before. Back in 2007, three former Harvard classmates accused Zuckerberg of stealing both the programming code and the business plan from them when they were all in school. In that suit, a confidential settlement was reached that gave the three former classmates $65 million in Facebook stock and cash but it was never revealed whether the accusations had any truth to them.

With Facebook now reaching the milestone of the most visited website in history, this lawsuit could be a huge blow to the future of the social networking site. At this point, no one knows for sure as the contract has not been made public. There has been no word of a hearing date on the matter as of yet.