Tech lawsuits in Silicon Valley are a dime a dozen, but the legal battle involving Facebook and one Paul Ceglia was unique for a number or reasons. Ceglia, if you recall, filed suit against Facebook in 2010 alleging that he was entitled to an 84% ownership stake in the popular social network.
What made the case so interesting was that Ceglia actually purported to have documents bolstering his case. As it turns out, Ceglia actually contracted Facebook founder Mark Zuckerberg to do some web development for him while Zuckerberg was still a Harvard student. At the time, Ceglia claimed the two also reached an agreement entitling him to an ownership stake in what would later become Facebook.
When Ceglia filed the suit, Facebook and Zuckerberg vehemently denied the allegations. As the case proceeded through the court system, it was discovered that Ceglia fabricated the documents on which his case relied. Indeed, Facebook from the very outset of the case said that Ceglia was a con man who possessed nothing more than phony documents.
In 2011, DLA Piper, the firm representing Ceglia, withdrew from the case. Notably, DLA Piper in the preceeding months swore up and down that the evidence bolstering Ceglia's position was authentic. Naturally, the lawsuit was ultimately dismissed.
Now, Facebook is suing DLA Piper, alleging that the large law firm should have known that the documents at issue were contrived.
Monday’s lawsuit, which Facebook filed in New York County Supreme Court, claims Ceglia’s lawyers “knew or should have known that the [initial] lawsuit was a fraud.”
“We said from the beginning that Paul Ceglia’s claim was a fraud and that we would seek to hold those responsible accountable,” Facebook General Counsel Colin Stretch said in a statement given to Re/code. “DLA Piper and the other named law firms knew the case was based on forged documents, yet they pursued it anyway, and they should be held to account.”
This one will certainly be interesting to follow. For what it's worth, DLA Piper issued a response to Re/Code stating that Facebook is simply trying to intimidate lawyers "from bringing litigation" against them. DLA Piper further states that they only represented Ceglia for a mere 78 days.
DLA Piper, which was not part of this case at its outset or its conclusion, was involved for 78 days. Facebook and Mr. Zuckerberg claim that they were damaged in those 78 days, yet a mere 10 months after DLA Piper withdrew from the case and while the litigation was still pending, Facebook went to market with an initial public offering that valued the company at $100 billion.
Let the games begin.