Facebook is being sued for an 84 percent ownership stake.
When I first saw the story Wednesday, I thought, "Who is this guy kidding?" But as time passes and more publications pick it up, I'm beginning to think there might be more to it than Facebook wants to admit. Here's the skinny, from InformationWeek's Alison Diana:
Paul Ceglia filed suit against Facebook and CEO Mark Zuckerberg, claiming an April 2003 contract now entitles him to an 84 percent ownership stake in Facebook.... Under the contract..., the designer received $1,000 and a 50 percent stake in the site which eventually became Thefacebook.com, according to the suit. The lawsuit also says Ceglia is entitled to "an additional 1 percent interest in the business for every day after Jan. 1, 2004, until it was completed."
Eighty-four percent of Facebook would be worth between $5.6 billion and $9.24 billion.
Last week the Allegany, N.Y., County Court entered a temporary restraining order preventing Facebook from moving assets around while the case persists. Facebook's only response at this point, according to CBS News, has been to call the lawsuit "completely frivolous" and vow to defend itself "vigorously."
Facebook is not a stranger to litigation over ownership. Consider the ConnectU case that it settled in 2008 for some $65 million. But neither is Ceglia unfamiliar with the system. CBS News reports that last year, New York attorney general Andrew Cuomo accused Ceglia's wood pellet fuel company of defrauding consumers of $200,000.