Did Zuckerberg Give Up Facebook Ownership Stake in 2003?

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REUTERS/Robert Galbraith

In a federal court hearing on Tuesday, Facebook said it was “unsure” whether founder Mark Zuckerberg signed a contract giving Paul Ceglia an ownership stake in the company.

Ceglia sued Zuckerberg and Facebook in a local court last month, saying in 2003 he signed a contract with Zuckerberg to work on two different projects. One was to develop software for a “StreetFax database,” and the second was the “continued development” of a side project for Harvard University students, with the potential name “The Face Book.”

The local judge put a restraining order on Facebook, forbidding them from buying or selling its assets. Facebook thus brought the case to federal court, where the judge suspended the order.

Ceglia’s attorneys say the contract is binding, giving their client a stake of at least 50 percent in Facebook. Facebook’s attorneys question the logistics of the suit, as the contract was dated several months before Zuckerberg reportedly started work on Facebook. If Ceglia wins the case, a whole lot of money is in the balance.

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