Is the Facebook ownership case unraveling? Paul Ceglia this week ditched his current legal team and swapped in a new firm, prompting many to speculate that the Pennsylvania native might have a long way to go before he nabs a piece of the Facebook pie.
In a Tuesday filing with a New York district court, Ceglia said he would no longer be represented by DLA Piper LLP and would instead be using Lake APC.
The Web site for San Diego-based Lake APC is currently under renovation, though it does note that the firm is now representing Ceglia. It also promised to launch a Web site, cegliavmz.com, dedicated to the case, but the site is not yet live. Lake APC did not respond to a request for comment.
"We have withdrawn from the case and no longer represent Paul Ceglia. Due to our attorney-client privilege obligations, there will be no further comment," DLA Piper said in a statement.
Who is Paul Ceglia? In 2003, he hired Facebook chief Mark Zuckerberg to do coding work for a company called StreetFax. Ceglia said Zuckerberg then persuaded Ceglia to invest in Facebook—$1,000 for a 50 percent stake in the company, plus an extra 1 percent stake for every day Facebook was not online past January 1, 2004. Ceglia, therefore, claimed to have an 84 percent stake in the social-networking site.
In April, Ceglia filed an amended complaint that included excerpts from emails allegedly written by Zuckerberg. The emails actually read like a deleted scene from "The Social Network," with Zuckerberg reportedly trying to weasel his way out of the deal, insulting Ceglia's ideas, and lying about his plans for Facebook.
A June filing from Facebook, however, said the alleged contract "is a cut-and-paste job, the emails are complete fabrications, and this entire lawsuit is a fraud." The social-networking site asked for permission to inspect Ceglia's computer and electronic media.
More recently, Ceglia said he passed a lie-detector test in which he was asked about the authenticity of his claims. Facebook, however, said the move was desperate. "Everyone knows polygraph tests are easily manipulated, which is why courts routinely disregard them," the company said.
One of the puzzling aspects of this case is that Ceglia claims to have forgotten about his stake in Facebook until last year. He told Bloomberg that the lawsuit probably would not have happened had he not been arrested for fraud and that he unearthed the alleged contract while trying to hunt down assets to pay customers of a failed wool-pellet business. Would you just "forget" that you owned an 84 percent stake in a company that was, at the time, approaching 500 million members and reportedly valued in the billions?
Editor's Note: This story was updated at noon Eastern with a comment from DLA Piper.