Facebook Inc Chief Executive Mark Zuckerberg says a lawsuit by a man who claims to own a huge chunk of the popular social networking website is seeking to uncover unnecessary details about his private life to harass him.
Zuckerberg is fighting a civil lawsuit filed by Paul Ceglia, an upstate New York resident who claims an 84 percent stake in the privately held company, believed to be worth several billion dollars.
Ceglia, an owner of a wood pellet fuel company who lives in Wellsville, New York, is trying to return the case to a New York state court, after Zuckerberg moved it to federal court.
“They filed this remand motion to harass defendants under the pretext of obtaining jurisdictional discovery into Zuckerberg’s private life,” lawyers for Zuckerberg said in a Monday filing in the federal court in Buffalo, New York.
Ceglia alleged in a June 30 lawsuit that a 2003 contract with Zuckerberg entitles him to control of Facebook. Forbes magazine in March estimated Zuckerberg was worth $4 billion.
Federal courts can hear cases from parties in different states. Zuckerberg, 26, considers himself a California citizen, while Ceglia said both men are New Yorkers.
“The higher the stakes, the more likely you want to take advantage of procedural moves to improve your chances of winning, or settling on the most favorable terms,” said Adam Steinman, a professor at Seton Hall University School of Law in Newark, New Jersey.
Steinman said “conventional wisdom” is often that defendants prefer federal court to state court, because cases might be dismissed faster or less likely to reach juries. “There could also be a ‘home-field’ advantage if a state judge were more sympathetic to a local plaintiff,” he said.
It is unclear what details Ceglia hopes to uncover, or Zuckerberg wants to keep from being revealed.
Social networking companies such as Facebook have long faced concerns over privacy. They must balance users’ concerns about how much personal information is made public with a need to generate revenue by sharing details with advertisers.
In May, Facebook introduced tools to give users more control over what information is shared.
Zuckerberg, a Dobbs Ferry, New York native, launched Facebook in February 2004 as a Harvard University sophomore. He dropped out after that year and moved to California.
Now based in Palo Alto, California, Facebook said it has more than 500 million users and 1,600 employees.
Terry Connors, a partner at Connors & Vilardo LLP in Buffalo who represents Ceglia, said he expects to respond to Zuckerberg’s allegations in a court filing within two weeks.
Facebook, in an emailed statement, said “Ceglia’s claim that Mark Zuckerberg lives in New York is another ridiculous and demonstrably false claim in an already absurd lawsuit.”
In June, Zuckerberg said he had no date to take Facebook public. The next month, he told ABC News he was “quite sure” there was no contract ceding Facebook ownership rights.
A hearing on Ceglia’s lawsuit is set for October 13.
The case is Ceglia v. Zuckerberg et al, U.S. District Court, Western District of New York, No. 10-00569.