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Facebook Says Contract Cited in Ownership Claims Multi-Billion Lawsuit Is 'Fabrication'

Mark Zuckerberg
Justin Sullivan/Getty Images

In a suit filed last year, Paul Ceglia claimed that CEO Mark Zuckerberg agreed to give him a stake in Facebook in exchange for $1,000 in start-up money.

NEW YORK - Facebook said it has discovered an “authentic contract” between its CEO Mark Zuckerberg and Paul Ceglia that shows that the latter’s claims to an ownership stake in the social networking company are phony, Bloomberg News reported.

In his suit filed last year, Ceglia claimed that an agreement with Zuckerberg for $1,000 in start-up money entitles him to half his stake in Facebook, now valued in the billions of dollars.

The newly found contract document, which doesn’t mention Facebook, was discovered on Ceglia’s computer as part of court-ordered forensic testing, the networking giant said in papers filed Monday in federal court in Buffalo, New York, according to Bloomberg.   

The filed court papers include a blurry image of the contract, which is dated 2003 and includes signatures from Zuckerberg and Ceglia, it said.

“This smoking-gun evidence confirms what defendants have said all along: the purported contract attached to the complaint is an outright fabrication,” Facebook said in its filing. 
 
The company also said it found evidence that Ceglia is concealing six removable storage devices containing documents with names that include “Zuckerberg Contract page1.tif.”

“It is very likely that Ceglia used these removable devices to manipulate and store documents, including the purported ‘Facebook contract,’ in the belief that this evidence would not be discovered - or that the devices could easily be discarded if necessary, as Ceglia has now apparently done,” Facebook said.
 
A hearing in the case is scheduled for Wednesday.

Facebook is currently valued at $69.2 billion, according to Sharespost.com, an online market for the shares of privately held companies.