Judge: NY Man Must Face Fraud Charges in Fake Facebook Claim - The Jewish Voice
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Judge: NY Man Must Face Fraud Charges in Fake Facebook Claim

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Paul Ceglia brought a lawsuit against Facebook in 2010, claiming 84% ownership in the company.
Paul Ceglia brought a lawsuit against Facebook in 2010, claiming 84% ownership in the company.
A New York businessman must face criminal fraud charges for fraudulently claiming a billion-dollar stake in the social media company Facebook, a federal judge ruled on Friday, March 7, Vosizneais reported.

Paul Ceglia, 40, is accused of forging a 2003 contract with Facebook CEO Mark Zuckerberg that supposedly entitled him to part ownership of the company.

Following a one hour hearing in New York, U.S. District Judge Andrew Carter then rejected Ceglia’s request to dismiss the charges, finding that he had failed to meet the “high standard” needed to dismiss an indictment by the grand jury.

Ceglia sued Zuckerberg and Facebook in 2010 in a federal court in Buffalo, New York. He claimed that he and Zuckerberg had signed a contract while Zuckerberg was still a Harvard University freshman. The contract was for Ceglia to invest $1,000 in a planned social networking website, according to reports.

Vosizneias reported that Zuckerberg had previously done some programming work for Ceglia’s Streetfax.com company. Facebook has argued that the only contract between the two men was related to that company and had accused Ceglia of faking documents to further his lawsuit.

Last year, a Buffalo judge had recommended that Ceglia’s lawsuit be dismissed, finding that it was “highly probable and reasonably certain” that the contract was fabricated in order to pursue the lawsuit. The federal judge overseeing the case has not yet ruled on that recommendation.

But in 2012, New York prosecutors in New York charged Ceglia of forging documents as part of the Buffalo litigation.

Since that time, Vosizneias reported, Ceglia has filed a separate lawsuit against Manhattan U.S. Attorney Preet Bharara, whose office is prosecuting Ceglia, and U.S. Attorney General Eric Holder. The lawsuit seeks to halt the criminal case.

On Friday, Ceglia’s defense attorney David Patton “argued that the government should be barred from prosecuting him for allegations he made in the context of a civil lawsuit, warning that it could discourage litigants from filing claims,” according to Vosizneias.

In addition, he said that the allegations made by the government do not constitute criminal fraud under federal law.

“They’re alleging that it’s simply a phony, sham litigation,” he said. “That’s not fraud.”

Justice Carter said the indictment was sufficient to move ahead, though he said he would consider Patton’s arguments at a later date if the case goes to trial.

Following the hearing, Ceglia promised to continue on with his claims against Facebook, while his civil attorney, Joseph Alioto, said they would prove the Zuckerberg contract is legitimate.

“Nothing is going to stop me,” Ceglia said.

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