July 20, 2007 — -- A federal judge will consider next week whether to throw out a lawsuit that accuses Facebook.com founder Mark Zuckerberg of stealing the idea for the popular social networking site from three of his former Harvard classmates.
The lawsuit, originally filed in 2004, claims that Zuckerberg stole the idea, the source code and the business plan for Facebook in 2003 while working as a programmer for three former Harvard students, who were developing their own social networking site, now called ConnectU.com.
The July 25 hearing comes amid widespread speculation that there may be another top-dollar bid for Facebook, which reportedly rejected a nearly $1 billion buyout offer from Yahoo! last year. Facebook had nearly 28 million unique visitors as of June, up from 14 million in September, according to ComScore.
The 23-year-old Zuckerberg has said publicly that he plans to keep the company private. But, the lawsuit, if it survives the motion to dismiss, could disrupt any potential sale or initial public offering, because buyers or investors may be reluctant to get involved with a company facing ongoing litigation, analysts said.
That reluctance could create pressure to settle the case, said Eric Goldman, academic director of the High Tech Law Institute at Santa Clara University. "A good reason to settle is because you want to present a clean company to a potential buyer," he said.
Douglas McIntyre, editor of 24/7 Wall St., a financial news and opinion Web site, said, "Having a pending lawsuit that says the source code doesn't belong to the company makes it virtually impossible to do anything."
"This makes it imperative that they get the thing resolved," said McIntyre. "It's gone from a dirty, little secret to being, in the tech world, front-page news. It's clearly poisoned the well."
ConnectU's founders, Cameron and Tyler Winklevoss and Divya Narendra, are asking for unspecified damages, including any profits that Zuckerberg made from using their ideas and they are asking to have control of Facebook turned over to them.
"Facebook would not exist if not for [the] fact that he obtained our clients' source code, worked on our clients' Web site and got the idea of creating his own site, without telling them," said ConnectU lawyer John Hornick.
A Facebook spokeswoman said the company did not comment on pending litigation.
In court papers, though, the company defended itself, saying, "Only one of [the students] had an idea significant enough to build a great company. That one person was Mark Zuckerberg." Zuckerberg and his business partners, who are also defendants in the suit, have moved to dismiss the case.
The lawsuit alleges a variety of legal claims, including copyright infringement, stealing trade secrets, fraud and breach of contract. According to the complaint, the Winklevosses and Narendra hired Zuckerberg in 2003 to help develop ConnectU, then known as Harvard Connection, and gave him access to the source code and their business plans.
Without telling the Winklevosses, Zuckerberg registered thefacebook.com on Jan. 11, 2004, three days after sending them an e-mail promising to deliver a "functioning Web site" for Harvard Connection, court papers say. Zuckerberg launched Facebook Feb. 4.
"We know he was working on his Web site while he was working on our clients' Web site," Hornick said. "There's no evidence that he had this idea before he met our clients."
ConnectU launched in May 2004, and has struggled to compete with the far more popular Facebook. The Winklevosses and Narendra sued Facebook in September 2004. The case was dismissed on technical grounds earlier this year, but ConnectU's lawyers promptly filed another lawsuit.
The costly legal battle began three years ago, before Facebook exploded in popularity and value, and it is not clear how much money the plaintiffs will get if they win, said Goldman.
He said strength of ConnectU's claims would depend on how a jury decides the particular facts of the case.
Though the possibility of selling Facebook may create pressure to settle the case, the time and expense that has already gone into the lawsuit suggests that it may be about more than money, Goldman said.
"Given how much has been spent, this could be more of an emotional concern, someone feeling like they've been jilted," he said.
Hornick, the ConnectU attorney, said, "The only way [to settle] is if they make an offer large enough to make my client happy, and I don't know what that amount will be."
When the lawsuit was originally filed, "The idea was that it would quietly go away," said Noah Kagan, who left Facebook last year and who says he knows Zuckerberg and the Winklevosses. "Facebook is now going to have to address it."
FAQs
Winklevoss and his brother are known for co-founding HarvardConnection (later renamed ConnectU) along with Harvard classmate Divya Narendra. In 2004, the Winklevoss brothers sued Facebook founder Mark Zuckerberg, claiming he stole their ConnectU idea to create the popular social networking site Facebook.
Did Mark Zuckerberg betray Eduardo Saverin? ›
Facebook co-founder, Eduardo Saverin, no longer works at Facebook. He hasn't since 2005, when CEO Mark Zuckerberg diluted Saverin's stake in Facebook and then booted him from the company. Saverin's exit from Facebook was the central plot of "The Social Network."
How much did Divya Narendra get from Facebook? ›
Back in 2004, Divya Narendra and the Winklevoss twins took Mark Zuckerberg to court for alleged intellectual property infringement, eventually walking away with a cash/stock settlement now estimated to be worth well over $100 million following Facebook's IPO.
Why did Eduardo sue Mark? ›
The only close friend of Mark Zuckerberg before Facebook was Eduardo. Eduardo had sued Mark for diluting his shares in Facebook. So Mark's lawyers were looking for arguments against Eduardo which supports the fact that his actions jeopardized the company.
How much is Tyler Winklevoss worth? ›
Who sued Mark for Facebook? ›
Racine today sued Facebook CEO Mark Zuckerberg for directly participating in decision-making that allowed the Cambridge Analytica data breach – the largest consumer privacy scandal in the nation's history – while Facebook misled users with claims of privacy and data protection.
Who owns 100% of Facebook? ›
Mark Zuckerberg is the largest shareholder in the company. Zuckerberg retains ownership and control of the company. Like Google, Facebook has issued two common stocks, Class A and Class B.
How much did Zuckerberg pay the twins? ›
The Winklevoss twins received some $65 million in cash and Facebook stock in the 2008 settlement over the creation of the social media giant.
How much money did Mark Zuckerberg pay the twins? ›
Facebook settlement (2008): The twins reach a settlement with Zuckerberg for $65 million in a mix of Facebook shares and cash. They claimed he copied their idea and some of the code they'd paid him to create.
Was Eduardo in love with Mark? ›
Relationship Interpretation
Some like to interpret that Eduardo knowingly was in love with Mark all along, since he plays the emotion to Mark's logic, and the impact of the hurt he expresses throughout the depositions is a message of sorts for how much Eduardo had loved him.
Is Sean Parker still a part of Facebook? ›
Parker was forced to step down as Facebook president in 2005 after an arrest for drug possession in North Carolina. He retained a minority stake in Facebook that was worth hundreds of millions of dollars and continued to be informally involved with the company. What is this?
How much money did Eduardo get? ›
How Much was Eduardo Severin's Stake in Facebook Worth? As of February 2023, Eduardo's stake in Facebook is worth $9 billion.
What is 0.03 of Facebook worth? ›
Facebook is worth $350B, so $100M is only 0.03% equity.
How much of the social network is true? ›
The movie isn't terribly accurate (and Sorkin won't argue)
Given that The Social Network isn't just based on a true story but on a relatively recent true story, it's not surprising that a lot of people were combing through the film to assess the accuracy.
Who owns the most Bitcoin? ›
The largest holder of Bitcoin is believed to be Satoshi Nakamoto, the pseudonymous founder of Bitcoin. Nakamoto is estimated to own approximately 1,000,000 BTC, worth around $27.13 billion.
Who owns the most Bitcoin a single person has? ›
Who owns the most bitcoin: Meet the whales. According to bitcoin-focused asset manager River Financial, Satoshi Nakamoto is estimated to be the biggest bitcoin holder in possession of more than one million BTC stored in roughly 22,000 addresses.
How many Bitcoin billionaires exist? ›
There are also likely a handful of anonymous Bitcoin billionaires out there; as of January 2021, there are 25 individual Bitcoin addresses holding more than a billion dollars, according to BitInfoCharts. Of those, five belong to crypto exchanges: CoinCheck, Bittrex, Binance, Bitfinex and Huobi.
Can you still get money from Facebook lawsuit? ›
The criteria is pretty simple: “If you were a Facebook user in the United States between May 24, 2007, and December 22, 2022, inclusive, you may be eligible for a cash payment,” the settlement details state. Claims can be submitted online or by mail through Aug. 25, 2023, and the process is fairly quick and simple.
Is the Facebook settlement claim legit? ›
To answer Glenn's first question, yes, the settlement is legit. It stems from multiple lawsuits that were brought against Facebook by users who claim the company improperly shared their data with third parties like advertisers and data firms.
Facebook's $725M settlement is huge, but how much will you actually get? (NEXSTAR) – Meta has agreed to pay a whopping $725 million sum to settle a class action lawsuit alleging Facebook shared its users' data without them knowing.
How much money did Winklevoss twins get from Facebook? ›
The Winklevoss twins received some $65 million in cash and Facebook stock in the 2008 settlement over the creation of the social media giant.
What influenced Mark to start Facebook? ›
Inspired by a comment on his previous social website attempt — “Facemash” — Mark Zuckerberg along with fellow Harvard mates, Eduardo Saverin, Andrew McCollum, Dustin Moskovitz and Chris Hughes founded Facebook.
What was the real reason Mark Zuckerberg made Facebook? ›
In 2006, Zuckerberg told NBC's “The Today Show” that he started Facebook because he “just figured it would be really cool if there was some website that I could go to that would tell me a bunch of information about my friends and the people around me.”
What did Mark said about Facebook? ›
“The argument that we deliberately push content that makes people angry for profit is deeply illogical,” Zuckerberg said in the memo, which he also posted on his public Facebook page. “We make money from ads, and advertisers consistently tell us they don't want their ads next to harmful or angry content.
Are the Winklevoss twins still billionaires? ›
Tyler and Cameron Winklevoss compete on day one of the Beijing 2008 Olympic Games, Aug. 9. By late 2021, Gemini was on fire and crypto prices were soaring to new record highs each day, leaving the identical twins with a combined net worth of over $7 billion.
Who is the richest bitcoin owner? ›
Crypto's richest person, Binance founder and CEO “CZ” is the 19th richest person in the world. Forbes estimates that he owns at least 70% of Binance, the leading global platform for crypto trading.
Who won the Facebook lawsuit Winklevoss? ›
Ultimately, the twins and their lawyers reached a compromise; the twins would take $20 million in cash and the rest of the $65 million settlement in stock. Quinn Emanuel would take its fee, about $13 million, in cash.
What does Mark Zuckerberg do with his money? ›
Zuckerberg invests in startups, real estate, and causes through the Chan Zuckerberg Initiative. Mark's personal investments focus on cause-driven projects, while Meta Platforms acquires potential rivals. He has a $320 million real estate portfolio with properties in Palo Alto, San Francisco, Lake Tahoe, and Hawaii.
What percentage of Facebook does Mark own? ›
The majority shareholder at Facebook is Mark Zuckerberg, the founder, and CEO of the company. Zuckerberg currently holds 13.6% of the company's shares, making him the single largest individual shareholder at Facebook.
One factor that we are aware of is the need to avoid certain trigger words that appear to result in reach being choked. Typical examples are words like “Free”, “Like”, “Share”, “Buy”, “Sale” are obvious reach killers. Facebook dislikes brands trying to force reach (“Like” and “Share” being obvious examples).
How long did it take Zuckerberg to code Facebook? ›
How long did it take to create Facebook? According to Zuckerberg's interview with Business Insider in 2016, it took him only two weeks to develop the initial version of Facebook — just two weeks to build a platform that would later host billions of users around the world and dominate the internet.
What was Mark Zuckerberg's original idea? ›
Mark Zuckerberg, the company's wunderkind CEO, has said that the social network was his own creation, something he designed and built while he was a student at Harvard.
What was Mark Zuckerberg's motivation for creating Facebook and how did it impact his relationships with others? ›
Vision and Motivation
According to Mark Zuckerberg himself, his idea behind Facebook was to create a social network on which student can talk with each other and it is secured. Further he wants that his vision should be expand and people all over the world can talk with each other.
How did Meta decide who to lay off? ›
According to the Information, Meta's vice president of remote presence Maher Saba told managers to identify people on their team who "need support" and "move to exit" poor performers "who are unable to get on track." The Washington Post reported that white-collar tech workers are worried about being placed on ...
Why is Meta laying off people? ›
Meta has said the layoffs are part of its “year of efficiency,” as the company attempts to engineer a turnaround following repeated revenue declines, heightened competition, concerns about user growth and big losses in its Reality Labs division amid its pivot to building the so-called metaverse.
What is the famous quote by Mark Zuckerberg? ›
"The biggest risk is not taking any risk in a world that is changing really quickly, the only strategy that is guaranteed to fail is not taking risks."
