By Alexandra Burlacu | Nov 10, 2012 12:57 PM EST
Paul Ceglia, the entrepreneur recently charged with fraud after claiming to own half of Facebook, may end up paying Facebook's legal bill as well.
Authorities arrested Ceglia last month on fraud charges for allegedly fabricating evidence in his case against the social networking company. The entrepreneur posted a $250,000 bond and got out of jail on Friday, Nov. 9, determined to continue fighting his civil lawsuit against Facebook and co-founder Mark Zuckerberg.
It now appears, however, that instead of getting a big slice of the Facebook cash pie, Ceglia might actually have to pay for Facebook's attorneys and legal expenses in the case.
The case now revolves around why additional hard copies of an alleged contract between Ceglia and Zuckerberg were destroyed. Ceglia's attorneys have claimed that additional files were discarded as "waste paper" or "trash". Facebook, meanwhile, argued that Ceglia's explanation was "evasive" and "cryptic."
On Wednesday, Nov. 7, U.S. Magistrate Judge Leslie Foschio ordered Ceglia's legal team to submit a "affidavit confirming, in writing and under oath, that all hard-copies of the purported contract" Ceglia created before June 30, 2010, had been either turned over to Facebook or destroyed. The Judge also told the social networking giant to tally up a total of how much it spent on "costs and attorney's fees" in the case.
The battle started back in 2010, when Ceglia filed a lawsuit claiming that he had hired Zuckerberg in 2003 to write code for a project called StreetFax. According to Ceglia, he paid Zuckerberg $1,000 for coding work, and also invested $1,000 in Zuckerberg's "The Face Book" project. Ceglia claims that his $1,000 investment entitled him to a 50 percent interest in the multibillion dollar social network.
Recent conclusions in the trial have fired back at Ceglia. The entrepreneur now faces up to 40 years in prison for two charges relating to Ceglia's use of the U.S. Postal Service and email to transmit allegedly fraudulent materials.
Moreover, Manhattan U.S. Attorney Preet Bharara also alleged that Ceglia added a fabricated page into a contract signed by him and Zuckerberg to make it look like Zuckerberg had indeed promised him 50 percent ownership of the social networking company.
Judge Foschio, meanwhile, allowed Facebook last week to present a forensics report that concludes the purported "contract" entitling Ceglia to half ownership of Facebook was altered. Foschio said both sides have no more than 10 days to submit their affidavits.
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