Judge dismisses Ceglia lawsuit over ownership of Facebook

New York man claimed in a lawsuit against the social network and Mark Zuckerberg that he had a 2003 contract that entitled him to a half ownership in the company.

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Paul Ceglia Facebook profile photo Facebook

A federal judge has dismissed a lawsuit brought against Facebook and Mark Zuckerberg by a New York man who claimed to have a contract that entitled him to a half ownership in the social-networking giant.

US District Judge Richard J. Arcara on Tuesday granted Facebook's motion to dismiss Paul Ceglia's lawsuit, following the recommendation of another judge in the case who found there was clear evidence that alleged the 2003 contract submitted in the claim was a " recently created fabrication."

CNET has contacted Facebook and Ceglia attorney Paul Argentieri for comment and will update this report when we learn more.

In his 2010 lawsuit, Ceglia claimed that Zuckerberg entered into a contract with him in 2003 to design and develop the Web site that would ultimately become Facebook, after Ceglia hired Zuckerberg through a Craigslist ad to write code for a project called StreetFax and paid Zuckerberg $1,000 for coding work.

But Ceglia also presented a contract he claimed showed a $1,000 investment in Zuckerberg's The Face Book project that gave him a 50 percent interest in the company. Acknowledging that Zuckerberg signed a contract to work on StreetFax, Facebook initially said the contract was a "likely" forgery, later revising that assessment to call the document an " outright fabrication" and a " cut-and-paste job."

In his case, Ceglia cited more than a dozen emails, purportedly between himself and Zuckerberg that allegedly detailed discussions on design, development, business plans, and eventual contract disputes regarding The Face Book. However, in his recommendation to Arcaro a year ago, US Magistrate Judge Leslie G. Foschio said Ceglia's arguments consisted of "self-defeating inconsistencies, serving only to establish the fraudulent nature" of the contract and supporting emails.

Ceglia was arrested in Wellsville, N.Y., in October 2012 and charged with mail and wire fraud for allegedly doctoring the contract and creating fake emails related to the case. A judge in that case issued a separate ruling on Tuesday that denied his motion to dismiss those charges.