Facebook’s Impending Lawsuit
by
on July 16, 2007,
A long debate over how Facebook began is continuing in court, as the founders of social community ConnectU, continue their ongoing lawsuit against Mark Zuckerberg, the 23-year-old founder of Facebook. Apparently, before he created Facebook, Mark Zuckerberg worked with a few friends on a project called HarvardConnect.com that also was attempting to connect college students and alumni.
Zuckerberg ended up leaving that project, and eventually released Facebook, and the rest is history, with his Facebook touted to be worth more than $1 billion.Brothers Cameron and Tyler Winklevoss have accused Facebook's CEO of stealing the source code, design, and business plan for Facebook in 2003 when he briefly worked in the Harvard dorms as a programmer, which led to their lawsuit against him three years ago. Now, they have changed their company’s name to ConnectU, and the turmoil continues.
In fact, the ConnectU founders go on to suggest that Facebook be shut down and that full control of the site, and its profits be turned over to them. Facebook has denied these allegations, and Mark Zuckerberg has even filed another suit against ConnectU claiming unfair business practices and business torts. It makes you wonder who is telling the truth?
Zuckerberg has publicly stated that he was "intrigued" by ConnectU, but found that he was "subjected to demands on my time without truly being made a part of the development team." Even still, the case hasn’t gone away, and now that Facebook's worth has increased, there is a lot more to be lost if the allegations are true. VentureBeat believes that the worst case scenario for Facebook is that Zuckerberg and his investors will agree to settle this for many millions of dollars.
Whether he stole code or not, we know that Zuckerberg was, in fact, associated with the ConnectU founders before he started Facebook. What code, if any, did he write for them? Also, were there legal and binding contract involved between the friends or was it a lot of oral agreements to go into business together? What do you think? Is Facebook's future doomed?
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Michael Fidler 
It’s a tough call. A lot of code is covered under copyright code, but where does jurisdiction fall? If you don’t release the code, copyright really isn’t an issue, and who actually WROTE the code? It’s one thing if he stole code, but another if he took his own code with him and extended it. This is a messy suit that may set a lot of precedents for the programming industry, and that could have much more far-reaching effects than simply Facebook.
Under what laws are they suing him? Do they have a patent on some technology or business practice?
Unless Facebook published the code somewhere (highly unlikely) then how does the copyright part of the suit hold up?
“Misappropriation of trade secrets” sounds possible, but very difficult to prove, especially if, like most college dorms, things were pretty open and loose, which would undermine the “trade secret” part. I doubt breach of actual or implied contracts will hold up under scrutiny.
IANAL, but overall it sounds like they’ve some ethical complaints that don’t translate well to legal complaints, but I’d bet they’ll get bought off. If this goes to trial, I would hope it gets thrown out. If this is the level of legal hurdle that has to be cleared for a succesful suit, basically every business can and will be sued.
Copyright extends from the moment of “fixation” not publication for all works in or after 1978. However, copyright in factual and functional works like computer code is very “thin”, often providing little protection beyond literal misappropriation. Otherwise, it would be very difficult to create new computer programs, which by their very nature perform certain functions found in other programs and will likely have similar portions of code. So unless their was actual code appropriated, it is unlikely a copyright suit will stand. Also, in a fast-growing project, the actual code will be rewritten or entirely replaced as the site adds new features and new users. So even if there was literal code infringement at one time, there probably is not at this time. In that situation, damages would be more appropriate than an injunction that shut down the site.
For trade secrets, it’s not clear if there are any to begin with. To be a trade secret, the subject matter must derive independent value from being secret and reasonable means must be used to keep it a secret. Typical examples are secret formulas and algorigthms, and customer lists. A business idea, like starting a social networking site, usually does not qualify. Other groups had already started similar sites at that time, and college facebooks in both paper and online form already existed. The underlying computer code also may not necessarily have had any trade secrets. Code that added and retrieved the facebook entries from a database would involve direct applications of standard programming knowledge, not necessarily any secret algorithms. Rather it would receive the “thin” protection from copyright law that prevented direct copying of code.
In summary, unless there was direct misappropriation of computer code, Facebook will probably be successful in their defense, although it may take a long and expensive factual inquiry to sort the case out.
Finally, it should be noted that many businesses start out of ideas and discussions friends and classmates have about topics that are of interest to them, especially in a collaborative/social college environment. If there was no literal infringement or misappropriation of code or other materials, and the plaintiffs still succeed, it could have a chilling effect on the type of informal, collaborative discussions that often take place on college campuses and give rise to new businesses.