Facebook founders accused of project fraud and theft

    As promised, I publish here with a delay of several days some interesting materials from my blog about venture capital investments, venture capital investors and startups IdeaBlog.ru

    Most startups are worried as if someone had stolen their idea. And although the idea itself, as a rule, does not cost anything, a well-thought-out business model of a startup based on this idea, the monetization strategy of the project, its launch and promotion are the know-how of startups, and this information is any company - big or small, just starting he tries to protect his business or the existing one for a long time from prying eyes. I already wrote about whether investors can steal your idea, and how to choose an investor in order to prevent this situation.. The fact that you should protect your secrets from competitors existing in the market, working in the same niche as you, is clear to everyone. However, there are other ways to leak your confidential information, which can lead to the fact that someone starts to implement your project without you and starts earlier than you, and you, in the end, will remain out of business. I’m talking about the staff you hire, and I’ll look at this issue with a lawsuit filed against the founders of Facebook, which they accused of fraud and theft of the ideas of other startups, in whom Mark Zuckerberg, one of the founders of Facebook, worked as a programmer.

    On March 28, 2007, the Massachusetts Circuit Court filed a lawsuit from ConnectU, Inc against Facebook, Inc and its founders.Mark Zuckerberg (Mark Zuckerberg), Eduardo Saverin (Eduardo Saverin), Dustin Moskovits (Dustin Moskovitz), Andrew McCollum (Andrew McCollum) and Christopher Hughes (Christopher Hughes). The lawsuit is being tried by Judge Douglas Woodlock, who accuses defendants of violating copyright, disclosing trade secrets, violating a contract, violating trust, undeserved enrichment, dishonest business, fraud, and a number of other criminal acts. Plaintiffs - ConnectU, Inc. and its founders, Harvard University classmates, Cameron Winklevoss, Tyler Winklevoss, and Divia Narendra, who graduated from Harvard in 2004, claim that in December 2002 they started developing a business plan to create a new type of website, originally called Harvard Connection (harvardconnection.com ), and was later renamed ConnectU ( connectu.com) This site, according to the plan of its founders, was supposed to allow students and former pets of colleges and universities to create a social network with people studying in the same educational institution, and provide them with a place for meetings, exchange of information, discussion of job prospects and acquaintances. Initially, Harvardconnection.com's target audience was students and graduates of Harvard, but after the start of the Harvard social network, the founders of the startup also planned to reach other educational institutions. The ConnectU business model was built on advertising revenue, and, according to the founders, had a great chance of being financially successful, since site users - well-educated students and graduates - are the target audience of many advertisers.

    In November 2003, ConnectU founders hired Mark Zuckerberg to complete the development of the site’s software. Thus, Mark Zuckerberg gained access to the source codes in the form in which they existed at the end of 2003. The plaintiffs aimed to complete the development of the site as soon as possible so that they could launch it before June 2004 - i.e. until they graduate from university. Zuckerberg, according to the plaintiffs, repeatedly assured them that he would make all his knowledge and efforts to complete the development of software in the best possible way and in the shortest possible time. In addition to software development, Zuckerberg was also involved in startup business planning, interface development, refinement of ConnectU's business model, and planning for future site functionality.

    The combination of the project idea, its business model, software, interfaces and site functionality, which were kept secret and were not disclosed to third parties before the project was launched, thus constituted the commercial secret of the plaintiffs. Zuckerberg, according to the plaintiffs, was aware that all this data was their property and constituted a trade secret, therefore he undertook to keep confidential the information to which he had access. He also realized the importance of launching a project before the end of the school year and before any of the competitors launched a similar service for the success of the development of the project, since the one who first launched such a site received a significant advantage over competitors. Zuckerberg, as a reward for his work, was supposed, according to agreements with the plaintiffs,

    On January 8, 2004, Zuckerberg sent an email to Cameron Winklevoss, confirming that he would provide the complete software and a functioning website of the service in the very near future ( all e-mail messages, as well as other written or electronic documents mentioned here, were provided by the plaintiffs court ). 3 days later, on January 11, 2004, without fulfilling what he promised, Zuckerberg registered TheFacebook.com domain. At a meeting with the founders of harvardconnection.com on January 14, 2004, Zuckerberg did not tell them anything about thefacebook.com he planned.

    On February 4, 2004, Mark Zuckerberg, together with other defendants in this lawsuit, launched thefacebook.com, which was later renamed Facebook.com. Site concept, interfaces, functionality, etc. precisely repeated what the plaintiffs developed for their project. Zuckerberg told the press that he created and launched this site, spending a week on it. However, until the launch of thefacebook.com, Zuckerberg did not say anything to ConnectU founders that he was leaving the project.

    The founders of ConnectU, of course, were very surprised at the appearance of thefacebook.com by a developer who did not stop working on their team. They hired other programmers who completed the development of the site’s software and started on May 21, 2004, almost 4 months after the launch of TheFacebook.com, but time was lost.

    February 12, 2004, 8 days after the launch of TheFacebook.com, in his email sent to Cameron Winklevoss, Mark Zuckerberg wrote: “At the very beginning of the project ( harvardconnection.com - IdeaBlog.ru) interested me when you asked me to finish developing software for it. I did it ... ... I worked with the hope that I would be involved in the development and control of the project’s business, but found that you demanded that I devote my time to it, without really considering me as a co-founder of the project ... ”

    Pretty sad history, right?

    This article on the IdeaBlog.ru blog is here .

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