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EFiled: Jul 12 2024 10:52AM EDT
Transaction ID 73638979
Case No. 2018-0307-JTL
IN THE COURT OF CHANCERY IN THE STATE OF DELAWARE
CONSOLIDATED
C.A. No. 2018-0307-JTL
IN RE FACEBOOK, INC.
DERIVATIVE LITIGATION
NOTICE BY AARON GREENSPAN
OF CHALLENGE TO CONFIDENTIAL TREATMENT
Petitioner Aaron Greenspan operates PlainSite, a legal and financial research
website that makes millions of government documents accessible to the public online free of charge at https://www.plainsite.org.
Petitioner is also the initial creator, designer, and programmer of The
Facebook, originally known as The Universal Face Book, part of an integrated
student portal launched in September 2003 at Harvard College, of which Meta
Platforms, Inc. (the successor to Facebook, Inc., hereinafter “Facebook”) CEO
Mark Zuckerberg—at the time, Petitioner’s “friend” and classmate in a course
known as Computer Science 91r—was a member.1 As Mr. Zuckerberg developed
his own unlicensed copy of Petitioner’s website, leveraging source code for a
dating website he had been hired to write by Harvard students Cameron and Tyler
Winklevoss, Mr. Zuckerberg relied heavily on Petitioner’s database design,
1
See The New York Times, “Who Founded Facebook? A New Claim Emerges” by
John Markoff, September 1, 2007,
https://www.nytimes.com/2007/09/01/technology/01facebook.html.
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graphic design, user interface decisions, and written and verbal advice and
incorporated features developed by Petitioner without permission.2
On January 6, 2004, server logs indicate that Mr. Zuckerberg signed up for
Petitioner’s version of The Facebook and sent Petitioner an e-mail regarding “a
web app that would use the Harvard course catalog,” which he knew Petitioner’s
service already did. Mr. Zuckerberg expressed interest in meeting in person, but
stated that he was unavailable to meet on the evening of January 7, 2004 because
he would be “busy tomorrow night,” suggesting “Thursday” instead.
Unbeknownst to Petitioner, Mr. Zuckerberg was “busy tomorrow night,” January
7, 2004, because he was enlisting their classmate Eduardo Saverin to contribute
funds to Mr. Zuckerberg’s secret new business venture, which would depend in
part upon the unlicensed appropriation of Petitioner’s company’s intellectual
property. According to the First Amended Cross-Complaint of Eduardo Saverin
filed on October 5, 2006 in TheFacebook v. Saverin, Case No. 2005-1-CV-039867
(Sup. Ct. Santa Clara County), “On or about January 7, 2004, Saverin contributed
theFacebook’s initial capital—$1,000—to pay for server and domain name costs to
get the business up and running.”3,4
2
On June 2, 2004, Mr. Zuckerberg called Petitioner one of “only like six people in
the world who have decent ideas.”
3
See https://www.plainsite.org/dockets/download.html?id=261964474&z=7deb2fdf.
4
Mr. Zuckerberg knew that Petitioner’s company already had a co-located server
and funds to pay for business expenses, but deliberately omitted his need for such
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Petitioner did meet Mr. Zuckerberg for dinner that Thursday, January 8,
2004, where he also met Dustin Moskovitz and another student. Mr. Zuckerberg
and Petitioner discussed the fact that their respective projects—one, an already-live
student portal called houseSYSTEM that incorporated a feature marketed as The
Facebook,5 and the other, a website “on the d[own]-l[ow]” planning to make use of
“graph theory” which Petitioner correctly surmised would be a “Friendster for
Harvard”—appeared to have considerable overlap.6 Petitioner expressed his
significant concern that unless properly implemented, a website such as Mr.
Zuckerberg was describing would be a “privacy nightmare.” Mr. Zuckerberg,
having already secretly secured Saverin’s startup capital to incorporate a Limited
Liability Company, falsely informed Petitioner that he had no plans to start a
business, in order to reassure Petitioner that there would be no point in demanding
resources in his communications with Petitioner because Mr. Zuckerberg would
not have controlled the company had he simply agreed to work with Petitioner.
5
Other features on houseSYSTEM alongside The Facebook included configurable
privacy settings, configurable profile details including favorite quotes and AOL
Instant Messenger screennames, a digital event calendar with public RSVP
functionality and digital posters, birthday reminder e-mails, a message board, a
course scheduler, a marketplace for textbooks, products and services, and webbased e-mail access. Petitioner was still working on “Organizations,” which Mr.
Zuckerberg called “Groups,” when Mr. Zuckerberg’s version launched in 2004.
6
At 5:58 A.M. the same day, Mr. Zuckerberg had e-mailed Cameron Winklevoss
to stall for time on another project he was working on in parallel: Harvard
Connection, later renamed ConnectU, about which he did not inform Petitioner.
See ConnectU, Inc. v. Facebook, Inc. et al, Massachusetts District Court Case No.
1:07-cv-10593-DPW, ECF No. 68-31, available at
https://www.plainsite.org/dockets/download.html?id=23144533&a=31&z=0ba6e5a4.
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an ownership stake. Three days later, on January 11, 2004, Mr. Zuckerberg quietly
bought the domain name “thefacebook.com” without telling Petitioner and on
February 4, 2004, launched his website, thefacebook.com, mirroring several of the
features Petitioner developed on his original version of The Facebook, but with a
footer reading “a Mark Zuckerberg production” on the bottom of every page.7
Soon after launch, in a private conversation on AOL Instant Messenger (“AIM”),
Mr. Zuckerberg disparaged his users as “dumb fucks” who made the mistake of
“trust[ing] [him].” In another private AIM conversation, he also stated, “You can
be unethical and still be legal that’s the way I live my life haha.”
thefacebook.com grew quickly on Harvard’s campus thanks to repeated
endorsements by The Harvard Crimson, whose editors were fond of Mr.
Zuckerberg’s roommate and later co-founder, Christopher Hughes.8 Some students
amassed Facebook friend lists that numbered in the thousands. Petitioner was
outraged by Mr. Zuckerberg’s duplicitous behavior but, based on what Mr.
Zuckerberg had told him, was still unaware that any business had been
incorporated or that any funding had actually been raised. Mr. Zuckerberg
7
Mr. Zuckerberg also lied to the Harvard College Administrative Board, stating
via e-mail that he only began “making thefacebook” after meeting again with the
Winklevosses on January 14, 2004. Mr. Zuckerberg signed up for Petitioner’s
version of The Facebook on January 6, 2004, the same day he e-mailed Petitioner.
8
Unlike Petitioner, Mr. Hughes did not write a single line of code, but was given
stock in what ultimately became Facebook, Inc. and a title of “co-founder”
nonetheless.
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deliberately never told Petitioner that he had decided to incorporate a company
after all using Saverin’s startup capital, despite writing to Petitioner on AIM three
days before TheFacebook, LLC was incorporated in Florida, and using Petitioner’s
software the very next day and thereafter.
As the site grew, Petitioner was especially concerned that Mr. Zuckerberg,
who in their Computer Science 91r course had authored a software function for an
assignment with the vague name “do_stuff(),” and who had left the database
management tool phpMyAdmin exposed to the public on thefacebook.com’s cohosted server, was not being careful enough in his design of thefacebook.com.
Petitioner’s concerns were merited. On March 20, 2005, Petitioner alerted
Mr. Zuckerberg to the existence of a security vulnerability that Petitioner
discovered in thefacebook.com’s source code that would directly presage the
Cambridge Analytica scandal of 2018. Mr. Zuckerberg had added a feature to
thefacebook.com that allowed users to export lists of their friends, but once
exported, these lists were still available for any person to download, potentially
exposing individuals’ telephone numbers, e-mail addresses, physical addresses,
and dates of birth en masse. Knowing one user ID could lead to the disclosure of
thousands of records. Generally, the issue was known as the friend-of-a-friend
problem. Petitioner e-mailed Mr. Zuckerberg directly about the issue, who
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responded, “thanks, i didn't write that code but i’ll address the problem this
evening.”
The problem was not addressed that evening, or the next, or even a week
later. On April 7, 2005, Mr. Zuckerberg contacted Petitioner via AIM because in
response to Mr. Zuckerberg’s prolonged refusal to address the issue, Petitioner had
finally gone to the press. Mr. Zuckerberg stated that “publicizing it definitely
blows it out of proportion” and downplayed the problem, calling it “a minor flaw”
that was “pretty hard to exploit.” When Petitioner corrected Mr. Zuckerberg’s
understanding of the scope of the flaw, Mr. Zuckerberg responded, “weird.” Thus,
by 2018, Mr. Zuckerberg had personally been on notice of the underlying issues
involving the friend-of-a-friend problem for thirteen years. Petitioner also
corrected Mr. Zuckerberg’s flawed understanding of the law concerning privacy
breaches, warning him that “you could have opened yourself up to another lawsuit
had you left it open longer,” to which Mr. Zuckerberg responded, “not quite.”
Petitioner pushed back, providing advice that Mr. Zuckerberg would ignore at the
cost of $5 billion, regulatory action, and the instant lawsuit, among others: “oh
yes[,] very much so[:] FTC code section 5.” After Mr. Zuckerberg invited him to
test his Wirehog music and file sharing project, Petitioner further advised Mr.
Zuckerberg, who had grown bored of Facebook, to stop working on it due to the
risk of significant legal liability. Mr. Zuckerberg took this advice.
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On August 21, 2005, Petitioner attempted to convince Mr. Zuckerberg to
take a proactive approach against “spam” on The Facebook. Mr. Zuckerberg, who
was interested only in growth, responded, “i have issues with being too protective
in a competitive environment though” and “it also seems like the game becomes
that you have to get as many people in as quickly as possibe [sic] and not put
barriers in the way.” Even after his website boasted of hundreds of millions of
members, he never abandoned this mentality, viewing his leadership of the
company as a “game” whose sole and overriding goal was making the number of
user rows in the database go up.
In accordance with this goal, on September 26, 2006, Mr. Zuckerberg
fundamentally changed the nature of his website by converting it from a student
portal to a website for the general public, open to anyone at least 13 years of age.
At this point, the spam problem Petitioner had raised with Mr. Zuckerberg a year
before kicked into overdrive as Facebook performed virtually no authentication on
new users.
By 2008, it was clear that Mr. Zuckerberg had no intent of allowing
Petitioner to be involved with or share in the success of what was undeniably in
large part Petitioner’s own creation. Petitioner attempted to publish a memoir,
Authoritas: One Student’s Harvard Admissions and the Founding of the Facebook
Era, that discussed his recollection of the circumstances on campus at Harvard
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leading up to Facebook’s launch, including but not limited to the January 8, 2004
dinner.9 In short order, Petitioner was prohibited from advertising Authoritas using
Google AdWords because Google incorrectly asserted that trademark rights in the
term FACEBOOK (which appears in the subtitle) purportedly belonged to Mr.
Zuckerberg’s company.
On April 15, 2008, Petitioner consequently filed a trademark cancellation
petition regarding one of Facebook, Inc.’s FACEBOOK marks before the United
States Patent and Trademark Office Trademark Trial and Appeal Board (“TTAB”).
Aside from priority of use, one of the grounds in the cancellation was fraud against
the USPTO, as Facebook then-President Sean Parker had falsely represented under
penalty of perjury that the company knew of no other person who had used the
FACEBOOK mark prior.10
Petitioner filed a second trademark cancellation petition regarding another
FACEBOOK trademark before the TTAB on March 20, 2009. By May 2009,
Facebook, Inc. and Mr. Zuckerberg offered to settle the dispute with Petitioner,
just before a motion to compel may have forced the disclosure of embarrassing
documents and deposition testimony further proving that Mr. Zuckerberg did not
9
Petitioner’s knowledge of events at the time the book was published was
significantly limited by Mr. Zuckerberg’s deception.
10
Petitioner had spoken with both Mr. Parker and Mr. Zuckerberg by phone on
December 17, 2004 to inform them that he believed he had grounds to sue over Mr.
Zuckerberg’s wholesale appropriation of The Facebook.
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actually “invent” the product he is known for. On May 20, 2009, Petitioner
engaged in an all-day mediation session with Facebook, Inc. and Mr. Zuckerberg,
and the parties reached a general consensus regarding, among other issues, the
rehabilitation of Petitioner’s damaged reputation. Mr. Zuckerberg however, did
not sign until the morning of May 22, 2009—the Friday before Memorial Day
weekend—after a long-form agreement was circulated. The signed contract had
been sent by Cooley LLP attorney Michael Rhodes at 11:57 A.M. Yet Facebook
and Mr. Zuckerberg did not post the press release11 until late at night, forever
spoiling the opportunity to cure, or at least mitigate, the damage Mr. Zuckerberg
had done to Petitioner.12 Put another way, Facebook, Inc. and Mr. Zuckerberg not
only stole features from houseSYSTEM—they also stole the FACEBOOK
trademark rights from Petitioner by entering in bad faith into a settlement
agreement, which they knew they intended to violate immediately. The following
business day, Facebook announced a significant round of investment that the
11
See https://about.fb.com/news/2009/05/facebook-and-think-computercorporation-resolve-trademark-dispute/.
12
In addition to deliberately cutting Petitioner out of a founder role and ownership
stake in a company based on Petitioner’s work, Mr. Zuckerberg brazenly lied to an
auditorium full of students, faculty and investors at Stanford University on October
26, 2005, stating, “So, um, I did two years at Harvard. During my sophomore
year, I decided that Harvard needed a Facebook. It didn’t have one. So I made it.
That’s basically how it got started.” See
https://www.youtube.com/watch?time_continue=210&v=WA_ma359Meg. This is
but one of many reasons why Petitioner’s fact-based claims regarding Facebook’s
origins have typically been met with dismissal and ridicule.
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Paradise Papers revealed ultimately originated with Vladimir Putin and various
Kremlin-backed Russian oligarchs.13
By 2012, Facebook’s business model was proving unsustainable. On
October 26, 2012, Facebook vice president Sam Lessin—another of Petitioner’s
classmates who also attempted to compete with Petitioner’s houseSYSTEM
portal—wrote to Mr. Zuckerberg that the company was “running out of humans
(and [] out of valuable humans from an advertiser perspective).” Thus, just as the
company went public, fake accounts became one of Facebook’s most valuable
assets, helping to produce the illusion of perpetual growth. The overwhelming
number of fake accounts on Facebook also fueled division and democratic
instability, helping to elect Donald Trump, a Russian asset, President of the United
States in 2016.
In 2018, public sentiment regarding Facebook underwent a sea change after
news of the Cambridge Analytica scandal broke. Numerous lawsuits were filed,
including this one. The media fixated on the story, not realizing that the same
problem started to become an issue for The Facebook as early as 2005, and also
not realizing how intimately familiar Mr. Zuckerberg and Mr. Moskovitz were
with it. The media simultaneously failed to recognize the significance of the fake
13
See The New York Times, “Kremlin Cash Behind Billionaire’s Twitter and
Facebook Investments” by Jesse Drucker, November 5, 2017,
https://www.nytimes.com/2017/11/05/world/yuri-milner-facebook-twitter-russia.html.
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account problem: the spam that Petitioner had warned Mr. Zuckerberg about in
2005. Petitioner drafted a report about the problem using a combination of SEC
disclosures, extremely limited “transparency” data made public by Facebook, Inc.,
and educated guesses (the “PlainSite Report”), and published it in early 2019.14
Coverage of the PlainSite Report by the media was limited since Facebook’s
and Mr. Zuckerberg’s deliberate campaign to spin a founder narrative around Mr.
Zuckerberg and/or harm Petitioner’s reputation over the course of years had been
quite successful; many journalists viewed Petitioner as lacking any credibility or
objectivity.15 However, Facebook did respond to at least one journalist’s inquiry
about the report. On January 28, 2019, Business Insider reporter Isobel Asher
Hamilton wrote, “Facebook strongly denied the findings. ‘This is unequivocally
wrong and responsible reporting means reporting facts, even if it’s about fake
accounts,’ a Facebook spokeswoman told Business Insider. She did not give any
further explanation.”
On June 5, 2019, Petitioner testified about the PlainSite Report before the
British Parliament’s Digital, Culture, Media, and Sport Sub-Committee on
14
See https://www.plainsite.org/realitycheck/facebook.html.
Journalists were not alone in their skepticism. In 2006, Petitioner was denied a
lucrative job at Sequoia Capital—which he had already been told he had earned
after interviews—on the recommendation of Jim Goetz, then a new partner at
Sequoia who had joined from Accel Partners, which had just funded Facebook.
15
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Disinformation.16 Less than two months later, Donald Trump’s Federal Trade
Commission fined Facebook $5 billion, but allowed Mr. Zuckerberg to remain in
control of the company.
At the time in 2019, Petitioner lacked the necessary information to
determine whether the fake accounts model he had published in the PlainSite
Report was actually “unequivocally wrong” as the company claimed. Then, in late
2021, The Wall Street Journal published an investigation it entitled “The Facebook
Files,” based on documents leaked by Facebook whistleblower Frances Haugen.
Although the Journal alluded to the fake account problem in one article, it
withheld its source documents from public scrutiny, preventing Petitioner from
performing a detailed analysis. On April 27, 2023, Petitioner asked Journal
journalist Jeff Horwitz for permission to examine the Haugen files pertaining to
fake accounts. Petitioner’s request was denied.
Not until December 4, 2023 was Petitioner finally able to access the Haugen
files themselves, via the FBarchive website hosted by the Harvard Shorenstein
Center on Media, Politics and Public Policy that provided access to journalists only
starting in late 2023. Petitioner’s analysis of the Haugen files revealed that the
Journal reporting had glossed over numerous material revelations regarding the
fake account problem on Facebook, and that the PlainSite Report had been
16
See https://www.parliamentlive.tv/Event/Index/d434d37f-c020-44b4-bda8-11bbad29ac58.
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anything but “unequivocally wrong.” At this point, Petitioner realized that
Facebook had libeled him, fraudulently induced the settlement contract, and
breached the spirit, if not the letter, of its contract by deliberately working to
counter the effect of the negotiated press release that was intended to clear
Petitioner’s name—Petitioner’s primary goal in settling the dispute.
At the time of this document’s filing, Facebook has a market capitalization
of $1.4 trillion and Mr. Zuckerberg is one of the wealthiest people on the planet
with a net worth of approximately $180 billion. This incredible valuation makes
Facebook the largest corporate fraud in history, far surpassing the Bernard L.
Madoff Investment Securities, LLC Ponzi scheme and surpassing even Tesla, Inc.,
whose valuation, similarly based on false delivery metrics and false promises about
autonomous vehicles, peaked at $1.2 trillion in November 2021. Facebook’s
valuation is based on the false premise that, as even the Second Amended
Complaint in this lawsuit falsely alleges, “Facebook controls…the personal data of
over 2.8 billion people.” It does not, and it never has. There is a material
difference between people and user accounts, and the overwhelming majority of
the user accounts in Facebook’s database are fake or duplicate. The failure of
multiple regulators, Wall Street analysts, journalists, investors, and judges to
demand clarity and accountability on this key point—to the point where Facebook
no longer discloses any quarterly metrics about fake accounts at all in SEC
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filings because it feels no need to—has led to the rise of an out-of-control empire
built on overwhelming fraud, which in turn has, incredibly, led to a constitutional
crisis calling into question the continued viability of the United States of America
as a republic. That republic, which at this point arguably has ceased to exist—on
July 1, 2024, Supreme Court justices appointed by Russian asset and convicted
felon Donald Trump ended the American experiment, replacing the President with
a King—was victim to an unprecedented campaign of foreign influence led by
former KGB Director and Russian President Vladimir Putin and executed largely
via Facebook. But for Mark Zuckerberg and his perverse, derivative version of
Facebook—a version that built on Petitioner’s feature set while stripping it of
every safeguard Petitioner recommended, and a version which enabled Trump’s
rise, not to mention a genocide in Myanmar—this nightmarish state of affairs
would never have been possible.
On account of the fact that Petitioner sacrificed his ability to challenge Mark
Zuckerberg’s fraudulently-obtained ownership of Facebook, Inc. in court by
signing the 2009 settlement agreement which Facebook and Mr. Zuckerberg
entered into in bad faith and have now breached repeatedly, Petitioner anticipates
filing separate litigation in the near future challenging the validity of the settlement
agreement and Mr. Zuckerberg’s entire ownership stake, which is founded in
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fraud. In support of this litigation, Petitioner seeks as much information as
possible regarding Facebook and Mr. Zuckerberg’s duplicitous acts.
PLEASE TAKE NOTICE THAT, pursuant to Chancery Rule 5.1(g), Aaron
Greenspan hereby objects to the sealed filing and/or confidential designation of the
following documents in this action:
1. Document Number 84, filed November 8, 2018, and Attachments 2 and 8
(Public Version of Document Number 84 filed at Document Number 93);
2. Document Number 242, filed November 4, 2021, and Attachment 1
(Public Version of Document Number 242 filed at Document Number
248);
3. Document Number 264, filed April 1, 2022, and Attachments 2-3 (Public
Version of Document Number 264 filed at Document Number 265);
4. Document Number 270, filed May 23, 2022 (Public Version of
Document 270 filed at Document Number 271).
Just because information has been designated confidential or filed under seal
does not necessarily mean that it should be. Al Jazeera Am., LLC v. AT&T Servs.,
C.A. No. 8823-VCG, 2013 Del. Ch. LEXIS 248, at *10 (Ch. Oct. 14, 2013) (noting
the fact that information “previously undisclosed does not alone warrant
confidential treatment.”). Many of the redactions and confidential designations in
this case are part of an attempt to conceal criminal wrongdoing and serial
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violations of federal securities law. Furthermore, “Rule 5.1 makes clear that most
information presented to the Court should be made available to the public.” Id. at
*3 (quoting Delaware Court of Chancery, Protecting Public Access to the Courts:
Chancery Rule 5.1, at 1 (Jan. 1, 2013).
The words of Louis Brandeis are apt in this and every Chancery Rule 5.1(g)
situation. “Publicity is justly commended as a remedy for social and industrial
diseases. Sunlight is said to be the best of disinfectants; electric light the most
efficient policeman.” I urge the Court to recognize its public interest role, remove
all purported designations of confidentiality, and permit examination of the
aforementioned documents in this case.
Respectfully submitted,
Dated: July 11, 2024
Aaron Greenspan
956 Carolina Street
San Francisco, CA 94107-3337
Phone: +1 415 670 9350
Fax: +1 415 373 3959
E-Mail: aaron.greenspan@plainsite.org
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