Facebook

founder Mark Zuckerberg was keenly aware of the competitive threat he faced from two fellow Harvard students who were developing their own social network, according to emails a New York businessman claims he received from Zuckerberg in 2003.

Paul Ceglia's civil suit in federal court in New York includes a series of emails that he says he exchanged with Zuckerberg in which the two negotiated the terms of a partnership and discussed the development of a website called "The Face Book."

One exchange suggested that Zuckerberg was anxious to head off a rival effort from Cameron and Tyler Winklevoss before it could launch.

"I have recently met with a couple of upperclassmen here at Harvard that are planning to launch a site very similar to ours. If we don't make a move soon, I think we will lose the advantage we would have if we release before them. I've stalled them for the time being," Ceglia alleges Zuckerberg wrote.

Zuckerberg then asked Ceglia in the email for $1,000 "to get the site live" before the Winklevosses.

The identical twins and Olympic rowers, whose story provided the grist for the hit Hollywood film "The Social Network," have been relentlessly pursuing Zuckerberg in the courts without success.

Ceglia's purported revelations came on the same day a federal appeals court panel upheld a 2008 settlement that the Winklevosses are seeking to dissolve to get another shot at proving that they, not Zuckerberg, came up with the idea for Facebook. Their attorney Jerome Falk said Monday that they would ask the full panel of judges to review the case.

The Winklevosses say Facebook swindled them out of millions by not disclosing the true value of Facebook shares when they negotiated a settlement in 2008 in cash and stock. With the value of the privately held company's shares soaring, that settlement is now worth as much as $200 million.

Their allegations have dogged Zuckerberg for years as he built one of the world's most valuable and recognized Internet companies. Now Zuckerberg is wrestling with another person making claims to the billions in wealth he has created. Ceglia says he's entitled to as much as 50% of Zuckerberg's shares in Facebook, which has been valued at more than $50 billion.

Orin Snyder, an attorney with Gibson, Dunn & Crutcher who represents Facebook, called Ceglia "a scam artist" and his civil suit "fraudulent." The Palo Alto , Calif., company also contests the authenticity of the emails and the contract.

"The alleged emails are phony just like the alleged contract is bogus," Snyder said. "Facebook wasn't even a figment of Mark's imagination at the time in 2003 when this contract was allegedly dated and when some of these alleged emails were dated."

Facebook acknowledges that Zuckerberg did some programming work for Ceglia in 2003 to earn money while he was a freshman at Harvard. But the company denies that Zuckerberg gave Ceglia a stake in Facebook, which launched in 2004.

The company has questioned why Ceglia, who runs a wood-pellet business, took so long to make a claim. Unlike the Winklevosses and Facebook co-founder Eduardo Saverin, who also settled with Facebook, it took Ceglia years to pursue his claims against Zuckerberg.

Legal experts say Facebook is likely to challenge Ceglia, arguing that he did not file his claim before the statute of limitations ran out.

"It's absurd to think that this guy had these alleged rights and waited seven years to come out of the woodwork," Snyder said.

Ceglia says he had forgotten about the contract with Zuckberg until he discovered it in some old files. He was looking through the files after he was arrested and was being pursued for fraud by then-New York Atty. Gen. Andrew Cuomo , who was investigating his wood-pellet business, which had not delivered pellets to customers who had prepaid for them.

Ceglia originally filed a complaint last year claiming that he gave Zuckerberg money to develop a social networking site in exchange for an ownership stake. His claims were met with skepticism because of a checkered past including a conviction for hallucinogenic mushrooms in 1997 and the more recent fraud allegations involving his wood-pellet business.

But Ceglia amended his complaint on Monday, aided by lawyers from a major law firm. He was originally represented by a prominent Buffalo attorney, Terrence Connors, but recently switched to DLA Piper, an international law firm with several thousand lawyers.

The complaint "makes one pause since a serious law firm is involved," said Brooklyn Law School securities professor James Fanto.

His new attorney, Robert Brownlie of DLA Piper in San Diego , says his firm was initially skeptical of Ceglia's claims but after doing some homework became convinced they were genuine. Brownlie said he would not have risked DLA Piper's reputation if the emails were not authentic.

Ceglia has not produced the originals of the emails or the contract in court.

"The emails bolster the case and establish what Paul Ceglia has been saying all along, that this agreement between himself and Mark Zuckerberg as a matter of law created a general partnership," Brownlie said.

Legal experts say these kinds of disputes about the origins of companies are common.

"All forms of successful endeavors including successful companies are going to have people come out of the woodwork. Sometimes they have valid claims, many times they have nothing," said Eric Goldman, director of the High Tech Law Institute at Santa Clara University. "Either outcome is plausible here."

Ceglia claims Zuckerberg signed the contract in April 2003 when the Facebook chief executive was an 18-year-old freshman at Harvard. He said he met Zuckerberg in 2003 when he solicited bids for computer coding work for a company he was trying to get off the ground called StreetFax.

According to the copy of the contract Ceglia filed with the court, Ceglia agreed to pay Zuckerberg $1,000 to write computer code for StreetFax, a traffic data website. The alleged contract also mentions a $1,000 investment Ceglia made in a project called "The Face Book" and "The Page Book." In return the alleged contract gave Ceglia a 50% stake in the company, according to the complaint.

Facebook has acknowledged that Zuckerberg did sign a contract with Ceglia and that he worked for him, but has said he did not sign over any interest in Facebook.