Facebook CEO gets served: Is Facebook at risk?

Mark Zuckerberg, CEO and founder of Facebook, has been served with legal papers while at a media lunch event in Idaho. Could this be the beginning of the end?

Updated (11th July 2010, 22:45 GMT): I spoke to a lawyer. Updated (12th July 2010, 19:52 GMT): Facebook PR got in touch. See below.

Mark Zuckerberg, CEO and founder of Facebook, has been served with legal papers while at a media lunch event in Sun Valley, Idaho yesterday according to the New York Post.

Major companies get sued and brought to court all the time, with it seemingly being an occupational hazard. But for a person to breach "tight security" at an event and hand over legal papers summoning a world leading CEO to court is something else.

At this point, nobody seems to know why he was served the subpoena - which under US law he must respond to - but some suggest it is privacy related. Facebook was unavailable for comment. It is the weekend, after all.

Facebook has been the center of privacy allegations and issues over the last year especially, with concerns being raised over data storage, security, the rights and intellectual property of users' data and uploaded content and the retention of which it is stored.

This does open up the question as to whether Facebook could be at risk. I briefly and almost-flippantly mentioned a couple of weeks back my view of the "demise of Facebook" and the only way the company could crumble. While most technology companies fight with each other to retain the top spot of hardware or software sales, Facebook is pretty much unstoppable.

For now, due legal process must take precedent and the chances of us mere mortal media types hearing anything until business hours tomorrow is unlikely.

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Update (1): I spoke to ZDNet blogger Denise Howell, a qualified lawyer in regards to this to try and get a better perspective of this issue. Frankly, she's awesome.

She pointed out that at this stage, there is little to go on and no clear idea who the defendants are. To personally serve Zuckerberg could force him testify at a trial or give a disposition deposition in a case where he or his company are not defendants. This could also be "personal", in that this may very well have nothing to do with Facebook.

It does seem quite likely that it may well be a private issue. If Facebook were to be sued, there would be more conventional channels to go through. By doing this, it raises awareness to the media and be seen as a publicity stunt. Also, by serving him directly could be an indication that more conventional means were in fact used, but Zuckerberg attempted to keep this quiet and as a result, this could be seen as a last resort.

Howell said:

"Long story short, the law specifies 'personal service' for things like a summons and complaint or a subpoena, but because the technique is invasive and can be inconvenient and expensive, it's not usually the first choice. Instead, the parties agree some other kind of service will suffice.

Service by ambush like this is something more the province of collection actions against deadbeats, not captains of industry in Sun Valley.  Seems like there's some kind of embarrassment-related agenda at work here perhaps."

In my personal opinion, I wouldn't be surprised if this was a private or personal matter, and for which it should be respected. However, if the running of his company could be brought into disrepute or difficulty which has a knock-on effect to the 400 million-plus users, that's an entirely different kettle of fish.

Update (2): Facebook UK's head of PR got in touch to state not only that the plaintiff appears to have  criminal history and currently under indictment (they seem to think these people or at least one is the plaintiff) and that the company had already been served the complaint before the 'publicity stunt' in Sun Valley.

Along with some off-record stuff, in short their official statement is:

"We believe this suit is completely frivolous and we will fight it vigorously".

Could this be the beginning of the end of the CEO, or even Facebook?