from BabagaNewz Magazine, Kislev 5768 / November 2007

Mark Zuckerberg launched Facebook from his Harvard dorm room in 2004. Today, it attracts more than 36 million users and is worth $10 billion. Three former colleagues from Harvard, however, have accused Zuckerberg of stealing the idea for Facebook and the computer code necessary to run it. In their lawsuit, the three ex-friends claim they hired Zuckerberg to write code for their web site, Harvard Connection, but he "never intended to provide the code and instead intended to breach his promise and steal the idea." Zuckerberg's lawyers deny the charge, saying, "Only one of the students had an idea significant enough to build a great company. That person was Mark Zuckerberg."

THE COMPLAINT
The charges against Zuckerberg include breach of contract and stealing trade secrets. According to the plaintiffs, Zuckerberg agreed in November 2003 to "complete all coding and technical aspects of the Harvard Connection website (HC) for an immediate December 2003 launch." Furthermore, they allege that Zuckerberg consented to become an equal partner and work without pay. This agreement, they say, led them to share confidential information with the defendant, which he used to launch a competitive web site in February 2004.

THE RESPONSE
Zuckerberg contends that he never signed a formal contract with HC; therefore, their lawsuit lacks merit. During a court hearing in July 2007, a federal judge agreed, saying, "Dorm room chitchat does not make a contract." The judge, however, did not dismiss the case; instead, he ordered the plaintiffs to provide more evidence to support their allegations.

UNDERSTANDING AMERICAN LAW
The case against Zuckerberg turns on two questions: Did HC have a valid contract with him? Did Zuckerberg have the right to use HC's trade secrets? Contract law demands that a valid contract, oral (though difficult to prove) or written, must include an offer, an acceptance of that offer, and a valuable consideration (a promise of payment). Plaintiffs argue that they have e-mail records proving there was a binding agreement. Zuckerberg says HC's so-called contract is "too vague and indefinite." Because the hi-tech industry depends on trade secrets, American law protects such information. Companies can require their employees to sign a non-compete covenant, which prevents them from taking company secrets to competitors. HC declares that Zuckerberg agreed to the confidentiality of his job. The defendant, however, wants this charge dismissed, due to lack of evidence.

THE JEWISH VIEW
The Jewish perspective on the Facebook faceoff requires an introduction to Judaism's approach to contracts and trade secrets. Generally, Jewish law does not recognize oral agreements. To avoid uncertainty, contracts must be accepted through a formal act called kinyan (acquisition). Although there are not always legal consequences for one who breaks an oral commitment in American or Jewish law, the Talmud considers such behavior a breach of faith and outlines a variety of moral sanctions: "God, who punished the generation of the flood, will exact payment from [those] who do not stand by [their] word" (Baba Metzia 4:2). Judaism strives to balance the needs and rights of employees and employers. Though the Talmud (Baba Kama 116b) acknowledges employee rights to work for whomever they choose ("The children of Israel are My servants, not the servants of other servants."), the Torah law (Devarim 19:14) that prohibited trespassing on a neighbor's land was expanded to include protecting intellectual property rights.