ConnectU LLC v. Zuckerberg

On September 2, 2004, ConnectU LLC (plaintiff) sued Mark Zuckerberg and TheFacebook, Inc. (Facebook) (defendants). Zuckerberg and Facebook moved to dismiss for lack of subject-matter jurisdiction, arguing that diversity of jurisdiction was lacking because Zuckerberg and ConnectU were both New York citizens. Zuckerberg was born in New York and attended school there until his junior year, when he transferred to a school in New Hampshire. Zuckerberg then attended Harvard University in Massachusetts. In June 2004, after his sophomore year, Zuckerberg spent a few weeks at his family home in New York before moving to California to hang out with friends and work on Facebook. He took one bag of possessions and sublet a house with friends. Zuckerberg planned to return to Harvard in the fall and indeed left his belongings there. However, before the fall 2004 semester, Zuckerberg informed Harvard he would not return for the upcoming term. Harvard granted Zuckerberg a leave of absence, and at summer’s end, Zuckerberg retrieved his belongings and relocated them to New York. Facebook was incorporated in California on July 29, 2004. On August 8, Facebook entered a contract with Equinex, a California server facility, which Zuckerberg signed using his New York address. In late August or September, Facebook’s servers were relocated from New York to California. By mid-August, Zuckerberg believed that Facebook would receive about $550,000 in venture funding. However, as of September 2, no funds had been received, and Zuckerberg’s plan was to stay in California for a term or two, gauge Facebook’s progress, and return to Harvard. At that time, Facebook had fewer than 50 client schools. By mid-September, however, Facebook received its first venture funding and expanded to over 150 schools. Around mid-September, Zuckerberg left his summer sublease, spent a few days in New York, then returned to California, where he thereafter lived with friends in several unfurnished apartments around the San Francisco Bay Area. After leaving Harvard in summer 2004, Zuckerberg routinely used his New York address for permanent-address purposes, including leases and contracts. He also maintained New York bank accounts, credit cards, voter registration, and a driver’s license until 2006. Zuckerberg did not register and insure a vehicle in California until December 2004, nor did he purchase significant furniture or personal items there until at least summer 2005.