Facebook Recovers $340,000 From Accused Ad Thief
Marisa Kendall, The Recorder
February 19, 2015
SAN FRANCISCO — Facebook Inc. lawyers extracted less retribution than they hoped for Thursday from an accused scammer they say cost the company hundreds of thousands of dollars.
A Perkins Coie team argued Martin Grunin, dubbed the Baby Faced Wolf of Wall Street by a New York tabloid, should pay more than $1.3 million for impersonating legitimate advertising companies to open Facebook ad accounts.
U.S. District Judge William Alsup slashed that request in an order Thursday, awarding $340,000, plus $75,000 in attorney fees.The award corresponds to the losses Facebook says it suffered as a result of Grunin's alleged scam, but rejects the company's bid for an extra $500,000 in punitive damages, which Alsup called "grossly excessive."
Facebook's lawyers don't know how much money Grunin made from the alleged scam, or how much it will take to keep him from doing it again, Alsup wrote, making punitive damages inappropriate.
Facebook's lawyers claim Grunin sold his fraudulent Facebook accounts to people who had been banned from the social media site, didn't have adequate credit, or didn't intend to pay Facebook for the ads. Facebook disabled at least 70 of Grunin's accounts since 2011, according to the complaint filed in May in the Northern District of California.
Alsup granted Facebook default judgment in January after Grunin failed to properly respond to the company's pleadings.
The judge did not seem sympathetic to Grunin in Thursday's order, writing the defendant failed to comply with court rules and instead "chose to lard the record with bogus filings." Grunin, who terminated his lawyers in December, had submitted a series of perplexing filings, including a declaration claiming he had the rights to the phrase "MARTIN GRUNIN," a notice charging Facebook $300,000 for filing a motion, and another saying Facebook had to pay him $100,000 to enter into a "contractual relationship."
But Alsup also said Facebook's lawyers had submitted an "inadequately supported" request for roughly $325,000 in attorney fees and costs. He faulted counsel for providing no time sheets or invoices, and wrote it was a close call whether to "outright deny" the fee request.