I've read a lot of posts about Paper in the last few days. If you haven't, I would recommend this overview as well as FiftyThree's response to the kerfuffle. As of this morning, I haven't seen a response from Facebook.
As others have pointed out, Facebook has aggressively dropped lawsuits on many companies who dared to use a name ending in "-book". Now they are demonstrating the kind of copycat behavior they previously found so objectionable.
I don't think a legal remedy is likely here, nor would it result in a satisfying end thanks to Facebook's cash horde as compared to a small developer like FiftyThree. Instead of taking to the courts, I would like to see Apple step in on behalf of one of its most creative developers.
The recent 30th anniversary of the Mac provides an excellent opportunity for Apple to recall the not-too-distant past when a lack of third-party developer support contributed to a decade of poor results that nearly led the company to fold entirely.
It can be easy to forget about past mistakes and tough times when you're the most valuable company in the world, and that is exactly why Apple needs to take care of developers. Third-party software is what gives people a reason to keep using all that beautiful hardware designed by Apple in California. In the case of FiftyThree, they were among the first group of developers to unlock the potential of the iPad as a content creation device, rather than the consumption-only device many assumed it was.
What has Apple done for this visionary small developer? This week, they have featured Facebook's name-alike Paper in the top slot of "Best New Apps" on the iPhone App Store front page. To be clear, "Best New Apps" is curated by humans, not driven by algorithms like other lists on the App Store.
FiftyThree is small. Facebook is big. Apple is bigger. I would love Apple to flex their muscle on behalf of this small developer and get Facebook to own their mistake. I'll bet a younger Apple would have enjoyed that kind of support from a partner when Microsoft was throwing their weight around in the 1990's.