Megaupload Ltd was a
Hong Kong
Hong Kong ( (US) or (UK); , ), officially the Hong Kong Special Administrative Region of the People's Republic of China (abbr. Hong Kong SAR or HKSAR), is a city and special administrative region of China on the eastern Pearl River Delta i ...
-based online company established in 2005 that operated from 2005 to 2012 providing
online services related to file storage and viewing.
On 19 January 2012, the
United States Department of Justice
The United States Department of Justice (DOJ), also known as the Justice Department, is a federal executive department of the United States government tasked with the enforcement of federal law and administration of justice in the United Stat ...
seized the domain names and closed down the sites associated with Megaupload after the owners were arrested and indicted for allegedly operating as an organization dedicated to
copyright infringement
Copyright infringement (at times referred to as piracy) is the use of works protected by copyright without permission for a usage where such permission is required, thereby infringing certain exclusive rights granted to the copyright holder, s ...
. Subsequently,
HK$
The Hong Kong dollar (, sign: HK$; code: HKD) is the official currency of the Hong Kong Special Administrative Region. It is subdivided into 100 cents or 1000 mils. The Hong Kong Monetary Authority is the monetary authority of Hong Kong and ...
330 million (approximately US$42 million) worth of assets were frozen by the
Customs and Excise Department of Hong Kong. The company's founder,
New Zealand
New Zealand ( mi, Aotearoa ) is an island country in the southwestern Pacific Ocean. It consists of two main landmasses—the North Island () and the South Island ()—and over 700 smaller islands. It is the sixth-largest island count ...
resident
Kim Dotcom
Kim Dotcom (born Kim Schmitz; 21 January 1974), also known as Kimble and Kim Tim Jim Vestor, is a German-Finnish Internet entrepreneur and political activist who resides in Glenorchy, New Zealand.
He first rose to fame in Germany in the 1990s ...
, has denied any wrongdoing, and the case against Dotcom has been the subject of controversy over its legality.
In 2017, a New Zealand judge ruled that Dotcom should be extradited to the United States, but Dotcom remained at liberty in New Zealand pending the results of an appeal. On 5 July 2018 the New Zealand court of appeal found Dotcom and three of his former colleagues were eligible to be extradited to the U.S. authorities. His lawyer said they would appeal to the New Zealand Supreme Court. The shutdown of Megaupload led to
denial-of-service (DoS) attacks on a range of websites belonging to the U.S. government and copyright organizations by the
hacktivist
In Internet activism, hacktivism, or hactivism (a portmanteau of '' hack'' and '' activism''), is the use of computer-based techniques such as hacking as a form of civil disobedience to promote a political agenda or social change. With roots in h ...
group
Anonymous.
On , Megaupload was re-launched as
Mega
Mega or MEGA may refer to:
Science
* mega-, a metric prefix denoting 106
* Mega (number), a certain very large integer in Steinhaus–Moser notation
* "mega-" a prefix meaning "large" that is used in taxonomy
* Gravity assist, for ''Moon-Eart ...
under the domain name mega.co.nz (later moved to mega.nz, and then to mega.io). The re-launch date was chosen to coincide with the one-year anniversary of Megaupload's takedown by the U.S.
Federal Bureau of Investigation
The Federal Bureau of Investigation (FBI) is the domestic intelligence and security service of the United States and its principal federal law enforcement agency. Operating under the jurisdiction of the United States Department of Justice, ...
.
Company and services
The company's registered office was on the 12th floor of the Shanghai Industrial Investment Building in Room 1204 in
Wan Chai
Wan Chai is situated at the western part of the Wan Chai District on the northern shore of Hong Kong Island, in Hong Kong. Its other boundaries are Canal Road to the east, Arsenal Street to the west and Bowen Road to the south. The area n ...
, Hong Kong.
The company web services included Megaupload.com, a
one-click hosting
A file-hosting service, cloud-storage service, online file-storage provider, or cyberlocker is an internet hosting service specifically designed to host user files. It allows users to upload files that could be accessed over the internet afte ...
service; Megapix.com, an
image hosting
{{internet hosting, right
An image hosting service allows individuals to upload images to an Internet website. The image host will then store the image onto its server, and show the individual different types of code to allow others to view that i ...
service; Megavideo.com and Megalive.com,
video hosting
An online video platform (OVP), provided by a video hosting service, enables users to upload, convert, store and play back video content on the Internet, often via a structured, large-scale system that may generate revenue. Users will generally u ...
services; and Megabox.com, a music hosting service. Other services included Megaclick, Megafund, Megakey and Megapay, all of which were advertisement and financial services. Along with this, four blogs were created including Megabest and Megaking. Two additional services—Megabackup and Megamovie—were in development before their closure.
Statistics
* Unique visitors: 82,764,913
* Page Views (in history): over 1,000,000,000
* Visitors per day: 50,000,000
* Reach: 4%
* Registered Members: 180,000,000
* Storage: 25
petabyte
The byte is a unit of digital information that most commonly consists of eight bits. Historically, the byte was the number of bits used to encode a single character of text in a computer and for this reason it is the smallest addressable uni ...
(25,000
terabyte
The byte is a unit of digital information that most commonly consists of eight bits. Historically, the byte was the number of bits used to encode a single character of text in a computer and for this reason it is the smallest addressable uni ...
)
* Once the 13th most visited site on the Internet
* According to
Sandvine
Sandvine Incorporated is an application and network intelligence company based in Waterloo, Ontario.
Sandvine markets network policy control products that are designed to implement broad network policies, including Internet censorship, congestion ...
, MegaUpload accounted for 1% of total traffic on
fixed access networks in North America.
* In a proceeding before the
High Court of New Zealand
The High Court of New Zealand ( mi, Te Kōti Matua o Aotearoa) is the superior court of New Zealand. It has general jurisdiction and responsibility, under the Senior Courts Act 2016, as well as the High Court Rules 2016, for the administration ...
on 2 February 2012, Kim Dotcom stated that Megaupload was "hosting 12 billion unique files for over 100 million users."
Software
Mega Manager
Megaupload also released its upload/download manager, Mega Manager, a
download manager
A download manager is a software tool that manages the downloading of files from the Internet, which may be built: into a Web browser
A web browser is application software for accessing websites. When a user requests a web page from a par ...
that featured a link-checker for Megaupload links as well as options to manage uploaded files, and to access the online control box that was on MegaUpload.
Megakey
Megakey was an
adware
Adware, often called advertising-supported software by its developers, is software that generates revenue for its developer by automatically generating online advertisements in the user interface of the software or on a screen presented to the ...
application which removed bandwidth limitations on Mega services during "happy hour" periods. In return, the users running Megakey agreed to supply some personal identification and
demographic data and to allow the substitution of ads on third party websites they visited with those of Megaupload.
Megabox
Megabox, a new form of media downloading site, was the first of its kind. Kim "Dotcom" described Megabox as "very similar to iTunes" except that it operated in a web browser using HTML5 technology and loaded "much faster than iTunes or anything else out there".
Filebox
FileBox was a
Flash applet that could be embedded onto any external webpage. It allowed users to upload content to Megaupload without having to visit the website itself or download the Mega Manager.
Reception
Unavailability
Although incorporated in Hong Kong, the company did not operate in Hong Kong. From 2009 onward, users with Hong Kong
IP address
An Internet Protocol address (IP address) is a numerical label such as that is connected to a computer network that uses the Internet Protocol for communication.. Updated by . An IP address serves two main functions: network interface ident ...
es were banned from accessing the site. The reason for the block was never disclosed by Megaupload, but Hong Kong Customs officials have suggested that the block was an attempt to hinder law enforcement investigation.
As of 23 May 2010, access to Megaupload was intermittently blocked by the internet authorities in Saudi Arabia by their regulator
Communications and Information Technology Commission
The Communications and Information Technology Commission (CITC; ar, هيئة الاتصالات وتقنية المعلومات, Hai'at al-Ittisalat wa Tiqniyyat al-Ma`lumat) is the Saudi communications authority. It was first established under ...
.
Megavideo was also intermittently blocked in the
United Arab Emirates
The United Arab Emirates (UAE; ar, اَلْإِمَارَات الْعَرَبِيَة الْمُتَحِدَة ), or simply the Emirates ( ar, الِْإمَارَات ), is a country in Western Asia ( The Middle East). It is located at t ...
due to pornographic content being accessible through the service.
From 9 June 2011 onward, the Malaysian government through
Malaysian Communications and Multimedia Commission
The Malaysian Communications and Multimedia Commission (Abbreviation: MCMC; ms, Suruhanjaya Komunikasi dan Multimedia Malaysia) is a regulatory body whose key role is the regulation of the communications and multimedia industry based on the po ...
ordered all ISPs in Malaysia to block Megaupload and Megavideo. Some ISPs reportedly blocked all the sites on the list while other ISPs throttled connection speeds.
In July 2011, access to Megaupload and Megavideo were blocked in
India
India, officially the Republic of India (Hindi: ), is a country in South Asia. It is the seventh-largest country by area, the second-most populous country, and the most populous democracy in the world. Bounded by the Indian Ocean on the so ...
for
Reliance Entertainment
Reliance Entertainment Pvt Ltd is an Indian media and entertainment company. It is a division of Reliance Group, handling its media and entertainment business, across content and distribution platforms. The company was founded on 15 February 20 ...
customers, after a court order was obtained, citing illegal copies of the 2011 film ''
Singham
''Singham'' is a 2011 Indian Hindi-language action film directed by Rohit Shetty and produced by Reliance Entertainment, based on a script by writers Yunus Sajawal and Farhad-Sajid. It serves as first installment of Shetty's Cop Universe. A ...
'' on file hosting sites.
On 19 January 2012, U.S. federal prosecutors in the state of
Virginia
Virginia, officially the Commonwealth of Virginia, is a state in the Mid-Atlantic and Southeastern regions of the United States, between the Atlantic Coast and the Appalachian Mountains. The geography and climate of the Commonwealth ar ...
shut Megaupload down and laid charges against its founder
Kim Dotcom
Kim Dotcom (born Kim Schmitz; 21 January 1974), also known as Kimble and Kim Tim Jim Vestor, is a German-Finnish Internet entrepreneur and political activist who resides in Glenorchy, New Zealand.
He first rose to fame in Germany in the 1990s ...
and others for allegedly breaching
copyright infringement
Copyright infringement (at times referred to as piracy) is the use of works protected by copyright without permission for a usage where such permission is required, thereby infringing certain exclusive rights granted to the copyright holder, s ...
laws.
For a short time after the closure of the site, users could access material via Google's
web cache
A Web cache (or HTTP cache) is a system for optimizing the World Wide Web. It is implemented both client-side and server-side. The caching of multimedias and other files can result in less overall delay when browsing the Web.
Parts of the sys ...
and
The Internet Archive
The Internet Archive is an American digital library with the stated mission of "universal access to all knowledge". It provides free public access to collections of digitized materials, including websites, software applications/games, music, ...
. One day after the indictment Google and Archive.org voluntarily removed the site mirrors to avoid the responsibility of hosting a website taken down for
copyright infringement
Copyright infringement (at times referred to as piracy) is the use of works protected by copyright without permission for a usage where such permission is required, thereby infringing certain exclusive rights granted to the copyright holder, s ...
.
Criticism
In January 2011,
MarkMonitor
MarkMonitor Inc. is an American software company founded in 1999. It develops software intended to protect corporate brands from Internet counterfeiting, fraud, piracy, and cybersquatting. It also develops and publishes reports on the prevalence ...
published a report entitled "Traffic Report: Online Piracy and Counterfeiting", which said that Megaupload and Megavideo were, along with
RapidShare
RapidShare was an online file hosting service that opened in 2002. In 2009, it was among the Internet's 20 most visited websites and claimed to have 10 petabytes of files uploaded by users with the ability to handle up to three million users si ...
, the top three websites classified as "digital piracy", with more than 21 billion visits per year. Megaupload responded by stating: "Activity that violates our terms of service or our acceptable use policy is not tolerated, and we go to great lengths to swiftly process legitimate
DMCA
The Digital Millennium Copyright Act (DMCA) is a 1998 United States copyright law that implements two 1996 treaties of the World Intellectual Property Organization (WIPO). It criminalizes production and dissemination of technology, devices, or ...
takedown notices". Mark Mulligan, an analyst at
Forrester Research, pointed out that the number of visits did not necessarily indicate the number of downloads of illegal material.
Megaupload Toolbar was said to redirect users to a custom error page when a
404 error occurred in the user's browser. It was also said to contain spyware. FBM Software said that the Megaupload toolbar is free of
spyware
Spyware (a portmanteau for spying software) is software with malicious behaviour that aims to gather information about a person or organization and send it to another entity in a way that harms the user—for example, by violating their priva ...
.
When a file was uploaded to Megaupload and another file with the same hash was already found to exist, the uploader would be asked if they would like to link to the already existing file. Therefore, a single file may have contained multiple links to it. This caused some controversy, since when a DMCA takedown notice was issued only the link that was provided was removed; not necessarily the file itself.
Megaupload song controversy
On 9 December 2011, Megaupload published a music video entitled "The Mega Song", showing artists including
Kanye West
Ye ( ; born Kanye Omari West ; June 8, 1977) is an American rapper, singer, songwriter, record producer, and fashion designer.
Born in Atlanta and raised in Chicago, West gained recognition as a producer for Roc-A-Fella Records in the ea ...
,
Alicia Keys
Alicia Augello Cook (born January 25, 1981), known professionally as Alicia Keys, is an American singer, songwriter, and pianist. A classically trained pianist, Keys started composing songs when she was 12 and was signed at 15 years old by Col ...
and
will.i.am
William James Adams Jr. (born March 15, 1975), known professionally as will.i.am (pronounced "Will-I-am"), is an American rapper, singer, songwriter and record producer. He is the founding and lead member of the musical group Black Eyed Peas.
...
endorsing the company.
Snoop Dogg appeared in earlier versions of the video.
The music video was also uploaded to YouTube, but was removed following a takedown request by the record company
Universal Music Group
Universal Music Group N.V. (often abbreviated as UMG and referred to as just Universal Music) is a Dutch– American multinational music corporation under Dutch law. UMG's corporate headquarters are located in Hilversum, Netherlands and its ...
(UMG). Megaupload said that the video contained no infringing content, commenting: "we have signed agreements with every featured artist for this campaign". Megaupload requested an apology from UMG, and filed a lawsuit against the company in the
United States District Court for the Northern District of California, on 12 December 2011. UMG denied that the takedown was ordered under the terms of the
Digital Millennium Copyright Act
The Digital Millennium Copyright Act (DMCA) is a 1998 United States copyright law that implements two 1996 treaties of the World Intellectual Property Organization (WIPO). It criminalizes production and dissemination of technology, devices, or ...
, and said that the takedown was "pursuant to the UMG-YouTube agreement," which gives UMG "the right to block or remove user-posted videos through YouTube's CMS (Content Management System) based on a number of contractually specified criteria." The video was subsequently returned to YouTube, with the reasons for the UMG takedown remaining unclear. YouTube stated: "Our partners do not have the right to take down videos from YT unless they own the rights to them or they are live performances controlled through exclusive agreements with their artists, which is why we reinstated it." Lawyers for
will.i.am
William James Adams Jr. (born March 15, 1975), known professionally as will.i.am (pronounced "Will-I-am"), is an American rapper, singer, songwriter and record producer. He is the founding and lead member of the musical group Black Eyed Peas.
...
initially said that he had never agreed to the project, but on 12 December, he denied any involvement in the takedown notice.
2012 indictments by the United States
![MegaUpload FBI-Banner](https://upload.wikimedia.org/wikipedia/commons/0/0b/MegaUpload_FBI-Banner.jpg)
On 19 January 2012 the
United States Department of Justice
The United States Department of Justice (DOJ), also known as the Justice Department, is a federal executive department of the United States government tasked with the enforcement of federal law and administration of justice in the United Stat ...
seized and shut down the file-hosting site Megaupload.com and commenced criminal cases against its owners and others. The lead prosecutor,
Neil MacBride, had formerly served as Vice President, Anti-Piracy and General Counsel, of the
Business Software Alliance
The Software Alliance, also known as BSA, is a trade group established by Microsoft in 1988 to represent commercial software makers. It is a member of the International Intellectual Property Alliance. Its principal activity is trying to stop cop ...
, where he oversaw global anti-piracy enforcement and copyright policy. On 20 January
Hong Kong Customs froze more than 300 million Hong Kong dollars (US$39 million) in assets belonging to the company.
Arrests in New Zealand
Acting upon a US Federal prosecutor's request, the
New Zealand Police arrested Dotcom and three other Megaupload executives in a leased $30 million mansion at
Coatesville near
Auckland
Auckland (pronounced ) ( mi, Tāmaki Makaurau) is a large metropolitan city in the North Island of New Zealand. The most populous urban area in the country and the fifth largest city in Oceania, Auckland has an urban population of about ...
on Friday, 20 January 2012 (
NZDT
Time in New Zealand is divided by law into two standard time zones. The main islands use New Zealand Standard Time (NZST), 12 hours in advance of Coordinated Universal Time (UTC) / military M (Mike), while the outlying Chatham Islands use Ch ...
, UTC+13). This was pursuant to a request from the U.S.
Federal Bureau of Investigation
The Federal Bureau of Investigation (FBI) is the domestic intelligence and security service of the United States and its principal federal law enforcement agency. Operating under the jurisdiction of the United States Department of Justice, ...
that the four be extradited for racketeering and money laundering. The raid was timed for the birthday celebration of Dotcom. Assets worth $17 million including art works and cars were seized. The four men arrested were
Kim Dotcom
Kim Dotcom (born Kim Schmitz; 21 January 1974), also known as Kimble and Kim Tim Jim Vestor, is a German-Finnish Internet entrepreneur and political activist who resides in Glenorchy, New Zealand.
He first rose to fame in Germany in the 1990s ...
(founder; 38 years old, from Germany), Finn Batato (CMO; 38, from Germany), Mathias Ortmann (CTO and co-founder; 40, from Germany) and Bram van der Kolk (29, from the Netherlands).
On 23 January, Dotcom appeared in Auckland's North Shore District Court for a bail hearing. The crown argued against bail on the basis that he was a flight risk with a helicopter on his front lawn, while defence lawyers argued that the helicopter could not fly far enough to reach another country. They also said that Dotcom denied any criminal wrongdoing. Judge David McNaughton expressed concern at the discovery of two shotguns at Dotcom's mansion during the police raid, and deferred a decision on whether to grant bail, saying that he needed more time to review the submissions. The request for bail was turned down, with Judge McNaughton saying that "he was denied due to the risk
hat
A hat is a head covering which is worn for various reasons, including protection against weather conditions, ceremonial reasons such as university graduation, religious reasons, safety, or as a fashion accessory. Hats which incorporate mecha ...
Mr. Dotcom would flee jurisdiction and the possibility that if he reached Germany he wouldn't be extradited to face the charges". On 3 February 2012, an appeal to the
High Court of New Zealand
The High Court of New Zealand ( mi, Te Kōti Matua o Aotearoa) is the superior court of New Zealand. It has general jurisdiction and responsibility, under the Senior Courts Act 2016, as well as the High Court Rules 2016, for the administration ...
upheld the decision to deny bail.
On 22 February 2012, North Shore District Court Judge Nevin Dawson overturned the previous rulings and granted bail to Kim Dotcom, saying that the risk of flight had diminished after his assets had been seized.
On 5 March 2012, a formal request for the
extradition
Extradition is an action wherein one jurisdiction delivers a person accused or convicted of committing a crime in another jurisdiction, over to the other's law enforcement. It is a cooperative law enforcement procedure between the two jurisdi ...
to the United States of Kim Dotcom and three other senior Megaupload staff was filed in a New Zealand court.
On 30 April 2012, the New Zealand High Court ruled that around $750,000 of Kim Dotcom's assets could be returned, including a
Mercedes-Benz G55 AMG and
Toyota Vellfire
The is a minivan produced by the Japanese automaker Toyota since 2002. It is available as a seven or eight-seater with petrol and hybrid engine options. Hybrid variants have been available since 2003, which incorporates Toyota's Hybrid Synergy ...
that had been seized during the raid on his home. The assets in 63 bank accounts and around thirty other vehicles remained in custody. A paperwork error by the New Zealand authorities meant that Kim Dotcom's property had been seized in January 2012 without giving proper notice. The restraining order on his property was granted in April 2012. During April 2012, US district court judge Liam O'Grady stated "I frankly don't know that we are ever going to have a trial in this matter," as he found out that the company had never been formally served with criminal papers by the US.
On 28 June 2012,
New Zealand High Court
The High Court of New Zealand ( mi, Te Kōti Matua o Aotearoa) is the superior court of New Zealand. It has general jurisdiction and responsibility, under the Senior Courts Act 2016, as well as the High Court Rules 2016, for the administration ...
judge Justice Helen Winkelmann ruled that the
search warrant
A search warrant is a court order that a magistrate or judge issues to authorize law enforcement officers to conduct a search of a person, location, or vehicle for evidence of a crime and to confiscate any evidence they find. In most countries, ...
s used to raid the home of Kim Dotcom were invalid, saying "The warrants did not adequately describe the offences to which they related. They were general warrants, and as such, are invalid."
On 10 July 2012, a decision on whether Kim Dotcom and other Megaupload employees should be extradited to the United States was delayed until March 2013, in order to allow further time for legal arguments to be heard. New Zealand judge Justice Helen Winklemann said that U.S. authorities would need to provide evidence of "Internet piracy" before Dotcom was extradited.
On 24 September 2012, New Zealand's Prime Minister
John Key
Sir John Phillip Key (born 9 August 1961) is a New Zealand retired politician who served as the 38th Prime Minister of New Zealand from 2008 to 2016 and as Leader of the New Zealand National Party from 2006 to 2016. After resigning from bo ...
ordered an inquiry into whether staff at the
Government Communications Security Bureau
The Government Communications Security Bureau (GCSB) ( mi, Te Tira Tiaki) is the public-service department of New Zealand charged with promoting New Zealand's national security by collecting and analysing information of an intelligence nature. ...
had unlawfully spied on Kim Dotcom and the other defendants in the case. Key commented "I expect our intelligence agencies to operate always within the law. Their operations depend on public trust."
On 7 July 2014, it was reported that the proceedings to
extradite
Extradition is an action wherein one jurisdiction delivers a person accused or convicted of committing a crime in another jurisdiction, over to the other's law enforcement. It is a cooperative law enforcement procedure between the two jurisdic ...
Dotcom from New Zealand to the USA had been delayed until February 2015.
On 8 September 2014, the Court of Appeal ruled that the New Zealand Police is to return seized electronic devices unencrypted back to Dotcom and those involved.
On 23 December 2015, New Zealand judge Nevin Dawson ruled that Kim Dotcom, as well as three of his colleagues, can be extradited to the United States to face copyright infringement charges. Mr. Dotcom's lawyers said they would appeal the decision.
Basis of indictment
![MegaUploadIndictment](https://upload.wikimedia.org/wikipedia/commons/5/57/MegaUploadIndictment.jpg)
The indictment
alleged that Megaupload differed from other online
file storage businesses.
Media reports covering the case highlighted several points from the indictment used to support claims of illegal activity. The indictment provided instances alleged to show criminal behaviour, as well as indicating design points of Megaupload's
operating model
An operating model is both an abstract and visual representation (model) of how an organization delivers value to its customers or beneficiaries as well as how an organization actually runs itself.
Definition
There are different ways of defining t ...
as being evidence of
criminal intent:
# In practice, the "vast majority" of users do not have any significant long term private storage capability. Continued storage is dependent upon regular downloads of the file occurring. Files that are infrequently accessed are rapidly removed in most cases, whereas popular downloaded files are retained. (items 7–8)
# Because only a small portion of users pay for storage, the business is dependent upon advertising. Adverts are primarily viewed when files are downloaded and the business model is therefore not based upon storage but upon maximizing downloads. (items 7–8)
# Persons indicted have "instructed individual users how to locate links to infringing content on the Mega Sites ...
nd... have also shared with each other comments from Mega Site users demonstrating that they have used or are attempting to use the Mega Sites to get infringing copies of copyrighted content." (item 13)
# Persons indicted, unlike the public, are not reliant upon links to stored files, but can search the internal database directly. It is said they have "searched the internal database for their associates and themselves so that they may directly access copyright-infringing content". (item 14)
# A comprehensive takedown method is in use to identify
child pornography
Child pornography (also called CP, child sexual abuse material, CSAM, child porn, or kiddie porn) is pornography that unlawfully exploits children for sexual stimulation. It may be produced with the direct involvement or sexual assault of a ...
, but not deployed to remove infringing content. (item 24)
# Infringing users did not have their accounts terminated, and the defendants "made no significant effort to identify users who were using the Mega Sites or services to infringe copyrights, to prevent the uploading of infringing copies of copyrighted materials, or to identify infringing copies of copyrighted works" (items 55–56)
# An incentive program was adopted encouraging the upload of "popular" files in return for payments to successful uploaders. (item 69e ''et al.'')
# Defendants explicitly discussed evasion and infringement issues, including an attempt to copy and upload the entire content of YouTube. (items 69i-l. YouTube: items 69 i,j,l,s)
Counter arguments advanced
Defense attorney Ira Rothken says that the raid was unjustly swift and did not give his client the opportunity to defend himself, quoting a similar case involving YouTube as an example of a completely different turnout.
Legal commentators point out that while the indictment may be correct and Megaupload might have acted as a criminal conspiracy as said, a number of points in the indictment are based upon selective interpretations and legal concepts (described in one article as "novel theories" of the law
) and could be challenged in court. A ''
Los Angeles Times
The ''Los Angeles Times'' (abbreviated as ''LA Times'') is a daily newspaper that started publishing in Los Angeles in 1881. Based in the LA-adjacent suburb of El Segundo since 2018, it is the sixth-largest newspaper by circulation in the U ...
'' analysis stated that the author was "struck by how far the indictment goes to find something nefarious";
likewise a
TechDirt
Techdirt is an American Internet blog that reports on technology's legal challenges and related business and economic policy issues, in context of the digital revolution. It focuses on intellectual property, patent, information privacy and c ...
analysis concluded that while the
founder of Megaupload had a significant history of "flounting the law", evidence has potentially been taken out of context or misrepresented and could "come back to haunt other online services who are providing perfectly legitimate services".
Both analyses concur that other evidence could show criminality; the concerns were not irrefutable. The legal concerns included:
:* Indictment cites lack of a site search as evidence supporting criminality, but in other copyright cases having a site search has been described as evidence in support of criminality and in ''
Atari v. RapidShare''
not having a site search was agreed by the court as evidence of responsible activity given that some infringing content might exist and be searched for if one existed.
In the case of ''
IsoHunt'', the ''presence'' of a search feature was interpreted as evidence of inducement.
TechDirt
Techdirt is an American Internet blog that reports on technology's legal challenges and related business and economic policy issues, in context of the digital revolution. It focuses on intellectual property, patent, information privacy and c ...
commented that "To use the lack of a feature, that previously was shown to be a problem, as evidence of a conspiracy is crazy. Damned if you do, damned if you don't."
:* The "top 100" list excluded copyrighted titles, but the indictment says this was evidence of concealing, rather than avoiding downloads of, infringing materials.
:* The indictment asserts as evidence that no effort was made to identify infringing files or users, in other words by acts of omission. But federal court rulings repeatedly agree that no duty exists to search these out.
In particular, in ''
MGM Studios, Inc. v. Grokster, Ltd.'' the Supreme Court looked at "substantial noninfringing uses"; mere lack of monitoring was not by itself sufficient to show wrongdoing or inducement.
It may not be possible (or reasonable to require) the host to know and identify what activity is legitimate or not, as file sharing may be used by many content creators.
:* Deletion after a limited period of non-download is suggested as evidence of a motive. But many legitimate sites such as
Imgur
Imgur ( , stylized as imgur) is an American online image sharing and image hosting service with a focus on social gossip that was founded by Alan Schaaf in 2009. The service has hosted viral images and meme, particularly those posted on Reddit ...
remove unused content after a while to free up server space. If files were routinely deleted after a short period it could equally suggest legitimate use - because it serves users who share legitimately for a short while, and enforces removal afterwards.
:* Much of the indictment, in the words of one analysis, "seems to be based on the simple assumption that encouraging more usage means they must be encouraging infringement", in other words there should be evidence of actual wrongdoing, not merely evidence of popular use. Many legitimate files are popular and popularly shared, and an assumption that paid use largely equates to infringing use would need evidence.
:* Failure to remove all links following a takedown request is often legitimate. For example the same content may be uploaded by legitimate and illegitimate users. Removing the infringing ''link'' does not affect legitimate uploaders. Removing the infringing ''file'' would wrongfully cause it to be deleted for legitimate users too.
Similarly, once child pornography is identified, it is ''always'' illegal for ''all'' users. But other material may be legal for some users and not for others. So the fact one case requires ''file'' removal and the other only requires ''link'' removal may well be correct conduct.
:* The indictment includes
money laundering charges. But these include "basic payments" for web hosting, suggesting "
lumping in"—adding matters that are in no way illegal to make a case look bad.
:* Megaupload had indicated willingness to attend court in the U.S. already, and answer civil cases.
Safe harbor provisions
The US
Digital Millennium Copyright Act
The Digital Millennium Copyright Act (DMCA) is a 1998 United States copyright law that implements two 1996 treaties of the World Intellectual Property Organization (WIPO). It criminalizes production and dissemination of technology, devices, or ...
provides
safe harbor for sites that promptly take down infringing content. Safe harbor does not exist if the site has
actual knowledge and does nothing about it. Moreover, the DMCA "safe harbor" is less important in criminal cases than civil cases because defeating the first element, lack of knowledge or awareness of infringement, may be easier for the prosecution than meeting the "willfulness" requirement for criminal copyright liability.
In Megaupload's case, the indictment alleges DMCA provisions were used for the appearance of legitimacy – the actual material was not removed, only some links to it were, takedowns agreement was approved based on business growth rather than infringement, and the parties themselves openly discussed their infringing activities. The indictment says that Megaupload executives:
... are willfully infringing copyrights themselves on these systems; have actual knowledge that the materials on their systems are infringing (or alternatively know facts or circumstances that would make infringing material apparent); receive a financial benefit directly attributable to copyright-infringing activity where the provider can control that activity; and have not removed, or disabled access to, known copyright infringing material from servers they control."
Prosecutors said in the indictment that Megaupload was not DMCA compliant, and cited the example of an alleged infringer on the site known as "VV." Over six years, VV had allegedly uploaded nearly 17,000 files to Megavideo.com, resulting in more than 334 million views. According to prosecutors, although numerous takedown e-mails had been sent, none of the files had been deleted.
In a television interview with
3 News
''Newshub'' (stylised as ''Newshub.'') is a New Zealand news service that airs on the television channels Three and Eden, as well as on digital platforms. It formerly operated across radio stations run by MediaWorks Radio until December 202 ...
, Kim Dotcom said he was not a "piracy king", and said that Megaupload had applied the provisions of the DMCA and went beyond it, by giving copyright holders direct rights to delete links. He also said that the indictment relied on a malicious interpretation of technical issues to construe its claim of criminal intent, and that there was significant legal use of Megaupload.
Criminal defense action
Kim Dotcom denied the charges filed against him and retained the services of
Ira P. Rothken
Ira P. Rothken is an American high technology attorney and computer scientist who has handled numerous cases of first impression involving the internet and new technologies.
Education and Early Work
Rothken is a graduate of Brandeis University ...
, an attorney who has defended several copyright infringement cases. Ira Rothken stated that there is no criminal liability for secondary copyright infringement under US law, quoting a similar case involving YouTube as an example of similar accusations which were dealt with as a civil case.
Dotcom initially hired Washington, D.C. attorney
Robert Bennett, who had confirmed he was going to represent Megaupload in the copyright infringement case. On 22 January 2012, Bennett withdrew from the case due to a conflict of interest with another client. As of 23 January, attorney Paul Davison was quoted as representing Megaupload's founder, Kim Dotcom, in New Zealand. At the end of April 2012, a controversy emerged over legal representation. The law firm
Quinn Emanuel, retained by Megaupload to argue for the retention of Megaupload's data, said in a motion filed to the court that there was a concerted effort by the
United States Department of Justice
The United States Department of Justice (DOJ), also known as the Justice Department, is a federal executive department of the United States government tasked with the enforcement of federal law and administration of justice in the United Stat ...
to deny Megaupload fair legal representation. In the brief, Quinn Emanuel alleged that several law firms dropped out of the case after the DoJ informed them of potential conflicts of interest, arguing that they wanted to call clients of the firms as witnesses. Given the size of the Megaupload, Quinn Emanuel said this "conflict of interest" argument could be applied to any law firm with experience in intellectual property rights, denying Megaupload experienced representation in a case where both law and technical issues are involved. Quinn Emanuel received such a letter but rejected the DoJ's arguments.
Techdirt
Techdirt is an American Internet blog that reports on technology's legal challenges and related business and economic policy issues, in context of the digital revolution. It focuses on intellectual property, patent, information privacy and c ...
argued that while the
founder of Megaupload had a significant history of "flouting the law", evidence had potentially been taken out of context or misrepresented and could "come back to haunt other online services who are providing perfectly legitimate services".
Eric Goldman
Eric Goldman (born April 15, 1968) is a law professor at Santa Clara University School of Law. He also co-directs the law school's High Tech Law Institute. and co-supervises the law school's Privacy Law Certificate.
Career overview
Goldman is a ...
, a professor of law at
Santa Clara University, described the Megaupload case as "a depressing display of abuse of government authority". He pointed out that criminal copyright infringement requires that willful infringement has taken place, and that taking Megaupload offline had produced the "deeply unconstitutional effect" of denying legitimate users access to their data.
Other legal commentators have expressed more skepticism toward Megaupload's likelihood of defending against charges of aiding and abetting copyright infringement on "willfulness" grounds if the allegations of fact in the indictment turn out to be true.
The defence has drawn on procedural errors by the prosecution to challenge the case and in a judgement at the end of May 2012, New Zealand judge
David Harvey
David W. Harvey (born 31 October 1935) is a British-born Marxist economic geographer, podcaster and Distinguished Professor of anthropology and geography at the Graduate Center of the City University of New York (CUNY). He received his P ...
granted the defendants the right to the disclosure of evidence held by the FBI in preparation for the extradition trial. In his 81-page decision, he came to the assessment that the DoJ is attempting to use concepts of civil law, in particular secondary copyright infringement, in a criminal case, which creates legal issues. He also confirmed that the charges in the indictment relating to money laundering, racketeering and wire fraud are not separate criminal acts but are dependent on the claim of criminal secondary copyright infringement. In a separate development in the United States, the defense has challenged the case against Megaupload as a whole, saying the US has no jurisdiction over a foreign company and the seizure of Megaupload's assets was unlawful.
[
]
A second brief points out numerous legal errors in the indictment, declaring it "an experiment in stretching U.S. criminal law well past the breaking point."
Data retention
Following the seizure of Megaupload, concerns were raised as to what would happen to the files that had been uploaded by its users.
On 20 January 2012, the Justice Department stated that "It is important to note that Mega clearly warned users to keep copies of any files they uploaded" adding that "Megaupload.com expressly informed users through its Frequently Asked Questions ('FAQs') and its Terms of Service that users have no proprietary interest in any of the files on Megaupload's servers, they assume the full risk of complete loss or unavailability of their data, and that Megaupload can terminate site operations without prior notice."
On 27 January 2012, U.S. Attorney Neil H. MacBride wrote:
The Mega Servers are not in the actual or constructive custody or control of the United States, but remain at the premises controlled by, and currently under the control of, Carpathia and Cogent. Should the defendants wish to obtain independent access to the Mega Servers, or coordinate third-party access to data housed on Mega Servers, the issue must be resolved directly with Cogent or Carpathia.
In response, on 30 January 2012, Carpathia Hosting denied having access to MegaUpload files and issued a press release stating
Carpathia Hosting does not have, and has never had, access to the content on MegaUpload servers and has no mechanism for returning any content residing on such servers to MegaUpload's customers. The reference to the 2 February 2012 date in the Department of Justice letter for the deletion of content is not based on any information provided by Carpathia to the U.S. Government. We would recommend that anyone who believes that they have content on MegaUpload servers contact MegaUpload. Please do not contact Carpathia Hosting.
The
Electronic Frontier Foundation has started a campaign to allow legitimate users of Megaupload in the US access to their data and wants the data preserved for that reason. It has chosen to represent one such legitimate user in court and thus has sided with Megaupload and Carpathia in asking the court to retain the data.
On 26 April 2012, Megaupload data negotiations began. Carpathia reported that maintaining the data costs over US$9,000 a day, and wanted to seek a formal resolution on whether to delete the data or release it to interested parties. United States district court Judge Liam O'Grady ordered all parties to return to the negotiating table. The U.S. Department of Justice noted that US$35 million had been paid by Megaupload to Carpathia, and alleged that Carpathia had knowingly profited from copyright infringement.
LeaseWeb wiped all of Megaupload's data.
Retaliatory attacks by Anonymous
Following the shutdown of the Megaupload website, the website of the
United States Department of Justice
The United States Department of Justice (DOJ), also known as the Justice Department, is a federal executive department of the United States government tasked with the enforcement of federal law and administration of justice in the United Stat ...
and other websites were taken offline following concerted
denial of service
In computing, a denial-of-service attack (DoS attack) is a cyber-attack in which the perpetrator seeks to make a machine or network resource unavailable to its intended users by temporarily or indefinitely disrupting services of a host connec ...
attacks attributed to
Anonymous.
Gizmodo concurred that it was "almost certainly the result of a quickly assembled
DDoS
In computing, a denial-of-service attack (DoS attack) is a cyber-attack in which the perpetrator seeks to make a machine or network resource unavailable to its intended users by temporarily or indefinitely disrupting services of a host connec ...
istributed Denial of Serviceattack—and easily the widest in scope and ferocity we've seen in some time", commenting that "if you had any doubts Anonymous is still a hacker wrecking ball, doubt no more".
Links posted in chatrooms and on
Twitter
Twitter is an online social media and social networking service owned and operated by American company Twitter, Inc., on which users post and interact with 280-character-long messages known as "tweets". Registered users can post, like, and ...
, when clicked on by unsuspecting Internet users, ran a web version of the application known as the
Low Orbit Ion Cannon.
On 19 January 2012, Anonymous released a statement on Pastebin.com taking responsibility for the mass attacks on websites including those of RIAA, MPAA, BMI, FBI, and others. According to the
RT network, Anonymous described the attacks as "the single largest Internet attack in its history".
Possible return of data
On 31 May 2013, a New Zealand court ordered police to return any items not relevant to the case and to provide copies of relevant material to Dotcom and his associates.
Other reactions
Former French president
Nicolas Sarkozy said he was satisfied with the shutdown of the website. He found the site's operators were reaping "criminal profits from the illegal distribution of copyrighted works". "The time has come for increased judicial and police co-operation between states" in the fight against online copyright infringement, he said in a statement.
Web organisations have raised concerns about possible effects of the Megaupload case on the future of
file sharing
File sharing is the practice of distributing or providing access to digital media, such as computer programs, multimedia (audio, images and video), documents or electronic books. Common methods of storage, transmission and dispersion include r ...
,
cloud storage, and
Internet commerce. Various commentators including
John C. Dvorak,
Glenn Greenwald
Glenn Edward Greenwald (born March 6, 1967) is an American journalist, author and lawyer. In 2014, he cofounded ''The Intercept'', of which he was an editor until he resigned in October 2020. Greenwald subsequently started publishing on Substac ...
, and
Julian Sanchez have written on the topic as well, particularly as it relates US government powers to take down a web site without a trial, even without new laws like
SOPA
Sopa or SOPA may refer to:
* Sopa (tribe), an Albanian tribe of the Sharr Mountains
* Lake Sopa, Albania
* School of Performing Arts Seoul, an arts high school in Seoul, South Korea
* Senior Officer Present Afloat, a term used in the U.S. Navy ...
. In fact, the
U.S. Dept of Justice was able to rely on
PRO-IP, a law passed back in 2008, in order to shut down Megaupload.
People who used Megaupload for personal and business storage, such as large audio and video files for family and work, have also voiced their complaints about the fact that they no longer had access to their files on the service.
Examples cited in the media included staff at public interest group ''
Public Knowledge
Public Knowledge is a non-profit Washington, D.C.-based public interest group. Founded in 2001 by David Bollier and Gigi Sohn, Public Knowledge is primarily involved in the fields of intellectual property law, competition and choice in the digi ...
'' who used it for large files, and
Android cellphone software writers who described it as "one of the best ways to distribute
oftware... There are a number of similar sites for this use, but Megaupload was always the fastest".
File hosting websites limited the functionality of their services. FileSonic.com, one of the top ten file hosting services, withdrew the ability to share links to files. The site's main page added a banner stating "All sharing functionality on FileSonic is now disabled. Our service can only be used to upload and retrieve files that you have uploaded personally." Other file hosting websites followed suit, including FileServe.com, FileJungle.com, Uploadstation.com, x7.to and 4shared.com, by shutting down, cancelling affiliate programs or allowing users to only download what they themselves uploaded. Another large file-sharing website, Uploaded.to, ceased services for users accessing from United States-based IP addresses.
According to
MediaFire
MediaFire is a file hosting, file synchronization, and cloud storage service based in Shenandoah, Texas, United States. Founded in June 2006 by Derek Labian and Tom Langridge, the company provides client software for Microsoft Windows, macOS, L ...
CEO Derek Labian, he and his file hosting company are not concerned by the Megaupload incident because "Megaupload was making a ridiculous amount of money with a ridiculously bad service... We don't have a business built on copyright infringement." A spokesperson for
RapidShare
RapidShare was an online file hosting service that opened in 2002. In 2009, it was among the Internet's 20 most visited websites and claimed to have 10 petabytes of files uploaded by users with the ability to handle up to three million users si ...
similarly expressed a lack of concern, saying that "file hosting itself is a legitimate business", pointing out that Microsoft's
SkyDrive operates on a similar basis.
BTJunkie
BTJunkie was a BitTorrent web search engine operating between 2005 and 2012. It used a web crawler to search for torrent files from other torrent sites and store them on its database. It had nearly 4,000,000 active torrents and about 4,200 torre ...
, a website indexing
torrent file
In the BitTorrent file distribution system, a torrent file or meta-info file is a computer file that contains metadata about files and folders to be distributed, and usually also a list of the network locations of trackers, which are compute ...
s, shut down voluntarily on 6 February 2012. The file hosting site Turbobit.net blocked access to U.S. visitors, and QuickSilverScreen, a site offering
streaming video links, closed on 7 February 2012.
See also
*
Legal aspects of file sharing
File sharing is the practice of distributing or providing access to digital media, such as computer programs, multimedia (audios, photos and/or videos), program files, documents or electronic books/magazines. It involves various legal aspects ...
*
Library.nu
Library.nu, previously called ebooksclub.org from 2004 to 2007 and gigapedia.com from 2007 to 2010, was a popular linking website. It was accused of copyright infringement and was shut down by court order on February 15, 2012. According to the t ...
*
Megaupload legal case
The Megaupload legal case concerns a number of related criminal indictments and enforcement actions taken against Megaupload owner Kim Dotcom in various jurisdictions. On 19 January 2012 the United States Department of Justice seized and shut ...
*
Seizure of Megaupload
The seizure of Megaupload, a popular filesharing website with 150 million registered users, occurred on January 19, 2012, following a US indictment accusing Megaupload of harbouring millions of copyrighted files. According to the indictment, M ...
References
External links
Websites operated by Megaupload
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Megaporn
Articles
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Court Documents
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Other
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{{DEFAULTSORT:Megaupload
2005 establishments in Hong Kong
Defunct websites
Former video hosting services
Hong Kong websites
Image-sharing websites
Internet properties disestablished in 2012
Internet properties established in 2005
Internet services shut down by a legal challenge
Kim Dotcom
Notorious markets
One-click hosting