Feds Shut Down 'Megaupload'

[Supernova]

Justice Department Charges Leaders of Megaupload with Widespread Online Copyright Infringement

WASHINGTON – Seven individuals and two corporations have been charged in the United States with running an international organized criminal enterprise allegedly responsible for massive worldwide online piracy of numerous types of copyrighted works through Megaupload.com and other related sites, generating more than $175 million in criminal proceeds and causing more than half a billion dollars in harm to copyright owners, the U.S. Justice Department and FBI announced today.

This action is among the largest criminal copyright cases ever brought by the United States and directly targets the misuse of a public content storage and distribution site to commit and facilitate intellectual property crime.

The individuals and two corporations - Megaupload Limited and Vestor Limited - were indicted by a grand jury in the Eastern District of Virginia on Jan. 5, 2012, and charged with engaging in a racketeering conspiracy, conspiring to commit copyright infringement, conspiring to commit money laundering, and two substantive counts of criminal copyright infringement. The individuals each face a maximum penalty of 20 years in prison on the charge of conspiracy to commit racketeering, five years in prison on the charge of conspiracy to commit copyright infringement, 20 years in prison on the charge of conspiracy to commit money laundering, and five years in prison on each of the substantive charges of criminal copyright infringement.

The indictment alleges that the criminal enterprise is led by Kim Dotcom, aka Kim Schmitz, and Kim Tim Jim Vestor, 37, a resident of both Hong Kong and New Zealand. Dotcom founded Megaupload Limited and is the director and sole shareholder of Vestor Limited, which has been used to hold his ownership interests in the Mega-affiliated sites.

In addition, the following alleged members of the Mega conspiracy were charged in the indictment:

• Finn Batato, 38, a citizen and resident of Germany, who is the chief marketing officer;
  
• Julius Bencko, 35, a citizen and resident of Slovakia, who is the graphic designer;
  
• Sven Echternach, 39, a citizen and resident of Germany, who is the head of business development;
  
• Mathias Ortmann, 40, a citizen of Germany and resident of both Germany and Hong Kong, who is the chief technical officer, co-founder and director;
  
• Andrus Nomm, 32, a citizen of Estonia and resident of both Turkey and Estonia, who is a software programmer and head of the development software division;
  
• Bram van der Kolk, aka Bramos, 29, a Dutch citizen and resident of both the Netherlands and New Zealand, who oversees programming and the underlying network structure for the Mega conspiracy websites.
  

Dotcom, Batato, Ortmann, and van der Kolk were arrested today in Auckland, New Zealand, by New Zealand authorities, who executed provisional arrest warrants requested by the United States. Bencko, Echternach, and Nomm remain at large. Today, law enforcement also executed more than 20 search warrants in the United States and eight countries, seized approximately $50 million in assets, and targeted sites where Megaupload has servers in Ashburn, Va., Washington, D.C., the Netherlands, and Canada. In addition, the U.S. District Court in Alexandria, Va., ordered the seizure of 18 domain names associated with the alleged Mega conspiracy.

According to the indictment, for more than five years the conspiracy has operated websites that unlawfully reproduce and distribute infringing copies of copyrighted works, including movies - often before their theatrical release - music, television programs, electronic books, and business and entertainment software on a massive scale. The conspirators’ content hosting site, Megaupload.com, is advertised as having more than one billion visits to the site, more than 150 million registered users, 50 million daily visitors, and accounting for four percent of the total traffic on the Internet. The estimated harm caused by the conspiracy’s criminal conduct to copyright holders is well in excess of $500 million. The conspirators allegedly earned more than $175 million in illegal profits through advertising revenue and selling premium memberships.

The indictment states that the conspirators conducted their illegal operation using a business model expressly designed to promote uploading of the most popular copyrighted works for many millions of users to download. The indictment alleges that the site was structured to discourage the vast majority of its users from using Megaupload for long-term or personal storage by automatically deleting content that was not regularly downloaded. The conspirators further allegedly offered a rewards program that would provide users with financial incentives to upload popular content and drive web traffic to the site, often through user-generated websites known as linking sites. The conspirators allegedly paid users whom they specifically knew uploaded infringing content and publicized their links to users throughout the world.

In addition, by actively supporting the use of third-party linking sites to publicize infringing content, the conspirators did not need to publicize such content on the Megaupload site. Instead, the indictment alleges that the conspirators manipulated the perception of content available on their servers by not providing a public search function on the Megaupload site and by not including popular infringing content on the publicly available lists of top content downloaded by its users.

As alleged in the indictment, the conspirators failed to terminate accounts of users with known copyright infringement, selectively complied with their obligations to remove copyrighted materials from their servers and deliberately misrepresented to copyright holders that they had removed infringing content. For example, when notified by a rights holder that a file contained infringing content, the indictment alleges that the conspirators would disable only a single link to the file, deliberately and deceptively leaving the infringing content in place to make it seamlessly available to millions of users to access through any one of the many duplicate links available for that file.

The indictment charges the defendants with conspiring to launder money by paying users through the sites’ uploader reward program and paying companies to host the infringing content.

The case is being prosecuted by the U.S. Attorney’s Office for the Eastern District of Virginia and the Computer Crime & Intellectual Property Section in the Justice Department’s Criminal Division. The Criminal Division’s Office of International Affairs, Organized Crime and Gang Section, and Asset Forfeiture and Money Laundering Section also assisted with this case.

The investigation was initiated and led by the FBI at the National Intellectual Property Rights Coordination Center (IPR Center), with assistance from U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Substantial and critical assistance was provided by the New Zealand Police, the Organised and Financial Crime Agency of New Zealand (OFCANZ), the Crown Law Office of New Zealand,and the Office of the Solicitor General for New Zealand; Hong Kong Customs and the Hong Kong Department of Justice; the Netherlands Police Agency and the Public Prosecutor’s Office for Serious Fraud and Environmental Crime in Rotterdam; London’s Metropolitan Police Service; Germany’s Bundeskriminalamt and the German Public Prosecutors; and the Royal Canadian Mounted Police-Greater Toronto Area (GTA) Federal Enforcement Section and the Integrated Technological Crime Unit and the Canadian Department of Justice’s International Assistance Group. Authorities in the United Kingdom, Australia, and the Philippines also provided assistance.

This case is part of efforts being undertaken by the Department of Justice Task Force on Intellectual Property (IP Task Force) to stop the theft of intellectual property. Attorney General Eric Holder created the IP Task Force to combat the growing number of domestic and international intellectual property crimes, protect the health and safety of American consumers, and safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation, and hard work. The IP Task Force seeks to strengthen intellectual property rights protection through heightened criminal and civil enforcement, greater coordination among federal, state, and local law enforcement partners, and increased focus on international enforcement efforts, including reinforcing relationships with key foreign partners and U.S. industry leaders. To learn more about the IP Task Force, go to www.justice.gov/dag/iptaskforce.

Source

[KKvampire]

The USA will fail if it thinks it can control Internet information and content in this way. SOPA (which means "Trash" in Swedish) is unworkable. The Federal government with its tentacles trying to extradite so called "offenders " from all corners of the world is like picking up a few ants from a whole nest , there are so many more.What a mad state when some Grand Jury in Virgina can issue an indictment to individuals in countries worldwide. USA Corprations, with the former US senator Dodd, taking millions of $ and leading them are not going to succeed.US Justice =control

http://static.thepir.../legal/sopa.txt

Edited January 20, 2012 by KKvampire

[Supernova]

Anonymous Goes on Megaupload Revenge Spree: DoJ, RIAA, MPAA, and Universal Music All Offline

Click here

[necronx99]

Screw this, I'm starting my own internet. It will have porn, gambling, email, porn, social networking, porn, a wiki, a search engine, porn, torrents, news and porn. The US can go kiss my ass.

Domains at nec. are available now.

[urandom]

Now is the time the Free World should punish this abuse of power and send those guys drones, fighters and soldiers to teach them Democracy and the... WAIT WHAT??

[robblok]

I understand the USA, i mean they are still stealing from the artist and movie producers. Why should it be legal just because the servers are in a different country. The people who made the work are in the USA and loosing money.

Would be a different thing if the USA was enforcing for artist that are not in the USA.

These guys are making money off pirated stuff.

I am no angel i download stuff too but i understand its illegal and that the people who made it are loosing money. So if they see ways to shut it down they should.

[beano2274]

They are hitting people in the pockets, some people download these movies and sell them, I admit downloading movies but I would never sell them on to anyone.

many other countries might follow suit, I for one download my weekend footie. So be prepared for more closures

[robblok]

Sure i download my fair share of movies, but i don't see it as that im entitled to it. They are well in their right to close it.

The people making the money are the owners of the download site, with something illegal. I for one would be pissed off if my work was being stolen and others made money off it.

I also dont sell the movies that i download but still i am not paying either.

[BlackJack]

i think the big picture here is a trail run to see how they can shut down and arrest sites like Wikileaks and other sites that dont conform with the way governments like to run their countries.

You will find Murdoch and his billlions of dollars behind some of it.

But then you have other ways to download and distribute - you can email your friend a movie - or bluetooth it - or go to Tucom - or or or

Its all about controlling the internet

full stop

[rossigee]

How convenient. Nothing to do with the upcoming PIPA/SOPA fuss, I guess?!

[Centrum]

I understand the USA, i mean they are still stealing from the artist and movie producers. Why should it be legal just because the servers are in a different country. The people who made the work are in the USA and loosing money.

Would be a different thing if the USA was enforcing for artist that are not in the USA.

These guys are making money off pirated stuff.

I am no angel i download stuff too but i understand its illegal and that the people who made it are loosing money. So if they see ways to shut it down they should.

It's a bit hypocritical.

The US has raped and pillaged from nations south of its border for 2 centuries.

They certainly never thought about paying a fair price for the natural resources they stole.

[TheWalkingMan]

I am waiting for one of the unfriendly to the US countries to start setting up high speed servers full of content.

[bobl]

I'm no saint. I have downloaded stuff on occasion. While I may be in a very grey area legally, I have absolutely no qualms about the morals of doing so. I pay my television license in the UK so if I download and watch "rips" of a few series I like to follow while I'm not in the UK, the industry has lost precisely ZERO, to my activities.

However, and ironically, I have NEVER downloaded anything from Megaupload that wasn't legal.

[PattayaParent]

I understand the USA, i mean they are still stealing from the artist and movie producers. Why should it be legal just because the servers are in a different country. The people who made the work are in the USA and loosing money.

Would be a different thing if the USA was enforcing for artist that are not in the USA.

These guys are making money off pirated stuff.

I am no angel i download stuff too but i understand its illegal and that the people who made it are loosing money. So if they see ways to shut it down they should.

They would only lose money if people are prepared to pay for it rather than get it for free, which they obviously are not.

[impulse]

Screw this, I'm starting my own internet. It will have porn, gambling, email, porn, social networking, porn, a wiki, a search engine, porn, torrents, news and porn. The US can go kiss my ass.

Domains at nec. are available now.

Yes, but will you have porn?

[winty]

So much for shutting it down. It's already back again, just with a slightly different name. It's a good hosting site, not just about piracy.. im glad it's back.

[jshorts]

I'm unclear what you are saying.

Are you saying that you feel that the US DOJ should not enforce the copyright laws?

If you feel they should not enforce them, do you feel owners of any type of intellectual property should be provided with any type of protection?

Assuming you don't go into Big C on a shoplifting spree, how do you unabashedly admit to stealing/downloading copyrighted material from the internet?

Lastly, if a rogue country set up a server with copyrighted material, how would that affect worldwide copyright holders? Do you think that many country would express concern in a variety of ways?

[necronx99]

Screw this, I'm starting my own internet. It will have porn, gambling, email, porn, social networking, porn, a wiki, a search engine, porn, torrents, news and porn. The US can go kiss my ass.

Domains at nec. are available now.

Yes, but will you have porn?

Just to clarify, for those of you concerned about the availability of porn on my new internet, the news, wiki, torrents, search and social media will be mostly about porn.

Get your nec. domains now. The early bird gets the big IPO!

Edited January 20, 2012 by necronx99

[necronx99]

I'm unclear what you are saying.

Are you saying that you feel that the US DOJ should not enforce the copyright laws?

If you feel they should not enforce them, do you feel owners of any type of intellectual property should be provided with any type of protection?

Assuming you don't go into Big C on a shoplifting spree, how do you unabashedly admit to stealing/downloading copyrighted material from the internet?

Lastly, if a rogue country set up a server with copyrighted material, how would that affect worldwide copyright holders? Do you think that many country would express concern in a variety of ways?

Well that country could just treat any complaints about it's behavior and treaty obligations exactly the same way the US does when they lose any WTO cases.

[robblok]

I understand the USA, i mean they are still stealing from the artist and movie producers. Why should it be legal just because the servers are in a different country. The people who made the work are in the USA and loosing money.

Would be a different thing if the USA was enforcing for artist that are not in the USA.

These guys are making money off pirated stuff.

I am no angel i download stuff too but i understand its illegal and that the people who made it are loosing money. So if they see ways to shut it down they should.

They would only lose money if people are prepared to pay for it rather than get it for free, which they obviously are not.

True its a grey area never said it was all black and white. But i know what im doing is stealing and if someone stops me trying to do that its their right. I am not going to moan about it.

[urandom]

Providing remote storage is not the the same as copyright infrigement. Otherwise, we should just shutdown the internets as it's the way to access copyrighted material. MU had a DMCA policy to remove copyrighted files on demand. Lastly, sorry to disappoint you USA but your laws are not World Wide Laws.

Also, copying is not equal to stealing (cf. the dumb Big C example somewhere above).

[jshorts]

I'm unclear what you are saying.

Are you saying that you feel that the US DOJ should not enforce the copyright laws?

If you feel they should not enforce them, do you feel owners of any type of intellectual property should be provided with any type of protection?

Assuming you don't go into Big C on a shoplifting spree, how do you unabashedly admit to stealing/downloading copyrighted material from the internet?

Lastly, if a rogue country set up a server with copyrighted material, how would that affect worldwide copyright holders? Do you think that many country would express concern in a variety of ways?

Well that country could just treat any complaints about it's behavior and treaty obligations exactly the same way the US does when they lose any WTO cases.

Yes, they could treat any complaints in that way. And, do you think that countries other than the US would be concerned about the copyright infringement?

How would you handle this problem?

[jshorts]

Providing remote storage is not the the same as copyright infrigement. Otherwise, we should just shutdown the internets as it's the way to access copyrighted material. MU had a DMCA policy to remove copyrighted files on demand. Lastly, sorry to disappoint you USA but your laws are not World Wide Laws.

Also, copying is not equal to stealing (cf. the dumb Big C example somewhere above).

Copying anything copyrighted without paying for it is stealing. (Please attempt to be civil.)

[Gone]

What am I gonna do on my iPhone now?

[urandom]

Providing remote storage is not the the same as copyright infrigement. Otherwise, we should just shutdown the internets as it's the way to access copyrighted material. MU had a DMCA policy to remove copyrighted files on demand. Lastly, sorry to disappoint you USA but your laws are not World Wide Laws.

Also, copying is not equal to stealing (cf. the dumb Big C example somewhere above).

Copying anything copyrighted without paying for it is stealing. (Please attempt to be civil.)

no it's not stealing, it's called copyright infringement.

[jshorts]

lease be serious. If you wrote a book or made a movie, would you be concerned if someone copied your book without paying for it?

What is your solution to the problem at hand?

Edited January 21, 2012 by astral
No need to quote the entire post

[necronx99]

This issue is not about copyright, it's about control.

As to copyright, it's not a legal problem, it's a market force one.

Edited January 21, 2012 by astral
No need to quote the entire post

[urandom]

I'm being so serious that I'm posting here to ask you to stop making false accusations of stealing. I'm not saying this is right, I'm asking you to please be serious.

Also, I'm not asking the copyright holders to help me find a way/pay from their pockets to make my business field as profitable as it were 15 years ago without adapting my business to the world we're living in. So basically, the answer to your question is: I don't care.

Edited January 21, 2012 by astral
No need to quote the entire post

[MaxYakov]

Screw this, I'm starting my own internet. It will have porn, gambling, email, porn, social networking, porn, a wiki, a search engine, porn, torrents, news and porn. The US can go kiss my ass.

Domains at nec. are available now.

You forgot to include 'porn'.

[Soboringtochooseaname]

I wish the biggest trouble to FBI and everyone supporting them.