As the US Senate and House of Representatives prepared to vote on their respective versions of an online piracy bill, websites shutdown for 24 hours and millions of Americans signed a petition of protest. The bills have since been scrapped, at least temporarily, in favour of rewrites of the bills. Congressional bills known as SOPA and PIPA were aimed at sites outside of the US.
One day later, on Thursday January 19; the United States government shutdown the “cyberlocker” file sharing site Megaupload.com and a number of the site’s sister sites.
The Justice Department alleged that the popular site was fostering illegal downloading to the tune of $500 million to copyright owners. The site offers users the ability to download large files at fast speeds that are too big to send via emails.
While Megaupload is based in Hong Kong, Justice claims that some of the servers used by Megaupload for “its pirated content” were located in Virginia allowing them to act on the indictment. Megaupload founder Kim Dotcom (also known as Kim Schmitz and Kim Tim Jim Vestor) was arrested along with three other employees; but three others are still at large.
Before the site was shut down, Megaupload issued a statement saying that the allegations of massive breaches of copyright was “grotesquely overblown”. The fact is that the vast majority of Mega’s Internet traffic is legitimate, and we are here to stay.”
While not listed in the indictment, there are a number of celebrities who have endorsed the massive file sharing site including Kim Kardashian, Alicia KeysAlicia Keys, Kanye WestKanye West, and Swizz Beatz who is listed as the site’s CEO.
The indictment sites copyright infringement, racketeering, and conspiracy to commit money laundering. Justice also alleges that Megaupload “turned a blind eye to requests from copyright holders to remove copyright protected files”.
Megaupload claimed to have 150 million registered users and some 50 million hits each day. Attorneys for Megaupload and its employees could either not be reached or refused comment.
Megaupload founder Kim Dotcom is listed as having homes in Hong Kong and New Zealand, and has dual citizenship in Finland and Germany. He reportedly made $42 million in 2010 from Megaupload. While Dotcom was arrested in New Zealand, officials said that it could take up to as much as one year for extradition.