Megaupload helped FBI take down a video pirating website, then FBI used that same evidence against Megaupload

Megaupload was taken down by the FBI (and New Zealand authorities) on January 19, 2012. One of the accusations leveled against Megaupload by the Feds was (is) Megaupload ignored Digital Millennium Copyright Act (DMCA) take down requests for pirated content stored on Megaupload servers. As an example, in a document set before a Grand Jury in February 2012, the FBI mentioned: in 2010 Megaupload became aware of about 36 pirated movies on their server but still did not remove those movies by November 18, 2011. As it turns out, this particular example used by the FBI is not what it seems.

In 2010 the FBI was building a case against NinjaVideo, a movie/TV show pirating website that was known for mocking DMCA take down requests. During their investigation, the FBI learned of pirated movies stored by NinjaVideo on Megaupload servers. As such, the FBI served Megaupload with a warrant in June 2010 in regards to these video files.

Because of this warrant, Megaupload did not delete or modify the files in questions because the files were evidence. According to Kim Dotcom, “the [FBI] agent was concerned that the target could be warned and that this needs to be handled confidentially. Obviously when the FBI contacted us they made this clear to us and therefore we did not touch the accounts or the files.”

As cruel karma may have it, it is these same video files that the FBI used in the above-mentioned document of Megaupload’s complacency to piracy; these are the 36 video files the FBI said Megaupload did not delete despite knowing about them. So, essentially, Megaupload’s willingness to assist in the legal process came back to bite them in the butt — literally.

Of course, it should be mentioned that this is only one example in the 90-page “Superseding Indictment” document the FBI presented to the Grand Jury in February 2012. While the FBI may have misstepped this specific time, that doesn’t mean their whole case against Megaupload is flawed. I’m not saying the FBI was right in bringing down Megaupload, nor am I saying they were wrong; I’m saying one mistake on a laundry list of offenses doesn’t necessarily kill a case.

Still, one must wonder: is the FBI’s whole case against Megaupload filled with holes? Or were the Feds justified in taking action against the company? If going off anecdotal evidence, I’d lean more towards the latter — it is hard to deny Megaupload was a heaven for pirated content. However, the question isn’t of if people uploaded content to Megaupload or not; Digital Millennium Copyright Act protects companies like Megaupload from prosecution if they do their due diligence. The question is was Megaupload complacent to the piracy by not taking proper action vis-a-vis DMCA. We may never really, truly know.

[via TorrentFreak, image via cliff1066]

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6 comments

  1. JMJ

    DotCom was a brilliant rogue since his early teens, when he was first arrested, prosecuted and jailed. He knew what the force of law could do to him if he again got caught doing something illegal. At the time of this raid, he was happily married, filthy rich and living a dream life. I think it highly unlikely that he would risk all that by, after being DULY notified of infringing material residing on his servers, refusing to remove it. One or thirty-six or ten-thousand files/accounts would not be cause him to risk everything. He just had too much to lose. Ignoring any such legitimate takedown orders would essentially make him an accessory to the crime. He is too smart for that.

    The governments involved appear to have overreached and used Gestapo-like tactics in doing so. At least New Zealand’s seems to be trying to correct their initial mistakes. Read Charles Graeber’s excellent article in November’s WIRED magazine.

    I, for one, hope DotCom survives this, rebuilds his empire and goes back to being the (publicly, anyway) obnoxious braggart he appears to be. I’ve already signed up for MEGA.com

  2. AT

    Even if there was no pirating anywhere, the entertainment industry will blame their audience for not paying enough whenever a movie or song bombs. Instead of making a better product, it’s the audiences’s fault for the industry’s failures.

    Megauploads’s downfall gave rise to countless other file sharing sites outside the reaches of the US and partners.

  3. Peter

    @ds5929: +1
    but holds for other countries too.
    The article shows the bad tricks that are used by organisations like MPAA and their henchmen to make lawyers and themselfes rich.
    In the german parliament most members are lawyers…

  4. Seamus McSeamus

    @ds5929:
    Yeah, I tend to agree with you. Unfortunately, the US government is filled with people who take legal bribes from just about every industry there is, so the interests of corporations are protected often at the cost of the the interests of the people.

    Megaupload may not have been strictly above board, but I strongly suspect some double dealing on behalf of the FBI as well. When the laws are written for and tailored to a particular industry, enforcement shouldn’t have to rely on entrapment and skulduggery to do their jobs.

    These kinds of laws are all about protecting the pocketbooks of company executives, not benefiting the artists who actually produce the content.

  5. ds5929

    US legislature & DOJ = bought and paid for muscle for the MPAA/RIAA ,organizations that would otherwise be under multiple RICO indictments. The old adage ‘the best legislature money can buy’ has never been more apt.