Copyright Wars Continue: Kim Dotcom Has Been Granted Bail

Megaupload founder Kim Dotcom, who had been arrested on January 20^th 2012 following a police raid on his estate in Auckland, New Zealand, has been granted bail today after after a month of incarceration. Dotcom had previously been denied bail on the grounds that he was a serious flight risk; this assertion was made largely on the justification that the authorities were previously unsure as to the true amount of assets possessed by Dotcom, and also that during the raid on his home police had discovered multiple passports of both his previous names (Kim Schmitz, and Kim Tim Jim Vestor) as well as German and Finnish variations of these passports (due to his dual citizenship). Since that time all of Dotcom’s known assets have either been seized or frozen including millions of dollars in investments as well as luxury cars and artwork. According to the North Shore District Court Judge Nevin Dawson:

“In my view, after taking all matters now known to this court into account, the factors relating to flight risk are not now of such concern that there remains just cause to continue to remand Mr. Dotcom in custody once satisfactory bail conditions are imposed to alleviate the remaining concerns about his possible flight.”

Kim Dotcom was released without any monetary bail bond which is a standard practice for cases that go before the New Zealand district courts. Upon his release the exuberant Dotcom spoke briefly with reporters stating, “I am relieved to go home to see my family, my three little kids and my pregnant wife,” he also added, “And I hope you understand that is all I want to say right now.”

The raid that took place January 20^th was a joint effort in which New Zealand authorities coordinated with the Federal Bureau of Investigation and Justice Department, 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, the Royal Canadian Mounted Police and the Canadian Department of Justice. The arrest targeted Kim Dotcom as the leader of a “Mega-conspiracy,” but he was not alone. According to a statement on the FBI website, Dotcom, along with chief marketing officer Finn Batato, chief technical officer Mathias Ortmann, and Programmer Bram van der Kolk, were arrested by New Zealand authorities, who according to the New Zealand police press statement, “executed provisional arrest warrants requested by the United States Department of Justice for the purpose of extradition.” Andrus Nomm was also arrested by Dutch police in the Netherlands, and Sven Echternach by German police.

Megaupload.com is a file sharing website which allows users the ability to upload and store files both large and small on their site directly. Since the arrests the domain of Megaupload.com has been seized and shut down by the U.S. District Court. The U.S. Department of Justice alleges the site was the hub of an “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 $500 million in harm to copyright owners.” The content hosting site is said to have over 150 million registered users and generates traffic of over 50 million visitors daily.

According to the Indictment based out of the United States District Court for the Eastern District of Virginia the accused defendants face the following charges: 1) conspiracy to commit racketeering, 2) conspiracy to commit copyright infringement, 3) conspiracy to commit money laundering, 4) criminal copyright infringement by distributing a copyrighted work being prepared for commercial distribution on a computer network & aiding and abetting of criminal copyright infringement, 5) criminal copyright infringement by electronic means & aiding and abetting of criminal copyright infringement. According to the Department of Justice, if found guilty the accused could face the following maximum penalties: twenty years in prison on the charge of conspiracy to commit racketeering, five years in prison on the charge of conspiracy to commit copyright infringement, twenty years in prison on the charge of conspiracy to commit money laundering, and five years in prison on each of the additional charges of criminal copyright infringement.

This is the latest battle in the modern copyright wars, one that will again test the Digital Millennium Copyright Act’s safe harbor, and one the Department of Justice is calling one of the largest copyright crackdowns in history.

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