Intellectual Property

Did the Feds Set-Up MegaUpload?

The long-running MegaUpload saga has become known for the Keystone-Kops shenanigans of New Zealand authorities.



The long-running MegaUpload saga has become known for the Keystone-Kops shenanigans of New Zealand authorities who secured the wrong legal documents and broke laws against domestic spying in executing the will of their high-handed American masters — understandable, since incompetence and snoopiness are easier to grasp than the intricacies of intellectual property law. But the copyright claims that killed the once-huge company and set in motion events that may well determine how Kiwis cast their votes next election are still in play. And it emerged recently that some of the files that MegaUpload is accused of storing in violation of copyright law were actually retained at the request of the United States government.

According to Wired:

Eighteen months before Megaupload's operators were indicted in the United States, the company complied with a secret U.S. search warrant targeting five of its users, who were running their own file-sharing service using Megaupload's infrastructure, according to interviews and newly unsealed court documents.

The June 24, 2010 warrant to search the Megaupload servers in Virginia was part of a U.S. criminal investigation into NinjaVideo, which was piggy-backing on Megaupload's "Megavideo" streaming service. Though the feds had already begun quietly investigating Megaupload months before, in this case the government treated Megaupload as NinjaVideo's internet service provider, serving Megaupload with the warrant and asking them to keep it quiet.

What did MegaUpload get for its troubles?

Despite Megaupload's cooperation, the 39 infringing NinjaVideo files were later used against the popular file-sharing service as evidence to seize domains and prosecute Dotcom and others connected to the site.

The apparent entrapment may not be so straightforward, since the forbidden files were also found elsewhere on MegaUpload's servers. Theoretically, then, the U.S. Department of Justice could be going after MegaUpload for those other copies, rather than the ones it asked the company to retain.

But …

In the past year, we've had internationally coordinated armed raids, as well as a full-court press by the United States government, all over a friggin' copyright case against a company that has a history of cooperating with American authorities. Yes, there is, potentially, a lot of money in digital music and movie files, but this all seems oddly disprportionate to the core concerns in the case. Especially when it turns out that MegaUpload had previously worked with the feds, and the U.S. is complaining about files it asked the company to retain.

Far be it from me to suggest—

Oh, screw it. No, it isn't. The fact is, it increasingly looks like the United States government rented out the Department of Justice as a hit squad to the entertainment industry to enforce a contract on MegaUpload.

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  1. The fact is, it increasingly looks like the United States government rented out the Department of Justice as a hit squad to the entertainment industry to enforce a contract on MegaUpload

    Does this surprise you in any way, JD? You know that FBI warning at the beginning of movies? They’ve been doing this for a long time.

    1. The milquetoast called humans would continue to watch Hollywood crap by the lifetime even if the FBI notice prefacing every DVD stated that copyright infringement would result in immediate execution. Every time I pop in a disk which is becoming rarer by the year I am irritated by the blatant arrogance of that FBI warning. It’s a fucking 15 buck movie for fuck’s sake!

  2. Did the Feds Set-Up MegaUpload?

    Ya think?

    1. And the poor NZ prosecutors have been left hanging in the breeze by the FBI/DOJ violations of NZ court orders.

      It is perfect – the DOJ can blame foreign courts for their own screw-ups.

  3. In the words of the previous Administration:

    We strongly oppose Title I of the bill, which not only authorizes the Attorney General to pursue civil remedies for copyright infringement, but to secure “restitution” damages and remit them to the private owners of infringed copyrights. First, civil copyright enforcement has always been the responsibility and prerogative of private copyright holders, and U.S. law already provides them with effective legal tools to protect their rights: they can obtain injunctions, 17 U.S.C. 5 502; impound and destroy infringing articles, 17 U.S.C. 5 503; recover their actual damages and costs, 17 U.S.C. 5 504(b); obtain statutory damages, which are similar to punitive damages, 17 U.S.C. 5 504(c); and obtain their costs and attorney’s fees in some circumstances, 17 U.S.C. 5 505. These tools also provide strong incentives for all copyright holders, including individual copyright holders and small businesses not represented by trade groups or industry organizations, to enforce their rights.

    Second, Title 1’s departure from the settled framework above could result in Department of Justice prosecutors serving as pro bono lawyers for private copyright holders regardless of their resources. In effect, taxpayer-supported Department lawyers would pursue lawsuits for copyright holders, with monetary recovery going to industry.

    1. Third, the Department of Justice has limited resources to dedicate to particular issues, and civil enforcement actions would occur at the expense of criminal actions, which only the Department of Justice may bring. In an era of fiscal responsibility, the resources of the Department of Justice should be used for the public benefit, not on behalf of particular industries that can avail themselves of the existing civil enforcement provisions.

      Of course, if the Obama Administration actually cared about things other than helping out its friends…

      1. So what you’re saying is that this is all BOOOOOOOOSH’s fault?

  4. Saddam Hussein worked for the US government for a long time, too. So did Osama bin Laden. That kind of track record is more an indicator of the target Uncle Sam will someday paint on your back, than a reason to be confident that Sammy has or will ever have your back.

    “We got a burn notice on you: You’re blacklisted.” {long whistle FX}

    In my opinion, the idea that governments use extra-constitutional covert methods against, and send armed swat teams out to raid, those who are suspected of dealing in IP contraband, is anathema to a free and civilized society. The consequences of copyright infringement should never entail criminal sanction or rough, violent enforcement, but should always be limited to actual financial damages done (or, at worst, punitive damages specifically tailored for the facts and circumstances of each exceptionally egregious case). DMCA delenda est.

  5. Glad to see the MPAA and the RIAA are clutching that vise grip tightly on Eric Holder’s balls.

    Now, about those Mexicans…

  6. The odd thing about this is, at this point BO has no use for Hollywood’s support anymore. The only explanation is that people in his administration are angling for sweet industry consulting/lobbying gigs after they are done working in Washington.

  7. FDA vs. snooty organic food company… I’m not sure who to root for.

    FDA officials found salmonella all over Sunland Inc.’s New Mexico processing plant after 41 people in 20 states, most of them children, were sickened by peanut butter manufactured at the plant in Portales and sold by Trader Joe’s grocery chain. The FDA suspended Sunland’s registration Monday, preventing the company from producing or distributing any food.

    The food safety law gave the FDA authority to suspend a company’s registration when food manufactured or held there has a “reasonable probability” of causing serious health problems or death. Before the food safety law was enacted early last year, the FDA would have had to go to court to suspend a company’s registration.

  8. Judging by the rampant corporatism these days, I start to wonder whether the fascists really won World War II after all.

    1. Technically not since actual Fascism requires heavy doses of nationalism which is decidedly out of favor in most places and certainly amongst the power elite.

      That said, what do you call a system of government which marries Fascist economics with a globalist approach to international affairs?

  9. Can we all start addressing him as Emperor now?

  10. Oh, screw it. No, it isn’t. The fact is, it increasingly looks like the United States government rented out the Department of Justice as a hit squad to the entertainment industry to enforce a contract on MegaUpload.

    Did it ever look otherwise?

    Unless you mean the part about rental. I think it’s owned by the entertainment industry.

  11. Their big mistake was in not realizing that the Kiwis actually still have a legal system that respects due process. Were they able to prosecute Dotcom in the US, I’m sure there’d have been none of this annoying wrangling about who went all paramilitary on who, and who messed up their silly search warrants.

  12. Did the Feds Set-Up MegaUpload?

    Ick. Enough with the overused hyphens, please.

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