MEGAUPLOAD: TAKEN DOWN, PIRACY ALLEGATIONS

Popular hard drive storage site MEGAUPLOAD has been taken down due to allegations of piracy. MEGAUPLOAD, primarliy meant as an online "extra hard drive" for storage of computer software programs, pictures, JPEG files has been accused of "file sharing", copy write infringement and racketeering by the FBI.

FROM TECHCRUNCH: Popular file-hosting site Megaupload, probably known to our readers for a variety of reasons, has been taken down after the FBI charged some of its staff with copyright infringement and “conspiracy to commit racketeering.” Seven people have been charged, and four arrested (in New Zealand), and the site itself appears to be down as authorities around the world closed in on the site’s resources.Bizarrely, it was also just revealed that the CEO of the company is none other than Swizz Beats, the husband of Alicia Keys. Clearly the rabbit hole goes much deeper than the FBI expected.Mr. Beats is just the acting CEO, and probably was brought on by founder Kim Dotcom as part of the site’s efforts to legitimize itself in the eyes of the law. Part of this effort was the publication of the so-called “Mega Song,” in which a number of musicians espouse the service as a useful and fast way of transferring files.In December, Will.I.Am, Sean “Diddy” Combs, and the others pulled their support, and it was claimed that they never consented to appearing in the video, which was subsequently removed from YouTube.


FROM GEEK.COM: Popular file sharing site MegaUpload has been shut down by federal authorities today who executed an indictment against the company and its founder. The indictment claims that the site was responsible for $500 million in losses to copyright holders due to music and movie piracy. Kim Dotcom, founder of MegaUpload maintains that his company has obeyed all due diligence requirements in regards to For those who have not used MegaUpload, it’s a service that allows its users to upload files that would be too large to send in an email for temporary hosting. The user can then distribute a link to recipients so they can download the files. While this is a totally legitimate practice, MegaUpload was also being used by pirates to upload movies, TV shows, and albums for free distribution. Added to this fact is the issue that MegaUpload has two membership tiers, free and premium. The company collected fees from premium members in exchange for faster download speeds and longer storage times. Because the company got paid for hosting and distributing pirated content, it was open to indictment for piracy charges as well.Founded in 2005, MegaUpload has been an interesting site to watch in relation to the ongoing global debate about online piracy. Dotcom has been working feverishly to maintain that his company and business is legitimate due to the amount of legal traffic happening on MegaUpload. Going so far as to leveraging endorsements from artists like Alicia Keys who was a victim of piracy on his site, Dotcom knew that MegaUpload was facing trouble but looking to put a good face on the issue.Coming just one day after many sites around the globe shut down to protest the SOPA and PIPA bills that are being deliberated in the US Senate, the timing of the raid is interesting. More on this story as it breaks.

FROM THE NY TIMES: "The federal authorities on Thursday announced that they had charged seven people connected to the Web site Megaupload, including its founder, with running an international criminal enterprise centered on copyright infringement on the Internet.According to a grand jury indictment, Megaupload — one of the most popular “locker” services on the Internet, which lets users anonymously transfer large files — generated $175 million in income for its operators through subscription fees and advertising, while causing $500 million in damages to copyright holders.Four of the seven people, including the site’s founder Kim Dotcom, born Kim Schmitz, have been arrested in New Zealand, the Justice Department and Federal Bureau of Investigation said on Thursday; the three others remain at large. The seven — who a grand jury indictment calls part of a “Mega Conspiracy” — have been charged with five counts of copyright infringement and conspiracy, the authorities said.The charges, which the government agencies said represented “among the largest criminal copyright cases ever brought by the United States,” come at a charged time, a day after online protests against a pair of antipiracy bills being considered by Congress — the Stop Online Piracy Act, or SOPA, in the House, and the Protect I.P. Act, or PIPA, in the Senate.In response to the arrests, the hacker collective known as Anonymous said it had taken down the Web sites of the Justice Department, the Motion Picture Association of America, and the Recording Industry Association of America. All three sites were inaccessible late Thursday afternoon The indictment in the Megaupload case was handed down by a grand jury in Virginia two weeks ago, but was unsealed on Thursday, and stems from a federal investigation that began two years ago.The Megaupload case touches on many of the most controversial aspects of the antipiracy debate.Megaupload and similar locker sites, like Rapidshare and Mediafire, are often promoted as being convenient ways to legitimately transfer large files — a recent promotional video had major stars like Will.i.am of the Black Eyed Peas singing Megaupload’s praises. But they have become notorious among media companies, who see them as abetting copyright infringement on a large scale by giving people easy, but unauthorized, access to movies, music and other content.Megaupload is currently engaged in a lawsuit with Universal over the promotional video and Universal’s efforts to have it removed from YouTube As part of the crackdown on Megaupload, 20 search warrants were executed in nine countries, including the United States. About $50 million in assets were also seized, as well as a number of servers and 18 domain names, the authorities said.Ira P. Rothken, a lawyer for Megaupload, said in a phone interview on Thursday afternoon that he had not yet seen the indictment, but he added: “Clearly we have due process concerns. This was done without a hearing.”


FROM ABCNEWS.COM:
The Justice Department has indicted seven individuals and two companies behind the popular file sharing website Megaupload.com which has been touted by stars will.i.am, Kim Kardashian and Puff Daddy.

The indictment alleges that the website and a shell company associated with the website, Vestor Limited, caused an estimated half-billion dollars in copyright losses and made an estimated $175 million in proceeds. The website was established in 2005 and at one point ranked as the 13th most visited website on the Internet.

The feds indicted the site's founder, Kim Dotcom, aka Kim Schmitz, a 37-year-old resident of Hong Kong and New Zealand. He was arrested in New Zealand by New Zealand authorities.

Also indicted were employees Bram van der Kolk, aka Bramos, 29, Julius Bencko, Finn Batato, Sven Echternach, Mathias Ortmann, and Andrus Nomm. New Zealand authorities arrested Batato, Ortmann and van der Kolk. Bencko, Echternach and Nomm remain at large, officials said.


Wikipedia Blackout: Online Piracy Grows Watch Video

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The indictment accuses the suspects of being members of "the Mega Conspiracy, a worldwide criminal organization whose members engaged in criminal copyright infringement and money laundering on a massive scale."

The case comes a day after internet companies and websites such as Google, WordPress and Wikipedia protested about the Stop Online Piracy Act (SOPA) and the PROTECT IP Act (PIPA).

An hour after the indictment was announced, the Justice Department's website, www.Justice.gov, came under cyberattack with a denial-of-service attack. Anonymous, the hacktivist computer group, is claiming responsibility.

The indictment returned by a grand jury in Virginia alleges, "In exchange for payment, the Mega Conspiracy provides the fast reproduction and distribution of infringing copies of copyrighted works from its computer servers located around the world. Premium users of the site... are able to download and upload files with few, if any, limitations."

Describing the operation of the site and relations with users the indictment noted, "For much of its operation, the Mega Conspiracy has offered an 'Uploader Rewards' Program, which promised premium subscribers transfers of cash and other financial incentives to upload popular works, including copyrighted works, to computer servers under the Mega Conspiracy's direct control and for the Conspiracy's ultimate financial benefit."

The seven suspects have been charged with participating in a racketeering conspiracy, conspiring to commit copyright infringement, conspiring to commit money laundering and two substantive counts of criminal copyright infringement.

If convicted they could face a maximum of 20 years in prison.

FROM PCMAG.COM:
Anonymous was quick to target the Justice Department, Universal Music, the RIAA, and MPAA in the wake of this afternoon's Megaupload announcement, with the Web sites for all four organizations succumbing to distributed denial of service (DDoS) attacks.
Justice.gov and universalmusic.com went offline around 430pm Eastern and have been largely unresponsive for the past 1.5 hours. RIAA.com and MPAA.org are also unresponsive.
"Recording Industry Association of America—Department of Justice—Universal Music—all TT, all TANGO DOWN," Anonymous tweeted this evening with the #OpMegaUpload hashtag.
Earlier today, the DOJ announced the shutdown of file-sharing site Megaupload. Seven individuals and two corporations were indicted for copyright infringement and could face up to 50 years in prison. Megaupload earned approximately $750 million for its exploits and incurred about $1 billion in damages, the agency alleged.
In its statement, the DOJ said the takedown was "among the largest criminal copyright cases ever brought by the United States."
How does Universal Music play into this? Megaupload's CEO is Kasseem Dean, better known as hip hop producer Swizz Beatz and husband of Alicia Keys. As reported by the New York Post, Beatz asked high-profile friends like Sean "Diddy" Combs, Kanye West, and Will.i.am to participate in a video promoting Megaupload, which did not sit too well with the artists' label, Universal Music Group. Last month, Universal had YouTube pull "Mega Song," prompting a lawsuit from Megaupload, according to TorrentFreak.
Anonymous has never been a fan of efforts to take down copyright infringers. The group has targeted Sony over its efforts to sue PlayStation hacker George Hotz and gone after the RIAA and the MPAA on numerous occasions.
In a statement issued this afternoon, the MPAA championed the Megaupload takedown. "This criminal case, more than two years in development, shows that law enforcement can take strong action to protect American intellectual property stolen through sites housed in the United States," said Chris Dodd, MPAA chairman and CEO.
The RIAA, meanwhile, said it was "deeply grateful" for the Megaupload shutdown. "The indictment outlines a sinister scheme to generate massive profits through the distribution of the stolen intellectual property of others," RIAA chairman and CEO Cary Sherman said in a statement.
The Megaupload takedown and the DDoS attacks come one day after many Web sites went dark in protest of anti-piracy legislation, the Stop Online Piracy Act (SOPA) and the PROTECT IP Act (PIPA). The bills would allow the DOJ to go after overseas, "rogue" Web sites, but opponents argue that the measures are too broad and could harm legitimate Web sites.
The RIAA's Sherman, a supporter of SOPA and PIPA, said the Megaupload news demonstrates why the bills are necessary. "If [Megaupload] were hosted and operated, for example, in a foreign country, our government would be essentially powerless to do anything about it. That needs to change," Sherman said.
For more, see the Top 5 Objections to SOPA, PIPA and PCMag analysts' take on the bills, as well as the slideshow below, which features screen shots from Web sites that participated in yesterday's blackout.

DAVID DRAIMAN (DISTURBED) ON FILE SHARING:
"My stance on file sharing/downloading;

"I have always been in favor of, that's correct, in favor of flie sharing and downloading digital music since day 1. I have never blamed the consumer for simply taking advantage of something that is readily and easily available to them, and enables the spread of great music and art to fans of it all over the globe.

"I have been in support of having nominal fees built into ISP subscription rates that would have enabled everyone to file share freely while still enabling artists to be compensated for their work. The proceeds could then have been payed out the same way writing/publishing royalties are, utilizing Internet monitoring systems, such as those developed by companies like Big Champagne, for example. The fans would get all the music they wanted for a nominal price, built into the Internet service that they are already paying for, and the artists and the ISPs would be able to still make it a viable busniess.

"Unfortunately, the RIAA [Recording Industry Association Of America] and music industry, simply chose to persecute the consumers, the very fans that give the artists and the labels the ability to exist, and bit the hand that fed them. This was a mistake in judgement, in my opinion. That is why when companies like Spotify came into existence, I was thrilled, because it gave the consumer the ability to have unlimited music at their fingertips, for a reasonable monthly subscription cost. It also enabled the exchange of music through social media as well, putting the icing on the proverbial cake.

"Make no mistake, however, that the culture that has been bred over the course of the last 10+ years of simply thinking that all music should be available for free is wrong, and immoral; plain and simple.

"This mentality has created an environment where it is more and more difficult for artists, particularly up-and-coming ones, to survive and sustain themselves.

"People wonder why fewer and fewer acts come out these days and are able to last. The status quo that exists is a huge factor in that. The creation of the '360 deal,' where labels now insist on taking a piece of everything new artists do, is a direct result of that.

"People's love of music is stronger than it ever has been, and the Internet has been an amazing tool, enabling artists to extend their respective reaches farther than ever before, but it has also created an environment where pirateers and websites that profit off of the traffic (by selling advertisements on their sites) created by offerring other people's life's work for free, is wrong and criminal in every sense of the word.

"People's argument, that 'I still buy tickets and t shirts and go to shows' is a valid one. All of us are eternally grateful for every fan's love and support, and much like test-driving a car, you should be able to try before you buy; but be aware that now record companies are demanding a huge chunk of that revenue (touring and merch), which used to be an musician's bread and butter, as a result. Again, there is a way to sample new music for free, and many bands (including us) offer samples of their music for free.

"We, as artists, love and appreciate our fans more than you know. We know that we could not exist without you, but we don't steal from you, not in any way, not ever. Wrong is wrong, no matter what color you paint it, or how you try to spin it.

"I am against [controversial anti-piracy bills] SOPA (Stop Online Piracy Act) and PIPA (Protect Intellectual Property Act), because they limit people's freedom of expression and freedom of speech, not because they are trying to protect the rights of artists everywhere. I truly do hope that they re-write the legilation and get it right this time so that the music consumer can continue to have access to the music they love, at a reasonable cost, legally; and without censorship and restricting peoples freedom to express themselves on the greatest arena of free speech and expression in existence, the Internet."

Thanks-Stay Metal, Stay Brutal-\m/ -l-