Megaupload founder will likely never go to trial, says US judge

Remember earlier this year when the New Zealand government and the US government conspired to send a SWAT team to arrest Kim Dotcom, founder of Megaupload, shut down the service, make 220 people unemployed, seize Dotcom's assets, and deprive millions of users of access to their files? Well now a US judge says that the trial against Dotcom will probably never proceed, because the US government didn't ever formally charge Dotcom. This wasn't a mere oversight, either. They were not legally allowed to charge him. TorrentFreak reports:

“I frankly don’t know that we are ever going to have a trial in this matter,” Judge O’Grady said as reported by the NZ Herald.

Judge O’Grady informed the FBI that Megaupload was never served with criminal charges, which is a requirement to start the trial. The origin of this problem is not merely a matter of oversight. Megaupload’s lawyer Ira Rothken says that unlike people, companies can’t be served outside US jurisdiction.

“My understanding as to why they haven’t done that is because they can’t. We don’t believe Megaupload can be served in a criminal matter because it is not located within the jurisdiction of the United States,” Rothken says.

Megaupload’s lawyer adds that he doesn’t understand why the US authorities weren’t aware of this problem before. As a result Judge O’Grady noted that Megaupload is “kind of hanging out there.”

TorrentFreak followed up their coverage with a furious interview with Dotcom:

If Judge O’Grady is to be believed all this damage could very well have been for nothing because the authorities simply can’t serve foreign companies. This could lead one to wonder whether the whole setup was to simply destroy Mega’s businesses.

This is certainly a theory Dotcom subscribes to, and it’s not the only dirty trick Megaupload’s founder believes the US Government is playing. The US is structurally denying Megaupload the chance to put up a fair fight.

“We are refused access to the evidence that clears us, we are refused funds to pay our lawyers, we are refused to pick the lawyers we want to represent us and have any chance for a fair trial,” Dotcom says.

For Megaupload the worst part is that the damage can’t be undone. The site has been completely destroyed as well as the plans to become a publicly traded company.

“We have already been served a death sentence without trial and even if we are found ‘not guilty’ which we will, the damage can never be repaired,” Dotcom says.

Megaupload Trial May Never Happen, Judge Says


  1. A rumor I believe to be true: the agents who raided the Megaupload offices in DC used Jack Valenti’s rigored corpse to batter down the door.

  2. I smell a lawsuit coming. I can imagine 100 sharks waiting to take that case, as the pay off would be huge.

    1. Prosecutors have absolute immunity in deciding whether and how to prosecute, and qualified immunity for investigative activities. Government agents in general also have qualified immunity. They basically can’t be sued unless they agree to be sued, and I don’t see that happening here, even though this is one of the biggest legal fuckups ever.

        1.  It’s not quite so cut and dried, so far as I can tell, but the broad effects are the same. The principle of sovereign immunity is the same. On the criminal side, NZ has private prosecutions as an alternative, but in cases like this it looks like the Crown Solicitor would have to sign off. There seem to have been many violations of the prosecutorial guidelines ( ) in this case, but those guidelines are not binding. It really seems to be up to the Crown Solicitor or the Attorney General whether to allow such a suit.

          Anyway, looking at lawsuits is getting ahead of the game. Mr. Dotcom himself can likely be served with charges, even if his corporation cannot. It’s a procedural error that might be resolved by restructuring the case.

          (I’m not a lawyer, let alone an NZ lawyer – though in a case this screwy, I doubt it would help if I were.)

          1. Mr. Dotcom himself can likely be served with charges, even if his corporation cannot. It’s a procedural error that might be resolved by restructuring the case.

            Extradition might be tough in this case. Assange has been staving it off under his 500 days of charge-free house-arrest, and I daresay he is even more hated by the US than MegaUpload.

      1. Unless you can prove malice in their actions.
        The lawyer who brought the indictment had a job prior to this one… BSA lawyer.
        If they violate the law so spectacularly they could get stripped of the immunity, because they violated the office they hold.

      2. The lawsuit would not be against NZ authorities, but perhaps the tangled web of the US request. If Dotcom gets his money back, he might have the juice to pursue this breach of international law.

  3. Recode the site! Start it up again! I was a heavy, heavy user of MU and I would take it back up again the INSTANT I knew it was available again.

  4. This is a case in which a corporation was carefully set up to avoid the wrath of US laws.

    Unfortunately, the US police don’t play by the rules. 

      1. Nixiebunny is just agreeing that acting not-in-accordance with US desires is a legitimate crime on a global scale.

  5. “This could lead one to wonder whether the whole setup was to simply destroy Mega’s businesses. ”

    Sure, but anyone who believe that is a tin-foil hat wearing muslimsocialistanarchist.

  6. “We have already been served a death sentence without trial and even if we are found ‘not guilty’ which we will, the damage can never be repaired,” Dotcom says.

    10 out of 10 plutocrats agree, corporations are people. This would be a wonderful test case for the premeditated murder of a corporation.

    1. Exactly. Mission accomplised, with the bonus prize of finding out that NZ is a willing tool to engage in malfeasance from the Obama Administration (and likely beyond).

      1. They already knew that of NZ, our government has been in (secret) negotiations with the US over the TPP for quite some time.

  7. I think they were going to use that raid to start off the post SOPA reality. A shakedown/scare tactic for Everyone to start toing the line because this was now perfictly legal.

    Except it didn’t work out that way. Yet even as the writing had to be on the wall that support was eroding fast too many calls were made. Too many arms were twisted to call it off.

    Sure the market has been chilled as a result, but instead of being a strong opener to the post-we-can-do-as-we-like-to-the-net world this has simply served to showcase what governments (with the entertainment industry giving marching orders) on what to do.

    Sure I don’t like infringing. I’d like to eventually write a few bits of software and maybe make some money off that work. However this… Just… It’s all wrong now.

  8. This is a sketchy story. I’m not sure you can even charge corporations criminally in the US. You charge the people who run the company, which is what is happening here, and the corporation’s assets could be seized in connection with the criminal complaint against its owners (maybe that’s where the serving of the corporation comes in?), or the corporation’s assets could be liquidated to pay off a civil claim against it. Note toward the bottom of the NZ Herald story that Dotcom et al. are planning to fight extradition by arguing that the crimes for which THEY ARE CHARGED are not covered in the US-NZ extradition treaty. Anyway, I think we’re missing some very significant legal context for the judge’s comments, and I would be interested in hearing what a disinterested attorney may have to say about this…

      1.  Its not that you cant charge a company with a crime its that you cant charge a FOREGIN company with a crime as its is out of there jurisdiction which is what happened here.

  9. $10 goes to the first company that can set up a server on the Moon. 

    THAT will provide the incentive to America to get back there… if only to kick in the hatch door and serve the droid manager legal papers.

        1. If its reachable by contractors, it reachable by the military. 

          Also, jamming wold probably be easy. 

          1. Only if they can find it. It’s a big moon. Drop something from an oblique orbit and if you don’t know where it is, you’re probably not going to find it.

          2. @boingboing-17d23e54aab31807fc9060d0d191161b:disqus While theoretically true the reality is if you can hear it’s transmissions then it’s findable. Might be difficult for amatures to do it but when you have the resource level of large corporations and or governments, it’s not nearly so hard. Plus they don’t have ot send a package up that survives on impact to shut you down. All they have to do is ‘woopsie, our latest probe to figure something out went splut. Sorry folks.’

    1. Since currently the jurisdiction for such an eventuality would fall under the country that shot the thing up there (and/or whose moonspace upon which the server is located), you’re still probably not going to escape the long arm of the US DoJ.

      Furthermore, such a server could be isolated (“seized”) by virtue of cutting off its communications links, its accessibility would be probably also US-encumbered either by nationality or treaty.

  10. If corporations can receive 14th amendment protection, then this would be a clear violation. But on foreign soil, anything goes I guess.

  11. This was only possible through the collusion of the NZ government.

    The logical lesson for people to take is to demand in writing a “no betrayal clause” from their own governments that clearly states they will not be sold to a foreign power.  This used to be a part of basic sovereignty and an expected right of citizenship.  Even if Dotcom is not a NZ passport holder, the people of NZ better take the lesson. Or they will be next. 

    Let’s see how they vote next time.

    1.  The larger part of NZ is politcally apathetic, and thanks to our biased media most really couldn’t care less about Dotcom. And I am not sure our collusion with the US was done entirely willingly on our behalf – we are, after all, an export based economy that could benefit out of any scraps the US government has lying around.

      1. I think Kim (whatsisname before he changed it to dotcom) made himself a target, but what happened here is, nevertheless, inexcuseable.

  12. If you’ve paid for things the MAFIAA are collecting rent on, you bear some responsibility for these actions.

    Do the right thing: use

  13. “For Megaupload the worst part is that the damage can’t be undone. The site has been completely destroyed as well as the plans to become a publicly traded company.”


    1.  Regardless of how you feel about the people who were using MU for infringing activities, the precedent set by the DOJ’s actions should scare the bejeebers out of anyone who’s paying attention.

        1. Good luck proving it when you’re homeless because they took away all you own before the trial. If there is a trial. If they don’t just arbitrarily keep you in jail.

  14. MotherTrucker!!!
    You know why they did it?  Not because they legally can, but because they physically can.  This is unfortunately the norm in the current Not-So United States…   The only difference between this abuse and the police abuse in the US is that it was done on another countries soil.  That also can be seen as a similarity, they didnt have a right to go out of their country and affect arrests but they did it and then didnt charge.  They arent allowed to violate human rights at a traffic stop but they do, under the guise of safety or the drug war.  They arent allowed to tap people without warrants but they do, because supposedly its ok to tap someone as long as its not for a criminal case.  The law says for it to be admissible in court it must have a judges approval, but if it will never be used in court…..they can do what they wish.   Same here, they did what they wanted, slandered people, arrested people, shut down a site, confiscated millions of information that was NOT THEIRS, all for what? 

    If you cant beat em, find a way to mess with them enough until they are broke or until they give up.  Same things been happening for years all over America, I guess its more profitable to go after bigger targets instead of fleecing the general population who are clearly unable to support the governments revenue habit.

  15. Sorry I’m at a bit of a loss here.  This extremely dubious guy who has been convicted of computer fraud, handling stolen goods, insider trading and embezzlement founds a company that is very publicly used for illegal (yeah, yeah, there’s legal uses too but c’mon let’s be honest here) file storage, which they in turn were collecting money for and somehow all these job losses are the US government’s fault?!?!  I’m usually the first to jump to the defence of the illegal downloader and last to defend the government (and I certainly wouldn’t defend the whole US in NZ thing) or sopa or pipa or etc etc but I just can’t see how this guy is worth defending.  He isn’t some noble copyfighter, he’s a common criminal.

    Maybe I’m wrong and someone can explain to me why this guy is worth defending…

    1. Because quite frankly while he was/is a fraudster, he isn’t in this particular case, and more importantly, this sets up one hell of a nasty precedent. Got a company that US doesn’t like, be it for copyright or other reasons, but it isn’t actually doing anything you can go after them with? Go ahead and shut em down! It’s not like anybody that REALLY matters is going to seriously call you out on it, and due to how government immunity to being sued works your almost untouchable anyways! It’s disturbing how easy it is for the government to just say “Screw it! We’re doing it anyways, and fuck whoever says we can’t!” Remember if it can happen to him, what’s stopping the Powers That Be from making it happen to you if you happen to displease them in some way?

    2. The actions of both sides seem equally dubious in creating innocent victims, but I was not aware that entitlement to a defence was a matter of worth.

    3.  When I was a baby union rep many years ago it was explained to me thus:

      If you don’t defend all the skivers and drunks they’ll get rid of them and then they’ll start picking on the next level of people… the ones who don’t dress neatly or whose faces don’t fit.

      To which we might add that the logical conclusion of your argument is that criminals once convicted of one crime may be safely assumed to be guilty of every other crime they are accused of without due process. I think you’re smart enough to work out where the problem with that is without it being explained to you.

      1.  Exactly…the People vs Larry Flynt springs to mind. The law needs to protect dirtbags as much as anyone else. If the law isn’t equally applied….well, then it can hardly be part of a system of “justice”.

    4.  Oh, you are quite right. Kim Schmitz (like hell I’m gonna call him “Dotcom”) is a thoroughly reprehensible douchebag.
      But in this case… that simply doesn’t matter. This is about something bigger. Whatever Schmitz has done before (and he has done many things) – Megaupload’s business was NOT illegal under national NZ laws.
      Seriously, this is where a fucking line needs to be drawn. The World is not America’s fucking backyard.

      1. As an American who loves his country deeply.

        I salute you for words that need to be said. Constantly.

    5. Maybe I’m wrong and someone can explain to me why this guy is worth defending…

      Has it occurred to you that people are defending the rule of law?  Should you lose your legal rights because your neighbors don’t like you or agree with you?

      1. Yes, yes, yes. You may not like Kim Dotcom one bit. But you damn sure should be standing up and shouting to the roof tops about a “legal process” that allows the government to do to a person what they have done to Dotcom.

    6. Sorry i apologise. I don’t think I worded that well and I think I’ve been misinterpreted (although I did state that I don’t agree with the us interference in nz so i don’t know why replies suggested otherwise). When I say “worth defending” I didn’t remotely mean in the criminal justice sense and I should have been clearer about that. Of course i think they deserve legal defence and that his past shouldn’t effect that. What I meant was more about how I get the impression too often around this case (and I suppose I should admit this is personal opinion) that people are defending megaupload as being more than just a site that was mostly used for piracy and took money for better access to such files as opposed to say a free torrent site that didn’t host them. As such I’m suggesting that people who took jobs in such a company headed by such a guy should have accepted that sooner or later the company would run in to problems and that blaming the us government is a little unfair. I accept that their interference was wrong (and that it sets yet another worrying precedent about us ideas on international law), that it brought about this earlier than they might have expected and that they should have the right to defend their company in court (and yes it’s terrible that people list their jobs and that actual legitimate customers lost files) but surely they saw that something was going to happen eventually. What I guess I’m trying to say is that I wanted someone to explain, given my assumptions about the majority of usage of the company, why Kim and megaupload are deserving of defence of being legitimate and noble and unfortunately that isn’t really what the original post was about so I apologise again.

      1. Its not about whether this dude and his company are “legitimate and noble”. Its a question of due process:  did he commit any crimes and if so, there is a process that must be followed to ensure that these crimes are provable and that he is actually guilty.  The judicial system exists for this reason.  By destroying his business prior to his guilt being proven in a court of law, he suffered destruction by a police squad that acted as judge, jury and executioner.  In effect, the accusation was the final determination of guilt, and punishment was immediate.  

        Imagine if, after BP destroyed the Gulf of Mexico, rumors came out that they were criminally negligent in cutting corners which led directly to the disaster.  If the government had, at that point, taken possession of every asset that BP owns worldwide, fired all of their employees, essentially destroying the company, it would have been equivalent to what happened in this case.  BP would, of course, demand a trial before the rumors could be taken as fact, and would demand that restitution be in some way proportional to the damage caused.  Of course, because BP has powerful friends it did not suffer anything remotely like this and has, in fact, been forced to pay a puny $20 billion to cover all of the damages caused by the spill.  I say its puny because destroying the Gulf and all of the livelihoods that depend on it, not to mention a priceless and massive ecosystem, is, well, priceless.  Even if BP had been forced to pay all of its future profits for the next 50 years it would not fix the problems it caused.  Yet BP still exists, and hasn’t even been forced to change its business practices, let alone face criminal prosecution of any kind for its criminal acts.  

        The world you are defending is one where might makes right, there is no such thing as justice, and government can and will take anything they want from anyone they feel like it, on the merest unproven assertion that crimes were committed.  Its called inverted totalitarianism.  

        Its totalitarianism because the people have no rights and there is no law that will protect you from government abuse, destruction of livelihood and even murder.  Its inverted because the government is the lapdog of powerful private interests and exists to do their bidding.  This is, in fact, the current system in the USA, and has led directly to acts like the Megaupload travesty.

        1.  You, sir, win the internet this day. You very nicely summed up the problem with this case. Next time someone buys you a beer, imagine it’s from me.

        2. (OK I’ll try to keep this short and to the point since I’m clearly not going to be able to explain my original query)

          Wow.  I quite genuinely completely agree with everything you are saying and thus I’m astonished that it is being used to disagree with me since I stated “I didn’t remotely mean in the criminal justice sense”.  I never at any point said that they don’t deserve due process  (see: “they should have the right to defend their company in court”) and  I also never said that the staff deserved to lose their jobs.  I also stated, I feel quite clearly, in both posts that I don’t agree with how the US have interfered in this matter.  How my comment is being interpreted as support for “inverted totalitarianism” I don’t know.  So as such I’ll just say sorry again and clarify two points I’ll take from this:

          1) I should have said “OFF TOPIC” at the start of the original comment and from now on I’ll remember on the internet that unless my comment is strictly referring to the exact content of the original post I shouldn’t meander off into only slightly related subjects questioning some of the people involved.

          2) I never should have used the word “defend” as in my “worth defending” comment since clearly there is only one possible interpretation of that word and that is strictly with regards to legal connotations.  Obviously if I asked “Why is fish flavoured ice cream worth defending?” I mean that anyone who likes fish flavoured ice cream deserves to be arrested, put in prison and not be allowed any contact with the justice system.

          Sorry for the sarcasm.  (Bloody record store day yesterday has made me tired)

          Maybe I would have been better to just have stuck to purely mythical* based questions and posted this:

          “[OT] Why are people making out that Kim and Megaupload are like Robin Hood and his Merry Men? They are not.”

          Sorry again. Clearly short and to the point didn’t work after my fingers hit the keys.  I am not Concisemouse.

          (*I say “mythical” because, whilst we’re being completely specific here, you might have thought that I meant the hypothetical Robin Hood comment “historically” and, of course, in reality John signed the Magna Carta and I wouldn’t want people to think that my comment meant that I didn’t agree with habeas corpus)

          1. Sorry, me again.  Can I just state here that after reading my above comment again that I think that “I am not Concisemouse” is a great name for a band or album (or, obviously, tumblr if you read the right comics and let’s face it, you do).  You can have that one on me.

          2. “[OT] Why are people making out that Kim and Megaupload are like Robin Hood and his Merry Men? They are not.”

            The word ‘they’ in that sentence is a bit ambiguous. I suspect you mean it to refer to Kim .com & MU not being merry men.

            They rest of us are reading it as the people supposedly sticking up for Kim .com & MU.

            The second interpretation will help you understand why you’re getting a pile on. no one is particularly defending Kim .com and MU as the kind of person one would like their daughter to bring home after a date, and your repeated attempts to imply that is the case is a rather feeble strawman.

            For the record:
            Kim .com is a douche.
            Kim .com has comitted various crimes and misdemeanors in the past.
            MU was used by users for infringing behaviour.

            To date everyone using MU has lost everything they had stored there.
            Not everyone using MU was using it to infringe.
            A lot of the material seized – and under imminent risk of deletion – was NOT infringing material. In fact, the only material that is not at imminent risk is a selected portion which supposedly shows infringing behavour. In a few days time it could be literally true that “all material on MU servers is infringing material (because we deleted all the other stuff)” 
            In this particular case Kim .com and MU had done nothing wrong – or ilegal – in the relevant jurisdiction.

            “We had to burn the village down to save it” has never been a very sound justificaiton.

  16. The Assistant US Attorney who brought this indictment, Neil H. Macbride, came to that position from his former job at the Business Software Alliance.  It would not be unfair to say that in this matter he is still representing their interests.  If that’s not illegal, it should be.

    1. There could be no problem with that at all…  I mean its not like we have a former RIAA lobbyist as a sitting judge now making rulings in mass john doe torrent cases, saying crazy things like the Doe’s have no right to try and stop the release of their personal information to a company who will not take them to court and just wants to  harrass them into paying money all based on a single IP address…. oh wait… we do.

  17. If Dotcom and his people aren’t charged and never go to trial, couldn’t they just buy more computers and start Megaupload again? Maybe they could get donations via PayPal!

  18. Instead of trying to get along, the U.S. continues to be the neighborhood bully, and maintains a military which can handle any confrontation, even though it cannot afford the cost.  Perhaps it would be better to stop pushing the points-of-view of its corporations, which claim no allegiance except to next-quarter profits, and try to behave more as a global citizen. If the bully would go away, there would be no need to maintain such an unsupportable defense.

    Of course, the bully can never accept that idea, whether we are talking about The War On Drugs, The War On Terrorism, The War On Poverty, or any other War which gives the powers-that-be an opportunity to dance around common sense.

  19. Let me try to clarify something here.  A lot of comments seem to take the position that this is an overreach by the US because  MegaUpload didn’t violate US law.  Not true.  MegaUpload certainly did.  All sorts of activities committed in foreign countries are violations of US law, and it’s hardly an overreach for the US to criminalize behavior that is targeted to consequences in the US (by allowing US IPs to download copyrighted material).  For example, say a crime lord in Mexico sends dealers into the US to sell drugs.  Should the US be able to charge him criminally, even though he’s never stepped foot in the US?  Of course!  I think some commenters are condemning the idea of US law reaching beyond the border because they don’t like the substance of the law.  If you don’t like the substance of the law, just say so.  Don’t throw the baby out with the bathwater.

    Anyway, the US has the authority under US law to charge MegaUpload criminally.  What it lacks is the power, as a PRACTICAL matter, to follow through with it.  That’s what the judge refers to the fact MegaUpload can’t be “served.”  Insufficient service of process is a jurisdictional defect – US courts can’t hear the matter unless the defendant is properly served.  That’s a limit the US legal system puts on itself.  But this defect has nothing at all to do with whether whether MegaUpload broke US law.

    1. Actually it’s arguable whether even US law was violated here.  MU hired some of the best IP law firms who told them what they did was legal (and can cite case law to support their opinions).  

    2. Clearly what the US doesnot lack is the power to irreparably destroy a business and create a cascade effect among similar businesses in order to further its own archaic and corporate-funded agenda.

  20. Damn you USA, just hurry up and give up a fair trial already! We do not want to repeat    Stalin’s atrocities. Rise 12 million strong show America that Megaupload’s shutdown was an act of injustice done by the USA. This Megaupload Shutdown after SOPA burial was not a coincidence, it was a set up done by Hollywood and MPAA as a way for ends to meet. The forces of Voltaire, Beccaria, and Hugo Grotius shall side with Kim with his battle against Machiavelli and tyranny. 

  21. Jurisdictional law exists for substantive reasons, too.
    Wikileaks has yet to be charged with any violation of any law of any nation on earth; yet it’s been effectively destroyed. 
    Legal technicalities are now all that’s keeping Assange from either 1) a trial in which the death penalty is a possible outcome or 2) indefinite detention, if the U.S. isn’t sure they can win at trial (Manning was imprisoned for two years without even being charged, despite continuous public outcry, much of that time under conditions amounting to torture).

  22. uh, so, no legally obtained warrant but you say you do have tactical-nuclear, Inter Continental Ballistic Missiles and the ability to crush our country’s economy… hmmm. let me just check with the boss.

    1. I suspect that it might have more to do with China’s recent decision that their territorial waters extend to the middle of Nebraska. Australia’s certainly gotten extra-chummy with the US lately.

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