Megaupload Boss Loses Extradition Appeal

Controversial file sharing site owner Kim Dotcom has come another step closer to being extradited to the United States. It comes despite a New Zealand court agreeing with one of Dotcom's key arguments against extradition.

Dotcom, who changed his name from Kim Schmitz, was the man behind one of the biggest alleged piracy websites, "Megaupload." It was a site where users could upload files, either as a form of back-up, or as a way to share files with other people.

Not surprisingly, many users found that Megaupload was an excellent way to illegally share copies of copyrighted music and videos. That in itself didn't inherently make the site illegal or constitute unlawful activity on Dotcom's part.

However, US prosecutors argue that Dotcom essentially urged users to engage in file trading (illegal or not) and in return, generated revenue from it. That's because Megaupload offered financial bonuses to users who shared the most downloaded files, with the logic being that the site could make the money back from advertising shown on the download link page.

Bonus Payment 'Encouraged Piracy'

Dotcom argues this was perfectly legal because he couldn't control whether copyright infringing files turned out to be the most popular. The prosecutors say he was well aware this would be the case and that paying the bonus was enough to make him complicit in the illegality.

New Zealand police arrested Dotcom five years ago, sparking a lengthy series of court battles about the legality of his arrest, the seizure of his assets, and the desire of US officials for him to be extradited to stand trial.

In late 2015, a New Zealand court finally ruled that he should be extradited, which promoted an immediate appeal by Dotcom. That's now concluded with something of a double-edge ruling.

Online Piracy Not Crime in New Zealand

On the one hand, the judges agreed with Dotcom's argument that extradition on copyright infringement charges was invalid. That's because the activity cited in the extradition request is not illegal in New Zealand. Normally people can only be extradited when accused of something that's a crime in both countries. (Source: bbc.co.uk)

However, the judges also noted that the extradition request include claims that Dotcom had conspired to commit copyright infringement, which in turn counted as conspiracy to defraud by deliberately and dishonestly depriving the copyright holders of revenue. That was enough for the court to conclude the extradition order was indeed valid. (Source: govt.nz)

Dotcom won't be packing his bags yet, however. The case is now likely to go to a further appeals stage and then to New Zealand's Supreme Court, something that may take up to two years.

What's Your Opinion?

Do you think Dotcom has acted illegally? Do you agree with his argument that it's not his responsibility how people used his service? Does the fact that he paid the bonuses for popular content make a difference?