Megaupload Takedown Questioned By Users, Lawyers
informationweek.com
informationweek.com
> (1) It’s wildly under-appreciated how unrestrained is the Government’s power to do what it wants, and how little effect these debates over various proposed laws have on that power. Contrary to how it was portrayed, the Obama administration’s threatened veto of the NDAA rested largely on the assertion that they did not need a law vesting them with indefinite detention powers because they already have full power to detain people without a trial: not because any actual law expressly vested that power, but because the Bush and Obama DOJs both claimed the 2001 AUMF silently (“implicitly”) authorized it and deferential courts have largely acquiesced to that claim.
> That’s more or less what happened with the SOPA fight. [It] sends a very clear message when citizens celebrate a rare victory in denying the Government a power it seeks - the power to shut down websites without a trial - only for the Government to turn around the very next day and shut down one of the world’s largest and best-known sites. Whether intended or not, the message is unmistakable: Congratulations, citizens, on your cute little “democracy” victory in denying us the power to shut down websites without a trial: we’re now going to shut down one of your most popular websites without a trial.
> (2) The U.S. really is a society that simply no longer believes in due process: once the defining feature of American freedom that is now scorned as some sort of fringe, radical, academic doctrine. That is not hyperbole. Supporters of both political parties endorse, or at least tolerate, all manner of government punishment without so much as the pretense of a trial, based solely on government accusation: imprisonment for life, renditions to other countries, even assassinations of their fellow citizens. Simply uttering the word Terrorist, without proving it, is sufficient. And now here is Megaupload being completely destroyed — its website shuttered, its assets seized, ongoing business rendered impossible — based solely on the unproven accusation of Piracy.
It was proven to a grand jury -- that's why they (and not the government) handed down an indictment.
The treatment is actually similar to what would happen to the brick-and-mortar assets of an indicted meth distributor. Normally when a grand jury hands down an indictment then business functions that aid the alleged criminal activity also get shuttered. See http://www.nwitimes.com/news/local/lake/hammond/feds-e-c-com... for instance.
When the police decide to arrest someone it's commonplace for all evidence related to the crime to be taken in as well. The fact that said evidence is needed for continued operation of your business is, sorry life's not fair, sucks to be you.
If you're a kinkos accused of committing a heinous crime with your copy machines and they need to take the copy machines as evidence oh well sucks to be you.
If you're a baker accused to knocking people on the head with your rolling pins, oh well no more rolling pins until case is resolved.
If you're an internet company accused of massive piracy and they take the servers, oh well sucks to be you.
I really do not think it is a constructive argument.
Break the law and the police are going to take your stuff. If you used that stuff for your business oh well sucks to be you.
You may think that is a bad system and have some great ideas for liberating us from the bad police but those ideas are no more valid or invalid today then they were 5, 10, 20, 50 or 100 years ago.
Substitute "be accused of breaking the law" for "break the law".
Yes, the police and prosecutors have that kind of discretion.
And no, grand juries are not a significant impediment. As the saying goes, a grand jury will indict a ham sandwich.
He also noted that a grand jury had been impaneled and indicted Megaupload (along with six individuals) and a judge had issued a warrant.
So, it wasn't just someone at the FBI or DOJ. It was a grand jury in the Eastern District of Virginia that indicted them. It is being prosecuted by a US Attorney. More than 20 search warrants were issued in nine countries. It was investigated by the FBI, the New Zealand Police, Hong Kong Customs, the Public Prosecutor's Office in the Netherlands, London's Metropolitan Police, the German Public Prosecutor, the Royal Canadian Mounted Police, and others. Megaupload and the named individuals will have a public trial.
I'm not saying that you should like it, but it is different from "feeling a lot like Russia". There's a certain amount of secrecy that happens in a criminal investigation to prevent those being investigated from being able to hide what they're doing (if they're doing something wrong).
I definitely had your reaction when I found out that the site was down and they hadn't had a chance to defend themselves. I think most of us see this as a civil offense - in which case, the seizure might not be justified (I use "might" because I'm not a lawyer). However, if you look at criminal offenses (bank robbery, drugs, gun running, art theft, etc.) you wouldn't expect the accused to keep that property pending trial.
We'll see how this plays out. If you don't believe what they did should be a criminal offense, even if they're "guilty" of it, you're not going to agree with any of what the governments are doing. You're going to think that they should be sued similar to what happened to YouTube and have the chance to defend themselves while operating. That's an argument to change the law and you won't be satisfied by the process no matter how above board it is. And I'm not saying that you're wrong - Megaupload does seem a lot more innocuous (even if wrong) than what we generally consider racketeering or conspiracy. I mean, if Megaupload continued, you're not going to have some kid getting addicted to crack on the street or gangs getting guns and causing violence in the community - some rich media company potentially loses a little profit. And I think that reality makes a strong argument that maybe seizure wasn't necessary. However, it's also important to know that there was a lot of due process in a lot of jurisdictions with a lot of different law enforcement working together on this one. It wasn't just seized because some unanswerable someone in a random agency decided they wanted to. Likewise, there will be a trial.
Further, I'm making no claims about whether megaupload's conduct should be criminal; I'm merely claiming that permitting unaccountable people to destroy companies before any conviction or before megaupload has had any chance to defend itself is bullshit.
So no, there wasn't anything like real due process.
[1] "As a practical matter, a federal grand jury will almost always
return an indictment presented to it by a prosecutor. This is the basis
for Judge Saul Wachler's famous saying that a prosecutor can get a
grand jury to 'indict a ham sandwich.'" — Solomon L. Wisenberg,
"Federal Grand Jury Crash Course"
http://www.wisenberglaw.com/White-Collar-Criminal-Defense/Grand-Jury-Investigations.shtmlHowever there's no indication that's what's going on here. Every indication is that this business knew exactly what they were doing at the highest levels.
Just trying to figure this out..
Ever since 9/11, this whole culture of not following the Constitution, or trying to exploit the loopholes in the laws, has formed. There's no spirit of the law anymore. Now authorities try to find the smallest possible potential loophole to do whatever they want to do.
Just look at the GPS tracking issue, which normally you'd think should be illegal. But it took a 9-0 Supreme Court decision to make that clear for the authorities. At this rate, the Supreme Court will be overwhelmed with the number of overreaches by law enforcement that they'll have to decide on.
If that were the case it's likely the government gained access from a MU employee they leaned on (there are redacted MU conspirators from the indictment who are apparently not presently being charged meaning they may have been cooperating).
What's more likely it seems is that these emails were sent internationally and the government (armed with a warrant hopefully) used their backdoors to access them. The arrests were apparently timed to conincide with many of the international employees being in NZ for KDC's birthday.
Do you really think that MegaUpload generated 175MM from a few users signing up to a paid account, and from ads and scams that were displayed on URLs with legit content.
If 95% of their revenue came from copyrighted material being shared (without permission), then I'd say MU was a criminal enterprise and what happened was completely okay.
If 5%, than not okay.
The supporting evidence so far points to the former figure.
I always love the logic of forcing someone to pay to defend themselves in court but the government takes away your assets so that you are unable to pay for your defense.
The whole reason it's a debate is because if we, as citizens, don't watch our government closely when they make controversial moves like this, it easily becomes a very slippery slope. If we let our government get away with something like this, where will it end? Soon, will unwarranted search and seizure will be OK for the FBI, so long as they're after "pirates?" Will we end up like Iran who can execute a programmer 'cause they said so?
Yeah, those are extreme examples, but the reason it is such a slippery slope is because our court's decisions are largely ruled by precedence. If the courts declare the actions taken against MegaUpload legal, it's pretty much "anything goes" for the FBI and DoJ to attack future, perhaps less piracy-oriented or even completely legitimate companies. All the DoJ or FBI has to say is "see, you let us do it last time with MegaUpload."
I'm still confused on why you're confused. MU was distributing copyrighted material around the globe.
The US gathered evidence, presented that evidence to its partners, partners made the arrest.
It's a global network, there are various treaties, and there is cooperation.
Welcome to the new democracy.
Not to defend MU here. Just don't think all that many people felt the harm for what they were doing. And if you ask artists, they will probably point you in different direction.
We all know that the west side of the Chicago is the place to go to buy drugs. That must mean that everyone living west of Halsted Street is a drug dealer and should be put in jail without a trial.
My guess is from this point we will never know the real unbiased numbers, not matter who wins.
Edit: to clarify tone.
Your company looks very suspicious, just look at all these words I wrote down that show you just how suspicious it is.
The words I wrote down are so suspicious, I'm going to take your house and all your money. You can start issuing your own words to get it all back in a few months while I get paperwork ready to keep it from you permanently. Trust me, I'm going to win, I promise. If I didn't think so, would I have taken your house and all your money?
When did we end up in a society where "Do you really think..." is sufficient for judge, jury, and execution?
The fuss is not about megaupload. The fuss is about the MPAA and the RIAA teaming up with law enforcement to make sites and businesses that they don't like disappear from the internet, without due process.
It's been said before, but your whole post describes pre-google youtube. The only difference is they didn't use ads. It's worth noting, the charges against megaupload have nothing to do with any dirty business using ads.
Since when is "equipment subpoenaed via grand jury indictment" not due process? I'm all for arguing if what's happening should/should not be allowed, but let's at least get the facts straight on "what's happening" first.
Indeed your quick analysis is true: MegaUpload was a platform to download copyrighted things over the internet.
But there is a greater principle at play: when should action be taken? The way it is done in democracy and countries where liberty is valued is that the action taken is done after due process. Also and I think this is pretty damn important there are international rules in terms of law and what can be done. Citizens of other countries should have the right to benefit from the law in vigor in their country without the US interfering with them. The US is not all saint and sometimes take poor decisions that cost the business, health or life of some people, especially when the problem comes from private interests.
Anyway if you allow authorities to take action without due process you end up in dark dark world where arrests become arbitrary. There were plenty of evidence that MegaUpload business was not legit actions could have been taken legally, but probably bribes came into play and short-circuited the whole thing. This becomes rampant in the US (Bradley Manning anyone ?) and it has to stop before it's too late.
-There was no trial (and probably will not matter because their site has already lost all its traffic and revenue)
-It is not a US based site
-The majority of its traffic did not come from the US
-There is not much evidence that that they were doing anything illegal by US law. They had a system in place (such as youtube) to remove copyright infringing content if found.
The fact that the majority of their traffic came from pirated content (I am just assuming, no facts) is irrelevant. I am pretty sure that if the media companies put as much effort into reporting copyright violating content on Megaupload as they do on youtube, it would have none.
> -Megaupload never got to state their case
> -There was no trial (and probably will not matter
> because their site has already lost all its traffic
> and revenue)
> -It is not a US based site
> -The majority of its traffic did not come from the US
> -There is not much evidence that that they were doing
> anything illegal by US law. They had a system in place
> (such as youtube) to remove copyright infringing
> content if found.
> I am pretty sure that if the media companies put as
> much effort into reporting copyright violating content
> on Megaupload as they do on youtube, it would have none.
The government is claiming that MegaUpload purposefully restricted the number of takedowns because they knew that they needed the infringing material to bolster their growth (and allowing all infringing files to be taken down would hurt them).
I agree with your comment. However I would understand due process as process that seems to be fair and just, not something legal. Because if tomorrow the government says by law that part of the trial is to kill the culprit before the trial that would be legal in regards to the law but not in regards to the basic human principles. I know the example is extreme but I hope you see my point on the matter. In that case even before the trial the parties are punished and destroyed: no presence anymore on internet, no servers, no domain names. It certainly feels like somebody is punished even before the trial, no?
Also the fact that the FBI (FEDERAL) has power to seize or take things oversea is seriously worrying. I believe there are more urgent matters that needs to be taken care in the united States by the FBI before investigating that. This is a result of the PATRIOT Act. Great!
To sum up I believe that MegaUpload profit came massively from copyright infringement but even the worst killer should have his rights guaranteed.
The Internet's reaction to these events seems really knee-jerk. Okay, the Megaupload case might have been a horrible abuse of government power. But right now it seems like a routine takedown of a business that supported itself mostly through illegal activity. This is standard operating practice from long before Internet piracy was a thing.
So let's not make a big deal about something which might have been bad, but we have no reason to believe it actually was. If Megaupload turns out to be completely innocent, I'll join the bandwagon. But the grand jury indictment is so damning, it would really have to turn out to be mostly lies.
Meanwhile there are real government abuses, such as the indefinite detention of terror suspects. Can we talk about those instead?
No, I think they made money from a LOT of users signing up for paid accounts. I know lots of people that did so, Megaupload is widely used by professionals in the video, music, graphics and games industries for transferring and distributing large files at low cost legally.
I find it highly unlikely that those engaging in illegal activity went in and gave their traceable credit card information to get accounts for illegal activity. That may have happened, but it seems obvious that users doing illegal stuff, particularly those involving stealing things because you don't want to pay, are not highly likely to be creating easily traceable financial connections between their illegal activity and their real identities.
File sizes are large nowadays and millions of people and teams work remotely. There is a tremendous need for locker sites with large file capabilities, reasonable usability, and low cost. Megaupload provided a good technical solution and price to a strong need in modern business and this is why they were successful. People paid them because people have large files they need to work with and distribute. Completely separately from illegal use.
Any company that allows uploading of material is going to have this problem. Legislation such as DMCA was supposed to protect business from copyright violation liability when the infringement was committed by third parties as long as they followed the takedown process. Now we find that DMCA does no such thing, and businesses are beginning to shut down or drastically limit file hosting services. This is creating serious problems for tens of thousands or more of legitimate users and is harming legal businesses that benefit from locker file hosting services.
Except that the indictment states that MU had only a few paid users and was largely ad supported... And I could have sworn that before all this happened, MU said the same thing.
> Legislation such as DMCA was supposed to protect business from copyright violation liability when the infringement was committed by third parties as long as they followed the takedown process.
DMCA didn't protect MU because they refused to delete the actual files (they only deleted some of the links pointing to that same file), and actively ignored DMCA takedown notices that did not come from major US parties.
It would be nice if there was a more detailed break down but the breakdown given does not support claims that subscription income was inconsequential. I wonder, had you actually read the complete indictment, or were you just relying on summaries from other web sites. Sometimes summaries are not accurate or don't give the whole picture. Then again, perhaps I missed a more detailed breakdown elsewhere, if you have it please reference it by specific item number within the indictment. Thanks.
This still does not help MU if the signup originally came after a user visited a page with illegal content, and signed up to be able to get that content or to partake in sharing illegal content and get bounties on it....
Which would all be easy to check by taking a small sample of the logs and seeing what's what.
Though it does help MU if it can be shown those were all legitimate users.
Aside from that, the indictment is still very damning on other points. Even if the revenue was mostly legit, the primary driver to that revenue and the way MU conducted itself looks to be questionable at best.