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MegaUpload.com Shut Down by Feds

File-sharing website, MegaUpload.com has been shut down effective Janaury 19th, by federal prosecutors claiming that the website has violated piracy laws. The website, founded by entrepreneur (and convicted criminal) Kim Schmitz, was until being shut down, the #1 file sharing website. Much of its revenue was made from performance-based and affiliate marketing advertisements placed on the website, providing one of the top display sources for the industry.

The indictment accuses the site of being actively involved in costing over $500M in lost revenue from pirated films and other content. Seven people were named in the complaint, and four people have already been arrested. They have been charged with a variety of crimes including piracy, conspiracy to commit copyright infringement, money laundering and even racketeering (organized crime).

The three people arrested, were arrested outside the United States by New Zealand Police, who arrested them based on provisional arrest warrants.

Megaupload had high-profile support from celebrities, musicians and other content producers, including Kim Kardashian, Alicia Keys and most famously Kanye West. The acting CEO of the company was revealed to be, just today, before the announcement of the prosecution, Swizz Beats, the husband of Alicia Keys.

In response to these allegations, the company has said “The fact is that the vast majority of Mega’s Internet traffic is legitimate, and we are here to stay. If the content industry would like to take advantage of our popularity, we are happy to enter into a dialogue. We have some good ideas. Please get in touch.”

What makes this lawsuit interesting, is that despite enormous protests on the 19th against laws that addressed this, it seems that government is shutting down websites without court orders, based on accusations, effectively preventing them from continuing operations.

Flavorpill.com pointed out,

It will be interesting to see how this drama shakes out. Megaupload has already filed a countersuit against UMG. Obviously, if Universal is successful, similar file-sharing sites are sure to be fair game for legal action. Meanwhile, we can’t help thinking that this is major labels’ way of punishing all of us for hating SOPA.

Additionally, New Zealand Police and the FBI raided the NZ Home of Schmitz, and seized loads of property, including a Lamborghini and MiniCooper. (Wonder which one he drove?)

Here’s the full list of seized goods, not counting bank accounts:

  • 2010 Maserati GranCabrio, VIN ZAMKM45B000051328, License Plate No. “M-FB 212” or “DH-GC 470”, registered to FINN BATATO;
  • 2009 Mercedes-Benz E500 Coupe, VIN WDD20737225019582, License Plate No. “FEG690”;
  • 2005 Mercedes-Benz CLK DTM, VIN WDB2093422F165517, License Plate No. “GOOD”;
  • 2004 Mercedes-Benz CLK DTM AMG 5.5L Kompressor, VIN WDB2093422F166073, License Plate No. “EVIL”;
  • 2010 Mercedes-Benz S65 AMG L, VIN WDD2211792A324354, License Plate No. “CEO”;
  • 2008 Rolls-Royce Phantom Drop Head Coupe, VIN SCA2D68096UH07049; License Plate No. “GOD”;
  • 2010 Mercedes-Benz E63 AMG, VIN WDD2120772A103834, License Plate No. “STONED”;
  • 2010 Mini Cooper S Coupe, VIN WMWZG32000TZ03651, License Plate No. “V”;
  • 2010 Mercedes-Benz ML63 AMG, VIN WDC1641772A608055, License Plate No. “GUILTY”;
  • 2007 Mercedes-Benz CL65 AMG, VIN WDD2163792A025130, License Plate No. “KIMCOM”;
  • 2009 Mercedes-Benz ML63 AMG, VIN WDC1641772A542449, License Plate No. “MAFIA”;
  • 2010 Toyota Vellfire, VIN 7AT0H65MX11041670, License Plate Nos. “WOW” or “7”;
  • 2011 Mercedes-Benz G55 AMG, VIN WDB4632702X193395, License Plate Nos. “POLICE” or “GDS672”;
  • 2011 Toyota Hilux, VIN MR0FZ29G001599926, License Plate No. “FSN455”;
  • Harley Davidson Motorcycle, VIN 1HD1HPH3XBC803936, License Plate No. “36YED”;
  • 2010 Mercedes-Benz CL63 AMG, VIN WDD2163742A026653, License Plate No. “HACKER”;
  • 2005 Mercedes-Benz A170, VIN WDD1690322J184595, License Plate No. “FUR252”;
  • 2005 Mercedes-Benz ML500, VIN WDC1641752A026107, License Plate No. DFF816;
  • Fiberglass sculpture, imported from the United Kingdom with Entry No. 83023712;
  • 1957 Cadillac El Dorado, VIN 5770137596;
  • 2010 Sea-Doo GTX Jet Ski, VIN YDV03103E010;
  • 1959 Cadillac Series 62 Convertible, VIN 59F115669;
  • Von Dutch Kustom Motor Bike, VIN 1H9S14955BB451257;
  • 2006 Mercedes-Benz CLK DTM, VIN WDB2094421T067269;
  • 2010 Mini Cooper S Coupe, VIN WMWZG32000TZ03648 License Plate No. “T”;
  • 1989 Lamborghini LM002, VIN ZA9LU45AXKLA12158, License Plate No. “FRP358”
  • 2011 Mercedes-Benz ML63, VIN 4JGBB7HB0BA666219;
  • Samsung 820DXN 82” LCD TV;
  • Samsung 820DXN 82” LCD TV;
  • Samsung 820DXN 82” LCD TV;
  • Devon Works LLC, Tread #1 time piece;
  • Artwork, In High Spirits, Olaf Mueller photos from The Cat Street Gallery;
  • Sharp 108” LCD Display TV;
  • Sharp 108” LCD Display TV;
  • Sony PMW-F3K Camera S/N 0200231;
  • Sony PMW-F3K Camera S/N 0200561;
  • Artwork, Predator Statue;
  • Artwork, Christian Colin;
  • Artwork, Anonymous Hooded Sculpture;
  • 2009 Mercedes-Benz ML350 CDI 4MATIC Off-Roader;
  • Sharp LC-65XS1M 65” LCD TV;
  • Sharp LC-65XS1M 65” LCD TV;
  • TVLogic 56” LUM56W TV;
  • Sixty (60) Dell R710 computer servers.

 

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Pesach Lattin

Pesach "Pace" Lattin is one of the top experts in interactive advertising, affiliate marketing. Pace Lattin is known for his dedication to ethics in marketing, and focus on compliance and fraud in the industry, and has written numerous articles for publications from MediaPost, ClickZ, ADOTAS and his own blogs.

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