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Megaupload: U.S. Government Trying to Rewrite the Rules

The battle between Megaupload and the U.S. Government continues unabated. Megaupload’s legal team has submitted a rebuttal to the Government’s claims that Megaupload can be brought to justice in the U.S. They accuse the Department of Justice of making up its own rules to keep the criminal proceedings alive. The entire case should be dismissed instead, Megaupload’s legal team argues.

kim dotcomEarlier this month Megaupload asked the court to dismiss its case because U.S. law doesn’t permit criminal proceedings against foreign companies.

The issue has become crucial in the ongoing Megaupload proceedings, as it may lead to a premature dismissal of the case.

According to “Rule 4″ of criminal procedure the authorities have to serve a company at an address in the United States. However, since Megaupload is a Hong Kong company, this was and is impossible.

However, the Government disagrees and in a filing last Friday asked the court to deny Megaupload’s motion. The Government claims that the federal rules shouldn’t be interpreted so narrowly. A company should only be served on a U.S. address if they have one, they argued.

The Government further claimed that because Megaupload was doing business in the U.S., there is no requirement to mail the summons to the company. Finally, if the court does decide that Megaupload has to be served, the Government says it could send it to an address of their choosing, such as the office of rapper and former Megaupload employee Swizz Beatz.

Responding to the Government’s claims, Megaupload’s legal team has now filed a rebuttal.

According to Megaupload none of the arguments presented by the Government are supported by case law. Instead of presenting cases that prove a legal precedent, the Government is rewriting Rule 4, Megaupload’s lawyers argue.

“None of the Government’s arguments squares with the plain language of the Rule or with any known precedent construing it. Each should be dismissed, along with the indictment against Megaupload,” they write.

The filing step-by-step refutes the Government’s attempts to amend the rules. Megaupload’s lawyers see no valid argument why the company can be brought to justice in the U.S., and they ask for a dismissal instead.

Only by dismissing the case can the court protect Megaupload’s due process rights, which are clearly at stake here according to the lawyers.

“It seems beyond dispute that (1) Megaupload has been deprived of its property, has had its reputation tarnished, and has had its business destroyed by the Government’s actions in this case; (2) to date, Megaupload has not been afforded a hearing or any other proceeding to contest these deprivations; and (3) absent service of process, this Court altogether lacks jurisdiction over the company.”

Talking to TorrentFreak, Megaupload lawyer Ira Rothken previously noted that the Department of Justice is intentionally trying to keep this “flawed criminal action” alive.

It is now up to the Court to decide who’s right and who’s wrong.

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  • Judge Dredd

    I am the law. Therefor, megaupload is dismissed. Case closed.

    • Anonymous

      * therefore…… Case is adjourned 

      • Guest

         This is international corporate warfare, waged through the US DoJ.

        Mistruth, injustice and the American way.

    • guess

       ”The Government claims that the federal rules shouldn’t be interpreted so narrowly.”
      erm correct me if I’m wrong but don’t lawyers etc do this every day in cases on technicalities? someone please order P**S tests for United States Attorney Neil MacBride and the rest of his team, cause it sounds like their either smoking or injecting something they shouldn’t be.

      • Guest

        Whatever you think they might be smoking or injecting was probably a gift to the DOJ from the Mexican drug cartels in exchange for the guns the DOJ gave them.

      • http://www.facebook.com/profile.php?id=676827475 Luke Solis

        whatever reality they are from. I want a ticket of the opposite.

    • Masterasterix

      simple solution really….just dont do business with USA and problem solved

      • Jorge_C

         Look up Petro dollars. People don’t always have a choice whether or not to do business with the US or some business affiliated with the US. That being said the USA really needs to be put in its place, its overreached far too many times and its own power has been hijacked by interest groups like the MPAA/RIAA who use the US governments absolute power over the world the get what they want. The US has a history of making other countries do what they want, or putting people in power that will do what they want. It will just keep happening until its stopped.

    • dukesofhazard

      simple solution…just dont do any business with the USA

    • Constantin Apopei

      A simple way of Americans from USA to judge and prosecute other origins …equal starting war against other countries and manipulation of Freedom …i ask myself  ”This is call Freedom of living in that World by USA government” …so in that way i can define USA government = New Nazi of the present

  • politux

    But you assume the case will be decided on merit not a bunch hypocritical bullshit….

    • http://twitter.com/Power2All Power2All

      Since when is that ?
      I only see bullshit lately xD

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  • Guest

    I do not believe that the case will be dismissed before the extradition hearing next year due to the fact that if the extradition hearing was successful then there would be no case to be extradited for should the whole megaupload case be dismissed before then. By waiting until the outcome of the extradition hearing then they will still have chance to get a case. It will be the absolute right thing for the Judge in the US to dismiss this case but for him he will probably state that the dismissal will be too premature until the outcome of the extradition hearing just to keep the DOJ happy. Also, there is still plenty of the time for the DOJ to gather more BS and lies and still have the chance to extract evidence seized from the hardrives that was seized by the illegal warrents and cases etc. No way will the DOJ allow this case be dropped when it thinks that evidence on the illegally searched hardrives can be used as evidence against Kim and Megaupload. I do hope that this whole Megaupload case is dismissed but I have this feeling that there is going to be a very long wait.

    • Anon

       The DOJ really can’t afford to let this case drop before the election in November.  When SOPA/PIPA failed, Hollywood became irate with Obama.  That was in January.  Obama had scheduled some big Hollywood fundraising to take place in February, March, and April, so he desperately had to act fact to placate Hollywood before then.  Hence the rushed Megaupload hit job.  Now, looking at White House visitor logs, it appears that the Megaupload hit was planned in 2011 as a personal favor from Biden to Dodd.  Odds are they were waiting for SOPA/PIPA to pass in order to give them absolute authority to disregard any and all rules with no liability.  SOPA/PIPA would have granted a (very thin) veneer of legal legitimacy to the raid.  But it failed, and the raid had to be carried out in haste and without the expected legislative backing. 

      Now the DOJ is stuck with a mess on its hands that grows worse and more publicized by the week.  The US Gov’t went “all in” on this gamble.  If they allow this case to drop now, Hollywood will throw a thermonuclear temper tantrum.  Obama cannot afford that.  So expect to see the DOJ engaged in contortion of the law that would put Cirque du Soleil to shame for the next few months.  Of course, the world is watching with industrial grade floodlights trained on this case.  The next few months are going to be interesting.  

    • http://www.facebook.com/people/Richard-Perham/1543836773 Richard Perham

      Dotcom has volunteered to take himself to the US to face the FBI in court as soon as they free up his money so he can afford to do so.. Funnily enough they don’t seem to be keen on that either..

  • DuckNation

    With every new megaupload update it seems that (my) US Government is getting more ridiculous and at this point it just is sad for them just to keep trying                  

    • The Guy

      I’m with you there, they need to just drop the bullshit and actually do the right thing for the people, not for corporate interests. And I hope the DISCLOSE act mentioned by Demand progress goes through so everyone will know all of the shady dealings going on between said parasitic corporations and our oh so pitiful government.

  • DerkWann

    Thats what the US does best, make it up as they go along lol.
    Now-Anon.tk

  • http://profiles.google.com/zerianis10 Christopher Kidwell

    Yep, they are trying to rewrite the rules here. The law is clear and blunt: unless a company has a branch office in America, they cannot be served under American law.

    They are a non-domestic business which can only be sued in the country where they are based.

    • Guest

      I think that if this fails then the DOJ will serve the 2 residents in the US who were members of the Megaupload company and put them both on trial for all the charges that (they) say Megaupload has committed. As these 2 are not rich like Kim Dotcom then they will not be able to buy good lawyers to put up a defence and therefor the DOJ will win against these 2 people and Megaupload and thus bring an end to Megaupload, They may not be able to get Kim but its Megaupload they want to destroy. If Kim wants to be there for the defence of these 2 people then he will have to travel to the US and once of the plane he too will be charged etc. and brought to trial. I surely hope that the DOJ don’t serve these 2 people and have them on trial for the charges of Megaupload.

      • FrostyC

        Swizz Beatz is pretty rich, but he was basically just a CEO for promotion of their services. I doubt he knew anything, and his only job was to recruit artists for projects.

        The MegaBox venture that offers famous musicians and others a cheap alternative to record companies’ pricey distribution and promotional tools, is why this case is being kept alive.

        • Guest

          I think it will be a good idea for Kim to get someone to run/start MegaBox using their own name as the CEO etc. and then when this whole MegaUpload business has settled then transfer the CEO into his own name. I do agree that this whole Megaupload case, the delays and hellbentness of it all to get Kim Dotcom and to destroy etc. is just a front to stop MegaBox from getting of the ground and running. The sooner MegaBox gets up and running in someone elses name then maybe the sooner that the US will realise that continuing with the case against Meagupload is futile but I guess the US won’t be happy until they completely Kim and Megaupload in its entirety. I would not be surprised that once MegaBox gets up and running that charges will be brought against it and assets seized etc. but I certainly hope not.

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  • Anonymous

    can anyone imagine what the DoJ or US government would say if either/both were to be presented with a call to trial in another country? if the only reason they could get to not attend that trial was ‘over a technicality’, they would be on that like flies on crap! funny how things change when it doesn’t suit, isn’t it? i dont know if Kim/Mega is/could be guilty or not. what i do know is that everyone should have a fair trial and be given every opportunity to defend themselves, regardless of cost. it is clearly not the case here. there was too much going on behind closed doors, involving too many high ranking people both in and out of government but all close to each other. when the truth does actually come out, there is going to be severe consequences for some people. apart from the obvious ‘we want to do something regardless of the legality’ attitude of the US, there are people involved that are crapping themselves in case they are named. they dont want that to happen, so are fighting by all means they can come up with to remain hidden.

    • Guest

      Yeah, you can sure bet that they will be shouting giving reason after reason as to why they should not be extradition etc.

    • Anon

      “there is going to be severe consequences for some people”

      No chance these people are above the law and that’s why they behave the way they do.

      • Guest

        “I did not have sex with Monica Lewinsky” comes to mind.

        • http://ericlortie.com/ Eric Lortie

          That was different. Clinton was removed because the system (IE: the people with money) were opposed to him and not on his side anymore.

          The MPAA and RIAA are the people with money. They’re the people who can get a successful president basically removed on a relatively minor infraction because they don’t want him there.

        • Guest

           @webstravaganza:disqus Richard Murdoc was a person with money and the head of a few national newspapers here in the UK and had great influence with the people in politics and I guess some people would say that he was practically in bed with parliament. If anyone in parliament took a dislike to Richard Murdoc or did not agree to his way of thinking then it would be no surprise that a bad story about the person would end up in the newspaper very soon afterwards. Since it has now emerged that phone hacking by journalists who worked for the news of the world newspaper owned by Richard Murdoc which has been going on for the last 10 years has all come to light these last few months there has been an enquiry about the phone hacking etc. which has been going for weeks now. Richard Murdoc was called in to answer questions as well as other people and now there is a police investigation going too. Richard Murdocs reputation here in the UK has now been tarnished. He may well avoid prosecution for his dealings etc. but his reputation has now suffered and tarnished. I would not be at all surprised that Richard Murdoc is still up to his tricks with now influencing the US government to dealing with the country to his way of thinking that he tried to do with the UK government but in time his tricks in the US will be exposed and he will once again have his reputation tarnished. Some people and the MPAA, RIAA etc. may have the influence to be above the law and avoid prosecution etc. but that does not stop there reputations from becoming tarnished or destroyed when they are exposed and the poopoo hits the fan so to speak. Should the whole Megaupload case goes belly up and dropped etc. someone or some people will have answers to give and whether or not anyone will face prosecutions over the fallout etc. there will sure be some reputations tarnished or destroyed because of it.

      • Constantin Apopei

        “above the law” …the law available in USA and not available in so many countries. Since US government he manipulate freedom in them benefits over world i will call that way of USA equal with NAZI of the today

  • mrskin222

    bit.ly/NB05Ub

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  • No1_2_u

    Basically, the MAFIAA, via the US government & the DoJ had a hard for MU & prematurly ejaculated an arrest & seizure of property, & now they are stuck w/ a limp dick in their hands, beating it as hard as they can in order to get it up again in the hopes they can procede & have their way w/ MU.

    What a of bunch impotant idiots, if & when this does go to trial, there is no way an impartial judge will favour the US, only a corrput judge would be able to; if that happens, who in their right mind would give a shit what the US wants anymore?

    Any country, or entrepreneur, anywhere on earth, regardless of the industry they are in, would always have to look over their shoulder to make sure the US isn’t coming for them w/ trumpt up charges, just so the US could eliminate the competition for their failling industries.

    If this behaviour is not a sign for “the beginning of the end” for pax America, I don’t know what is…

    • Guest

      I would like to know when the US are going to extradite the people in China for producing and sending fake goods etc. to the US.

      • No1_2_u

        Since China is the US’s BIGGEST creditor, has the biggest army in the world, & also has nukes, China is, probably, the only country on earth who is immuned from the tyranny coming out of the US.

        Then again one must always fear an animal w/ its back against the wall, & it appears to me, that the US has its back against the wall & doesn’t know what to do in order to protect its failling economy & industries.

        Have a nice day.

        • Scary_Devil_Monastery

          Well, the US saw it was losing it’s competitiveness in the manufacturing business and decided to try going with intellectual property and service industries as a basis instead.

          Very bad move. When China in the 50′s decided to take the spot as THE manufacturing nation they succeeded. And today their stated goal is to corner the IP market in the same manner, which is why they are purchasing patent portfolios like crazy..

          Mind you, the Chinese don’t believe in IP – thousands of years running a capitalist market means they already know the folly of patenting ideas.

          But if the western barbarians are dumb enough to fall down that hole, China will gladly accept. Ten years from now I predict the US will discover their own regulations are now Chinas primary market weapon and will start stripping anything related to IP from as many trade treaties as possible in a wild panic.

        • No1_2_u

          @ Scary_Devil_Monastery

          Point welll made & I wish “Guest” could have done the research & figured this out by himself instead of us having to explain it to him; but then again, that requires thinking for oneself, an arduous task for some…

          “Mind you, the Chinese don’t believe in IP – thousands of years running a capitalist market means they already know the folly of patenting ideas.”

          “Those who don’t learn from history are doomed to repeat it”, a lesson the US doesn’t seem to get.

          Take care

  • Violated0

    It is correct that Judges should always take a narrow view of the law. After all it is supposed to be Congress who writes the laws and not some Judge making up his/her own rules.

    So the DoJ/FBI saying the Judge should have a wide view of the law is just saying screw what Congress writes when we do what we want. The Judge here should slap them back saying if Congress wanted foreign companies to have US Court trials then they would have wrote in the law to serve companies at their overseas address.

    Well this battle may seem important but it is not when the trial will still go ahead when it is only a case of which rules to follow on the when, where, how and why. One small battle at a time though.

    • Guest

      Now if it were someone in a US company having to face trial in New Zealand you can sure bet they will be using the same argument that the company is not in New Zealand and therefore as it is outside of New Zealand then does not come under New Zealand jurisdiction or laws etc. and will be telling New Zealand exactly where they can shove their extradition. There DOJ’s arguments in trying to get this case to trial and Kim Dotcom extradition clearly shows their desperation and also illegal warrants and searches etc. in trying to get this case and Kim Dotcom to trial.

    • http://profiles.google.com/zerianis10 Christopher Kidwell

      Actually, Congress specifically makes laws vague so that the courts have the ability to ‘read between the lines’ and figure out what Congress actually wanted to do and not just what they have written.

  • http://www.facebook.com/djdutrow Robert Dutrow

    If he gets extradited, he will be found guilty. If NZ doesn’t bend over for the US the guy will be fine. But I see Dotcom sitting in prison, just like Sunde and his comrades. 

  • etaripcisum

    Our U.S. government is so blatantly dishonest, I’m disgusted

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  • http://torrentfreak.com/ Rob8urcakes

    In terms of UK employment law, I’ve represented people (many genuinely wronged) taking cases against naughty Companies as well as our UK government agencies & departments, and I’ve NEVER before seen such a ridiculous proposal from a government agency as this futile and time-wasting attempt to unfairly prolong proceedings against a wrongly accused business.

    These freakin asswipes in the USA are waaaayyyy out of line on this one, and should be disciplined severely – from the top down – whether they work for FBI, the State Department or whomever.

    In terms of CopyWrong policy & enforcement, the USA is quite simply losing ‘the plot’ rapidly.

    Note to Hollywood et al
    You can try wasting the cash we give you for your products, but buying our politicians to pass the laws you desire wont work in the long-term.  The Will of the People shall prevail eventually.  So get a freakin’ grip – you’re just looking like a bunch of crazed dummies, and you can be MUCH BETTER than that by rejoining Humanity.  Try it sometime soon!!

    • Guest

      You can sure bet that if the extradition attempt fails next year that the US will appeal the decision

    • Guest

      I wonder how much pressure/bribe etc. the DOJ are putting on Judge O’grady to get him to bend over and on the receiving end of a poker shoved up the chimney to get him to continue the case and not to dismiss it.

    • Guest

       What “Government departments” have you been involved in representing individuals against?

  • Lololololol002

    That’s how the US always played. Always rewriting the rules to get the upper hand.

    • http://profiles.google.com/zerianis10 Christopher Kidwell

      Unfortunately true. They did it with the Iraq War in Bush’s term, which if we had held to international law was illegitimate and a war crime, since Iraq had not physically attacked us first.

  • Sack US Attorney Neil MacBride

    1) MegaUpload’s attorneys are vigorously kicking US Attorney Neil MacBride’s butt :-)
    2) The long delay in extradition proceedings is in anticipation of the case soon being dismissed in the US District Court for the Eastern District of Virginia
    3) Neil MacBride’s blatant disrespect for the law has damaged the reputation of the United States, and 
    4) President Obama should fire and replace Neil MacBride immediately.

    • Rekrul

       4) President Obama should fire and replace Neil MacBride immediately.

      5) The American people should fire and replace Obama immediately.

      • US voters

         Remember, remember, the 6th of November

        • http://www.facebook.com/people/Richard-Perham/1543836773 Richard Perham

          Bro it was the 5th.. But I fully agree with your sentiment.. Anonymous Rules

        • Scary_Devil_Monastery

          @facebook-1543836773:disqus 

          “Bro it was the 5th.. But I fully agree with your sentiment.. Anonymous Rules”

          6th of november is when the US presidential elections are held.

      • Romney is worse

        Not true, Romney will be even worse.  Fire MacBride but keep Obama.

        • Guest

           I’m not so sure that Romney will be worse.  Sure, he may be sold out to big business, but historically the Democrats have been in Hollywood’s pocket much, much more than the Republicans.

        • Scary_Devil_Monastery

          Well, there really isn’t much left of the original spirit of either the republicans or the democrats.

          So the main issue is whether you want your president to take orders from Hollywood or from right wing christian fundies…

  • Dondilly

     It shouldnt have anything to do with waitingthe outcome of the extradition hearing as that puts undue pressure on the NZ courts who will have to interpret rule 4 themselves.  The indictment of Mega is key as the company would have to be ruled guilty beforethey could then turn on the directors/employees.

    Bottomline is that dotcom and others were working as functionaries of a foreign registered company that does business from that country and so is subject to their laws and regulations not those of the USA.

    They did not trade IN the USA.  If I (in the UK) went to the website of a company registered, hosted and trading in the USA and bought a trangible item say a book or CD, that could not be construed as the company doing business in the UK. The item would be dispatched from the USA and would be considered as a personal import. I could not apply retail law or uk consumer rights on the company and if I were unhappy, I would have to look to american consumer law.  It is no different in the case of Megaupload only the goods are intangible computer services being exported from Hong Kong.

    If the USA had an issue against Mega their legal recourse was either pressure through diplomatic channels to get the HK authorities to prosecute or for the US gov (of the MAFIAA) to seek a private prosecution in HK or make a claim in the HK civil courts.

    Either the USDoJ and the feds are complete morons or my bet is they they tried the HK aurthorities (or wouldnt dare try pushing their main creditor) and was told where to go, leading to their current mess.

    • NZ awaits US

      You have it backwards.  The US court is not waiting on the NZ extradition process – the NZ extradition case delay is in anticipation of the US court tossing out the MU case, which will automatically finish off the NZ extradition process since there is no longer a US case which could sustain an extradition request.

      • Guest

        Well i just hope it don’t end up in stalemate with the US waiting on the result of the extradition before deciding on dropping the case and NZ waiting on the US to dismiss the case and dropping charges etc. before giving the result of the extradition. But I have this feeling that this rapper who was named as CEO for Megaupload will be served with the same charges of Megaupload with racketeering etc. and end up facing trial by himself. If he is indeed serve i can see the DOJ giving him a deal where he will face less charges etc. if he testifies out against Megaupload and Kim Dotcom. The whole Megaupload case should be thrown out but we all know the desperation of the DOJ etc. in getting a conviction etc.

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  • Guest

    “Rule 4? of criminal procedure the authorities have to serve a company at an address in the United States.  ”

    That’s not limited to the US, it seems like one basic principle of international law that all lawyers are taught in their first year of private international law studies.

    The excuse that having american workers or an american CEO makes a company fall under american jurisdiction is bullshit, absolute bullshit.

    A company does not change its nationality magically, it takes a complicated due process to do it. It doesn’t just happen automatically because you hired an american employee or used the colors red white and blue in your logo or any other crazy reason America might come up with.

    Of course ,law students are also taught that rules are relative and  the implementation is always up to the ones with the power to make the rulings and it’s basic history 101 that america, historically, does whatever the fuck it wants.
    Can’t fight the world’s biggest army and media power.

    • http://profiles.google.com/zerianis10 Christopher Kidwell

      Actually, yes, you can fight that. In the real world today, with economic power spread all over the world? The United States isn’t as much the ‘big guy on the block’ as they once were.

      Especially not since every major nation has nuclear weapons.

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  • Anonymous

    The US Government is making a very dangerous argument.  In effect, they are saying Megaupload and the several defendants are subject to US law because *they did business with* a hosting company is the US.

    If the Court rules this is a sufficient nexus to establish jurisdiction, there will be huge damage to our increasingly-technological *services based* economy.  Foreign firms, already wary of our Orwellian system of NSLs, weak data privacy protections under the ECPA, and outright illegal real-time wiretapping, traffic analysis, and data collection by the NSA, will be scared to death of an automatic grant of US jurisdiction, regardless of their country of business.  This would not only weaken our economy in the short term; it will actively disadvantage us for the foreseeable future.

  • Holy Shit Batman!

    This is similar to what Obama said about innocent people being killed from drone strikes.. If they are in close proximity to the target they are automatically considered enemy combatants.

    • http://profiles.google.com/zerianis10 Christopher Kidwell

      Which they shouldn’t be. That is just justifying murder…. for goodness sakes, if you absolutely NEED to assassinate someone (I don’t see any case where that would be necessary in all honesty) just send in a sniper team and use a MF’ing bullet…. not a bomb that can have civilian casualties.

  • Masterasterix

    simple solution …dont do business with the USA

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  • http://profile.yahoo.com/XKKMTSZCAGWAGUKJUPHSYRVBTU Ellen

    Its amazing how america has the capacity of making “friends”  

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  • JD

    If Megaupload loses this case the US government gets a precedence what will allow them to randomly take down any kind of non-US sites and greatly damage international rights and relationships.

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  • qitian

    tinyurl.com/cyk9xz2

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