DOJ Tries To Explain How It Can Get Around Requirement To Serve Megaupload In The US
from the tapdancing dept
Back in April, a US judge pointed out that US criminal law requires serving those accused of criminal activities and Megaupload, as a foreign-based corporation, might not be subject to such service -- potentially killing the lawsuit against the company (though, not against the individuals who run the company). The Justice Department has now hit back with a filing mocking the idea that Megaupload could avoid criminal charges as a company (pdf and embedded below).The filing focuses on how Megaupload had extensive operations in the US, including having many of its servers hosted here -- and even had two separate CEOs at various points who reside in the US (including Swizz Beatz, who the filing notes, has refused to cooperate). It further argues that there is no rush to serve the company, and that it can do so once the execs are extradited to the US -- or it can serve them at the office listed in Hong Kong. Admittedly, part of this fight is really about process technicalities, so I wouldn't make too big a deal of them. However, there are legitimate jurisdictional questions about what the standards are if the US can go after a company anywhere in the globe, just because it's online. That could certainly come back to haunt the US, as US companies are frequently targeted by other countries. Having a case like this could be used as justification to retaliate against US companies.
The filing also highlights something that is somewhat self-contradictory about the US's case. In an effort to argue US jurisdiction, the DOJ argues that Megaupload has been involved in civil lawsuits (on both sides) in the US. That is true... but that seems to weaken another contention in the DOJ's wider case: that it had to take the actions it did because Megaupload was somehow "unreachable" as an offshore "rogue site." The actual evidence, as noted by the DOJ itself in this filing, proves otherwise.
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Filed Under: copyright, jurisdiction, united states
Companies: megaupload
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We are heading quickly down a slippery slope
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Re: We are heading quickly down a slippery slope
Simple - legal tourism is a horrible thing, and has nothing to do with where the supposed libel took place. The IP infringement case is different, as the material is distributed worldwide including back into the US. Since the content generally comes from the US or involves a US company, and the content is made available in the US, there is plenty of standing.
You really cannot draw parallels here.
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Re: Re: We are heading quickly down a slippery slope
Unless of course you reside other than in the USA, then the parallels and the unequitable policies/statutes of the USA in regards to them vs "rest of the world" are striking!
How many US citizens are extradited each year to ANY country? hmmmm?
Defamation is a civil matter as is copyright (oh and yes Copyright can have a criminal component but strangely so can defamation and the bar is extremely high on both of them)
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That's pure hearsay. You have no idea where Megaupload's content generally came from, and you never will, assuming the DOJ gets away with destroying that evidence.
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and the content is made available in the US, there is plenty of standing.
...Wow.
That is exactly the same justification for the libel suits.
http://www.techdirt.com/articles/20120329/03303218286/uk-judge-attracts-libel-tourists-with-775k -award-to-new-zealand-cricket-player-over-defamatory-tweet.shtml
"The original Tweet was received by only a limited number of followers within England and Wales. One expert calculated that they numbered 95, the other 35. The parties have sensibly agreed that I should take the figure of 65."
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Re: Re: We are heading quickly down a slippery slope
If the excuse holds for one, then it holds for the other.
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Not really. If the case falls apart over jurisdictional issues, trust me this will come back to haunt everyone. SOPA will look like a walk in the park compared to what will be piled up as a result of any failure in this case.
Quite simple, the economic interests in the US and the concern of US law makers regarding illegal activities coming from overseas into the US via the internet is already fairly high, and a failure to get Mega and it's founder into a US court would be more than enough to overcome any whining you can do online about SOPA style laws.
Quite simple, you better hope they slaughter Mega, the alternatives are way worse.
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I fail to see how surrender and advocating unfair prosecution of apparently innocent entities can lead to a better situation in anything. First, because I have a hard time being OK with sacrificing other people, but also because the Megaupload case has already opened a lot of people's eyes to what's happening in the big picture. It has damaged the credibility of the US justice system by making the corruption obvious. Getting the case into court would only further harm that.
The "alternatives" you speak of are nothing of the sort. That stuff is going to happen with maximal fury regardless of what happens with Megaupload.
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Yes, you are correct. The US has clearly identified a company that is EXACTLY the sort of thing SOPA was intended to address. People really didn't understand how the internet was being used to undermine local, state, and federal law in the US, and now they have a better idea.
People can understand cockroaches scurrying when the light is turned on. They can understand that Kim was trying really hard to keep his stuff across various jurisdictions to try to avoid the exact situation he finds himself in. He didn't think that anyone would go after a bunch of companies from various countries AND knock his door in NZ as well.
It's much easier to explain to a Senator or House member why new laws are needed to deal with the problem, because the structure and setup of Mega and it's sub companies shows how people can try to hide all their stuff offshore.
If the prosecution of Mega doesn't get at least part of the way there, the laws will likely be changed to deal with the situation.
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Than everything is easy.
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When you acknowledge that that statement should be instead "People really don't understand how the internet might be used to undermine local, state, and federal law in all countries, and now they have a better idea" then we/I might have a meaningful conversationa and debate.
Until then your parochial nature is showing in that you want one law for the USA companies/citizens and another law for the rest of the world.
If the USA keeps going, especially if the mega case is lost (as it should be) then the rest of the planet will get to the point where the USA's economic existence will be in severe (if it isn't already) jeopardy since they will stop trading, supporting, or anything else the 5% that is the USA.
Start thinking holistically not US-centric when talking about international actions and consequences
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The point is only that while SOPA may have failed because of a public outcry, I feel that if the Mega process fails because of something that might have been handled under SOPA, that it will be used as a way to "teach" those in Washington who opposed the bill that they were "wrong" to do so, and that US interests are being harmed.
SOPA failed in part because the bad being addressed wasn't well defined. There was no specific target, no outrage to counter the (hyped up) fear of "censorship" that was pushed by this site and others. The issue was a ghost, not a specific person, site, or situation.
"Start thinking holistically not US-centric when talking about international actions and consequences"
When it comes to the IP world, especially in entertainment, the US is the big stick. Things are very much US centric here. The biggest movies? They aren't coming out of New Zealand, although some Hollywood companies have shot movies there. It would be incredibly hard right now to imagine a world with no US based IP. If it turned off tomorrow, there would be a huge hole that would take a very long time for others to fill, and possibly never to the same levels.
Quite simply, the US is the biggest player, with the most of lose if things are not going their way. It's impossible not to consider things in a US centric way as a result.
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I've got news for you, R. Daneel. Justice is not "that which exists when all the laws are enforced".
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So what you're saying is that since US laws don't apply to the rest of the world, the US government will change its laws to ensure that they do apply world-wide?
If the prosecution of Mega doesn't get at least part of the way there, the laws will likely be changed to deal with the situation.
What situation? That other countries have their own laws which don't always line up with what the US government wants?
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No, not at all.
What I am saying is that US law (and the laws of most contries) are written to deal specifically with people who are physically in their jurisdictions. The internet changes that, making it possible for someone to be physically in another country, but operating a business or offering services directly to American citizens, right in their homes - with nobody responsible for those services actually being in the US.
So, as this example shows, the laws on "serving" business entities are perhaps not clear in regards to companies who exist only outside of the US, but who offer their services and products to Americans. Bringing those laws up to date, and plugging various loopholes that infringing sites use to play whackamole with is a key part of the US legal strategy going forward.
Like it or not, IP protectionism will only grow in the US as America goes further and further towards having an IP dependent economy.
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I suspect this is correct. However, you should be hoping this doesn't happen, because the end result of it will be that the US will be increasingly marginalized and shut out of the world economy.
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This situation isn't new with the internet. The internet just makes it easier.
However, US law should not apply to such companies anyway. US law should only apply to US citizens or those operating in US territory. If the US decides that certain companies should not be allowed to service people in the US, then the only moral way to enforce this is to prosecute the people who are accessing the foreign services, not to try to prosecute the foreign services directly.
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You DO realize that by just putting up a website on the internet, any company is providing its services to ANYONE ON THE PLANET, without regard for jurisdiction. The way you and the Corporate Government word this stuff, you are trying to change the perception of how the internet works from a "anyone can find/visit your site" to "promoting your stuff to a particular country/region." I'm sure all sites want to be accessible to the US and are interested in "offering their services" to US citizens, or the UK or whoever, but simply creating a site isn't the same as some kind of targeted business. To then use this as an argument to justify international jurisdiction of one country's laws into another is to fundamentally misrepresent how the internet works.
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"To then use this as an argument to justify international jurisdiction of one country's laws into another is to fundamentally misrepresent how the internet works."
The issue is that when a US citizen interacts with these websites, it does in some way become a jurisdictional issue.
Look at it this way: if Mega's service would be specifically illegal if operated in the US (and that appears to be the case), why should US law be usurped by them moving offshore and continuing to offer that same service in the US?
The laws of almost every country on the planet were not written with this sort of consideration.
The fact is that when you put a website on the internet, it is available to everyone - unless you specifically take action to limit it's availability. Mega could have chosen to exclude the US from it's business, in the same manner that most poker sites now do. They did not.
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And for good reason which is what you seem to be unable to grasp. There is no logic in applying one country's laws beyond its borders. If the US could do this, so could Iran or Jemen. If you don't see the danger in this, you can't be helped.
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That sounds like a road to economic ruin, for two obvious reasons. The backlash against IP protectionism has already started and it too will continue to grow in direct response. And any economy that depends on 'imaginary property' in a world where digital data or already infinitely reproducible and physical goods are continually getting easier to copy (e.g. 3D printing) is setting itself up for failure.
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It coudn't be any simpler. This is possibly because they did not want the USA to become the next Cuba. No one will want do business with US businesses if it exposes them criminalization under US laws. Possibly there was a time your legislators thought the economy mattered.
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So, as this example shows, the laws on "serving" business entities are perhaps not clear in regards to companies who exist only outside of the US, but who offer their services and products to Americans. Bringing those laws up to date, and plugging various loopholes that infringing sites use to play whackamole with is a key part of the US legal strategy going forward.
Nude photos of women are illegal in most middle east countries. Companies like Playboy put such photos up on the net where they can accessed by anyone in the middle east. Therefore, by your logic the governments of any/all middle east countries should be able to criminally charge Playboy and its executives for violating their laws.
Or is the US somehow special? Do we get to enforce our laws against foreign companies while US based companies can violate the laws of other countries with impunity?
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Even if you accept that Kim was doing something illegal (I don't), this is nothing new. Multinational corporations do this every day to limit their taxes burdens and legal liabilities.
Megaupload was siezed, and Kim was arrested for at worst civil copyright infringement. Yet HSBC was quite openly helping drug kingpins, terrorists, and rogue nations launder money, and the worst that has happened is that some of their executives resign from their positions with their fat golden parachutes intact.
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Which thankfully does not (yet) apply elsewhere. The fact that you seem to think other countries will not retaliate with applying their laws to US citizens using the same justifications is staggering.
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Could you see the shitstorm that would ensue as a official spokesperson from the Russian Federation goes live on CNN as the raid is being carried out at the company HQ and the board, Chairman, CEO and his executive staff are being shown being arrested by the Russians and having the Russians stating that they are using the same precedents as created by the DOJ in their prosecution of Megaupload.
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Even copycrap has limits, the public patience for it has run its course.
SOPA was just a taste to what it is to come, if idiots insist on this course of action, it will get uggly eventually and you don't want to be on the side of the MAFIAA that is not the side that is going to win this in the end, they don't have the man power to make it happen, they don't have the money and they don't have the influence and by that I don't mean political influence.
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The US is now a such a rogue state with such a lawless government that we should just hope someone is arbitarily persecuted for at the whim of their pay-master over lords because otherwise the government will terrorize the people, destroy innovation, and act corruptly on a heretofore unseen level to give their cartel cronies what they demand?
And that's all cool with you?
Classy.
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I don't think there's really much question about whether the court has personal jurisdiction over Megaupload Ltd. (and over the individual defendants as well). The issue here is only over service of process on Megaupload Ltd. (and not the individual defendants).
The purpose of service of process is provide notice to the defendant. Megaupload Ltd. obviously has notice--they're in federal court arguing this very motion. So it's not like Megaupload Ltd. isn't getting their constitutionally-guaranteed notice of the suit. Due process doesn't demand that actual service be made. It is only required that reasonable efforts are made--and the government spells out lots of ways it can reasonably attempt notice. But considering the fact that Megaupload Ltd. has ACTUAL notice here, the whole argument about notice is silly.
Nonetheless, Megaupload Ltd.'s very expensive lawyers are making the argument...
Federal Rule of Criminal Procedure 4(c)(3)(C) provides: "A summons is served on an organization by delivering a copy to an officer, to a managing or general agent, or to another agent appointed or legally authorized to receive service of process. A copy must also be mailed to the organization's last known address within the district or to its principal place of business elsewhere in the United States."
Megaupload Ltd. is basically arguing that since they have no mailing address in the U.S. that can be used to mail a copy of the summons, they get to break whatever laws they want in the U.S. and the U.S. can't do a thing. Good luck with that. The government's brief makes a lot of great counterarguments, but on its face, the argument is laughable. Rule 4 doesn't create a loophole for criminals to violate whatever U.S. law they want with impunity by simply not establishing a mailing address.
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... and how much longer does this sort of motion draw out the case, leading to Kim bitching about how long it takes?
More and more, he looks like a self serving twit.
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More and more, he looks like an innocent man being unduly persecuted...I mean prosecuted.
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I have no offices in Saudi Arabia and thus, I feel completely free to break whatever Saudi laws I want. MOHAMMED WAS A CHILD MOLESTER AND NOT THE PROPHET OF GOD.
Should I still be convicted under Saudi laws?
Megaupload never had offices or any physical presence in the US. Therefore, they are beyond US laws. That law that Kim's lawyers is quoting is important for a reason: its supposed to limit the US's authority to its own soil, not to the rest of the world.
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They rented servers in the US yes but let us consider for a moment you are using a rented server in Saudi Arabia and you host Mohammed caricatures like the Danish thing (with a bomb in his head). Technically you are violating Saudi Arabia laws but should you be extradited there? I don't think so. And given that the content MU had on US servers was most likely used and uploaded by US citizens then it's those people that are responsible for whatever infringements that happened. Considering MU complied DMCA takedown notices even though it wasn't obliged to under NZ laws or wherever their headquarters are.
Having economic ties to a country doesn't automatically subject you to the laws of that country. Before asking for extradition the US has to PROVE there were any crimes committed.
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Where is the evidence?
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And the rest is in the hands of the DOJ. Where else would it be? Not sure you understand how this works...
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None of the Evidence and documentation given and stated in the Indictment or gathered by the FBI etc has been proven as actual fact or proved as true in a court of law. It is so easy to trawl through documentation and take out all the shit and dirt from it to show that the person is guilty etc when in actual fact the person is innocent. The FBI can trawl through Little Red Hiding Hood and make her come across to be a psychotic schizophrenic murdering psycopath but on seeing all the film she is just a sweet innocent girl.
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So you've just pronounced them guilty without a trial or evidence? Haven't you been following the MU story at all, of how much fail there has been on the part of the prosecution? I sincerely hope you're not a lawyer or judge.
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So tell me, is the case in shambles? Here's a few things that should destroy the case
1) Warrants were illegal
2) Feds copied data from Kim's hard drives without letting NZ authorities know, AND most importantly, refuse to let Kim see that data as part of his defense
3) Feds Have said that Kim can't choose his own defense team.
4) Feds are making up laws to suit the charges
http://www.techdirt.com/articles/20120530/16055119130/megaupload-filings-show-massive-flaws -us-case-ask-court-to-dismiss.shtml
4)
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Yeah, we rather believe shills that defame others as pirate-apologist sources who just happen to believe any bullshit their being fed. You would draw better conclusions if you wouldn't take anything the US prosecution (of all people) spins as fact.
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Otherwise, they have few ties to the VA district. Most of the other business relationships are shallow or in other districts.
The available in the US argument is full of issues and can really bite the US in the butt later. Basically anything on the internet can be viewed in any country, so if that was all that was required for jurisdiction US companies would be subject to potential legal issues in any country in the world. Same with money via a service like paypal. Paypal doesn't care where you are, only that you have a legitimate way to pay.
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You are correct to point out that they haven't yet been convicted. That much is obvious. And of course they are presumed to be innocent. But the fact is that there is enough evidence that they're not innocent that an indictment was handed down. An arrest warrant was issued, and extradition is in the works. While they haven't been convicted, there is certainly evidence one may draw conclusions from.
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Because without the money laundering charge, everything falls apart. It hinges entirely on the idea that paying Carpathia for the servers is money laundering, which makes this a criminal act. No money laundering, no criminal act. No criminal act, no extradition. No extradition, game over.
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Can you please point out the federal statute that gives the US government the jurisdiction to file criminal charges against a foreign company operating in a foreign country?
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I'm saying that if an entity in country A is doing something legal there, but illegal in country B, then the wrong way to deal with this is to try and attack that entity directly. If something really must be done, then that something must be limited to things in country B. Defensible actions would be to make it illegal for entities in B to do any business with the entities in A.
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The federal law that gives the U.S. government jurisdiction to prosecute violations of U.S. law is the very law that Megaupload Ltd. is being prosecuted under. They are listed on the face of the indictment. (You can Google it.) Those laws, in turn, are created pursuant to powers granted to Congress under the U.S. Constitution itself. See U.S. Const. art. III.
The extent of a court's jurisdiction is limited by the Due Process Clause. U.S. Const. amend. V. And that analysis begins by reading International Shoe (which is still good law, but it's not the only good law on the subject).
Answer your question?
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Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 413-14 (1984) (emphasis added).
Seems like exercising jurisdiction over foreign corporate defendants is settled law. I'm curious how you reconcile that with what you're saying.
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Doing Business in US makes you subject to US Law
This IS NOT a foreign company, it is a Global Company.
If you do business in ANY country, you are subject to that Country's laws period.
"The filing focuses on how Megaupload had extensive operations in the US, including having many of its servers hosted here"
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What the hell is the definition of a global company? A company with offices and staff in every nation, including Antarctica?
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the US refuses to acknowledge any such claims, except it's own (which is 'everything... if we ever decide we actually want it.') and i Think Russia (or the USSR at least) refused to acknowledge the idea that Anyone could have a claim. (i may be misremembering, look that one up.)
there's currently a treaty in force that renders the Consequences of such claims to be absolutely zero (beyond who's courts you end up in if you murder someone down there or something... and that depends mostly on who owns the base and where you're from, not the territory, anyway... with good odds of ending up in an NZ court no matter which way you slice it.)
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This is certainly untrue as a blanket statement. If it were true, then if I sell my porn collection on eBay to someone in Guyana, the US should ship me there so I can serve my time in prison.
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One word, tax.
How many companies that trade or even are otherwise based in the US technically exist in a mailbox in a building with a bunch of other mailboxes on some island somewhere so they can avoid US tax rates?
If what you are saying it true then they should all be arrested and put in jail.
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Nuff said.
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I'm willing to go with Hanlon's razor on the DOJ wanting to destroy evidence that may or may not have looked bad for them, but I'm not sure how they intend to sue without evidence. Probably just scream "they were totally infringing!" and hope the judge buys it, then appeal a bunch of times if he doesn't.
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Then they ramped up the accusations and introduced racketeering, money laundering and other accusations that are based precisely on the first mass infringement accusations. It is because of those criminal charges that the US Govt claims Kim Dotcom and his crew must be extradited to the US for a trial. Except that they can't PROVE the damned CIVIL charges to begin with. If you read the last few stuff related to the MU case you'll see that rulings in NZ address this issue. And I'm not even mentioning jurisdiction issues.
In the end the US Govt is already succeeding in killing the company which for me was the goal since the beginning. Putting Dotcom out of business (and behind bars just because they can) sends a serious chilling message all over the cyberlocker environment as we've seen. When this idiocy is over a few years from now and Dotcom is completely smashed to the ground under the burden of all the legal costs it won't matter if he won or lost. Courtesy of American taxpayers money.
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I think, at this point, the MAFIAA and their puppets in the DOJ don't CARE whether Kim Dotcom wins, loses, comes to America or heads off to Antarctica. They DO want to scare him, to burn thru his resources (or lock 'em up where he can't get them.) His value to them is as scarecrow.
And on that issue; the battle is over and the bad guys won.
The only way the bad guys lose is if Megaupload rises from the dead. If he manages to get back online AND gets a judgement against his persecutors then he becomes a hero to the other lockers and a trailblazer in 'how to profit from getting arrested'. If he just gets out clean, then the chilling effect on other business will still exist.
I expect this won't stop cyberlockers from starting up. It will just stop 'em from offering their services to the US.
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Piracy has stopped. Mission accomplished.
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Just what they are paid to do..
I used to think government agencies like DOJ (and FBI/NSA/CIA) were not open to bribes, but I guess those days are long gone. Still wonder what size of bribes are needed?
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Re: Just what they are paid to do..
That way there's no paper trail that might lead back to anyone, just a verbal or implied contract, which would be all but impossible to prove or prosecute in court unless an investigator managed to get a recorded conversation or something flat out admitting it.
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Hmm
Allegedly facilitate copyright infringement that numbers at most hundreds of millions? Extradited, tarred, feathered, imprisoned.
Thank you, Federal Government, for demonstrating your priorities.
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