Posted: 20 Nov 2014 02:32 AM PST

It’s been nearly three years since Megaupload was taken down by the U.S. authorities but it’s still uncertain whether Kim Dotcom and his fellow defendants will be extradited overseas.

Two months ago the U.S. Government launched a separate civil action in which it asked the court to forfeit the bank accounts, cars and other seized possessions of the Megaupload defendants, claiming they were obtained through copyright and money laundering crimes.

Megaupload responded to these allegations at the federal court in Virginia with a motion to dismiss the complaint. According to Megaupload's lawyers the U.S. Department of Justice (DoJ) is making up crimes that don't exist.

In addition, Dotcom and his co-defendants claimed ownership of the assets U.S. authorities are trying to get their hands on. A few days ago the DoJ responded to these claims, arguing that they should be struck from the record as Dotcom and his colleagues are fugitives.

In a motion (pdf) submitted to a Virginia District Court the U.S. asks for the claims of the defendants to be disregarded based on the doctrine of fugitive disentitlement.

“Claimants Bram van der Kolk, Finn Batato, Julius Bencko, Kim Dotcom, Mathias Ortmann, and Sven Echternach, are deliberately avoiding prosecution by declining to enter the United States where the criminal case is pending,” U.S. Attorney Dana Boente writes.

“The key issue in determining whether a person is a fugitive from justice is that person's intent. A defendant who flees with intent to avoid arrest is a fugitive from justice,” he adds.

Since Kim Dotcom and his New Zealand-based Megaupload colleagues are actively fighting their extradition they should be seen as fugitives, the DoJ concludes.

“Those claimants who are fighting extradition on the criminal charges in the related criminal case, claimants van der Kolk, Batato, Kim Dotcom, and Ortmann, are fugitives within the meaning of the statute, regardless of the reason for their opposition.”

Megaupload lawyer Ira Rothken disagrees with this line of reasoning. He told TF that the fugitive disentitlement doctrine shouldn’t apply here.

"The DOJ is trying to win the Megaupload case on procedure rather than the merits. Most people don’t realize that Kim Dotcom has never been to the United States,” Rothken says.

A person who has never been to the United States and is currently going through a lawful procedure in New Zealand shouldn’t be seen as a fugitive, according to Rothken.

The recent DoJ filing also highlights another aspect of the case. According to a declaration by special FBI agent Rodney Hays, the feds have obtained “online conversations” of Julius Bencko and Sven Echternach, the two defendants who currently reside in Europe.

These conversations were obtained by law enforcement officers and show that the authorities were ‘spying’ on some of the defendants months after Megaupload was raided.

“During a conversation that occurred on or about March 28, 2012, Bencko allegedly told a third-party, ‘I can come to Bratislava [Slovakia] if needed .. bu [sic] you know .. rather not travel around much .. ‘ Later in the conversation, Bencko states ‘i’m facing 55 years in usa’,” the declaration reads.

In addition to the two defendants, law enforcement also obtained a conversation of Kim’s wife Mona Dotcom, who is not a party in the case herself.

“During a conversation that occurred on or about February 9, 2012 a third-party told Mona Dotcom, ‘Also Julius [Bencko] wants Kim [Dotcom] to know that he will be supportive in what ever way possible that he needs’,”

According to the U.S. the ‘tapped’ conversations of Bencko and Echternach show that since they are avoiding travel to the United States, they too can be labeled fugitives.

It’s unclear how the online conversations were obtained, but Megaupload lawyer Ira Rothken told TF that he wouldn’t be surprised if civil liberties were violated in the process, as has happened before in the case.

Whether these fugitive arguments will be accepted by the court has yet to be seen. Highlighting the motion Megaupload submitted earlier, Rothken notes that regardless of these arguments the case should be dismissed because the court lacks jurisdiction.

“The United States doesn’t have a stature for criminal copyright infringement,” Rothken tells us. “We believe that the case should be dismissed based on a lack of subject matter jurisdiction.”

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

Court: $30,000 for Sharing a Pirated Movie is Excessive Punishment

Posted: 19 Nov 2014 01:30 PM PST

Over the past several years hundreds of thousands of Internet subscribers have been sued in the United States for allegedly sharing copyrighted material, mostly films, online.

The goal of these lawsuits is to encourage alleged downloader to settle, and in some cases copyright holders continue proceedings against the defendants after being identified by their ISPs.

If the alleged pirates then fail to respond, the rightsholder can ask the court for a default judgment, where they usually get their way.

This also happened in lawsuits brought by the makers of the independent films Elf-Man and The Thompsons. In both cases the copyright holders asked the court for a default judgment of $30,000 for sharing a single film.

With 11 defendants, including one couple who would share the fine, the potential damage award amounted to a massive $300,000. The copyright holders argued that this is justified since they suffered significant losses as a result, but the court disagreed.

In related orders U.S. District Court Judge Thomas Rice notes that a $30,000 punishment per shared film is excessive, considering the evidence that was presented.

“This Court finds the evidence in this case, which merely shows that each Defendant copied and published via BitTorrent Plaintiff's motion picture––the cost of which to rent or purchase was less than $20––rather than distributed for commercial resale, does not support a $30,000 penalty for each Defendant,” Judge Rice writes.

In his order the Judge refers to the Eighth Amendment which prohibits excessive fines as well as cruel and unusual punishments. In this case the requested damages are unconstitutional as they’re seen as excessive in relation to the nature of the offense.

“This Court finds an award of $30,000 for each defendant would be an excessive punishment considering the seriousness of each Defendant's conduct and
the sum of money at issue,” the order reads.

The filmmakers argued that the pirated downloads threaten the financing of future films and that high damages could serve as a deterrent. Judge Rice, however, was not convinced and set these arguments aside.

“… this Court is unpersuaded that the remote damages––’downstream revenue’ and destroyed plans for a sequel due, in part, to piracy––justify an award of $30,000 per defendant, even in light of the statute's goal of deterrence.”

Judge Rice opted to award the minimum in statutory damages instead, which is $750 per film. In addition, he awarded $2,225 in attorney fees per defendant, which brings the total to a little under $3,000.

This is not the first time that the Eighth Amendment has been raised in a file-sharing case. The same argument was used to lower the damages award in RIAA’s case against Jammie Thomas, although this was overturned on appeal.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

Artists and Labels Now Sue Chrysler Over CD-Ripping Cars

Posted: 19 Nov 2014 07:59 AM PST

Toward the end of the last century record labels feared that home taping would kill the music industry.

To counter the threat cassette tape recorders posed at the time, they asked Congress to take action.

This eventually resulted in the Audio Home Recording Act (AHRA) of 1992. Under this law importers and manufacturers must pay royalties on "digital audio recording devices," among other things.

The legislation is still in play today. Instead of targeting cassette recorders, however, the threats are now other copying devices. According to the Alliance of Artists and Recording Companies, this includes media entertainment systems that are built into many cars.

This week the music group, which lists major record labels and 300,000 artists among its members, sued Chrysler and its technology partner Mitsubishi (pdf) for failing to pay royalties.

The dispute revolves around Chrysler’s media entertainment systems including "MyGIG" and "Uconnect Media Center" which allow car owners to rip CDs to a hard drive.

“These devices are covered by the AHRA, but the defendants have refused to pay royalties on them or include the required serial copy protections,” AARC Executive Director Linda Bocchi comments.

The music group reached out to Chrysler and Mitsubishi hoping to settle the issue, but these talks failed. As a result AARC saw no other option than to take the case to court.

“We had hoped Chrysler and the Mitsubishi Electric companies would settle their liability and begin paying what they owe once they had an opportunity to study and assess the issues,” Bocchi says.

“But it has now become painfully clear they have no intention of complying with the law. While litigation is always a last resort, it is clear this lawsuit is the only way to protect our members' rights.”

The current lawsuit follows an earlier case against Ford and General Motors, which is still ongoing.

In both cases artists and record labels are looking for statutory damages, which could amount to hundreds of millions of dollars. In addition, they want to prevent the manufacturers from selling these unauthorized devices in their cars.

Ford has already filed a motion to dismiss arguing that AHRA doesn’t apply to their systems, and the other defendants including Chrysler are likely to do the same. Whose side the court will agree with is expected to become clear in the months to come.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

PirateBay

Torrentfreak: “U.S. Brands Kim Dotcom a Fugitive, ‘Spies’ on Others” plus 2 more

Torrentfreak: “U.S. Brands Kim Dotcom a Fugitive, ‘Spies’ on Others” plus 2 more