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New Zealand Supreme Court denies MegaUpload bosses one more appeal

By | Published on Wednesday 22 December 2021


Kim Dotcom and two of his former MegaUpload colleagues have suffered another setback in the New Zealand courts as the tenth anniversary approaches of the day in 2012 when their former file-sharing business was dramatically shutdown by the US authorities.

American prosecutors have been trying to extradite Dotcom et al to face criminal copyright charges ever since. And in the main, those prosecutors have prevailed in court. However, there have been plenty of legal technicalities for the former MegaUpload team to exploit along the way, and it was on one of those technicalities that the New Zealand Supreme Court ruled yesterday.

If the criminal case against the MegaUpload team ever gets to an American courtroom, a key part of the debate will be the extent to which the former file-transfer site was protected by the good old copyright safe harbour.

During court proceedings in New Zealand, lawyers working for Dotcom et al have argued that the main MegaUpload service was basically like Dropbox, while an accompanying video-sharing platform was just like YouTube. Therefore, they argue, the directors of MegaUpload are no more liable for any copyright infringement that may have occurred on their networks than the directors of those two other digital companies.

Of course, US prosecutors will argue that while there are parallels between the MegaUpload service and Dropbox and YouTube, the team running the former more proactively encouraged and knowingly tolerated copyright infringement among their userbase, and therefore do not qualify for safe harbour protection from liability.

All that said, in the New Zealand courts the actual debate is whether the crimes Dotcom and co are accused of are covered by the country’s extradition treaty with the US.

Basic copyright infringement – even criminal copyright infringement – is not. But if – by encouraging and allowing copyright infringement – Dotcom and his colleagues could be legitimately accused of conspiracy to defraud, then that is most likely grounds for extraditing the old MegaUpload chiefs.

Having agreed to hear an appeal from the MegaUpload defendants in 2018, the NZ Supreme Court ruled late last year that the allegations made by American prosecutors were sufficient to allow extradition. However, there was also a technicality in that ruling.

Earlier in the appeals process, the Dotcom side sought a judicial review of the original district court ruling – all the way back in 2015 – which first approved extradition, based on the argument that procedural and substantive errors were made during that initial hearing.

Lower courts declined to allow that judicial review to take place on the basis such a thing would be an “abuse of process”. However, the Supreme Court said in November last year that the lower courts were wrong to deny the judicial review. And therefore that particular element of the case was sent back to the country’s Court Of Appeal for new consideration.

However, the Court Of Appeal then dismissed the judicial review proceedings. Which prompted the MegaUpload team to return to the Supreme Court arguing that the lower court had not done what it was told to do by the higher court.

They argued the Court Of Appeal had made various errors in reaching its most recent decision that “gave rise to questions of general or public importance”, and which required another Supreme Court intervention “to prevent a miscarriage of justice”.

However, the Supreme Court announced yesterday that it did not concur. In a statement accompanying its judgement, the Supreme Court said that it “did not see the case as giving rise to questions of general or public importance about the Court Of Appeal’s approach”. And it “was satisfied there was no appearance of a miscarriage of justice in the Court Of Appeal’s factual assessment that the issues were not outstanding”.

The court then added that the key issues “had in fact been dealt with in an expansive and detailed way”, and that “the arguments the applicants wished to raise about various other aspects of the Court Of Appeal’s decision had insufficient prospects of success to justify an appeal to this court. For these reasons, the applications for leave to appeal were dismissed”.

So there you go. There are still some extra steps that Dotcom et al will take in a final bid to fight their extradition. Following yesterday’s judgement, on Twitter, Dotcom himself simply said “unfazed”, and then plugged some livestreams he’s got planned for next month. “2022 will be fun”, he added.

Of course, with the tenth anniversary approaching of the day the American government – encouraged and backed by the American music industry – took MegaUpload offline, that means the tenth anniversary has just passed of the day some of the biggest stars of the American music industry joined a sing song about how great MegaUpload was. The platform may be long gone, but the sing song lives on. You know, despite Universal Music’s best efforts.