The A-list conspiracy: Did Hollywood tell Obama to take down internet entrepreneur Kim Dotcom?

As the infamous file-sharing mogul fights US extradition, Steve Anderson hears his lawyer’s claims of a murky connection between Washington and the movie industry

Steve Anderson
Friday 07 June 2013 10:02 BST

Featuring helicopters and scores of armed police, the dramatic, night-time raid on the remote luxury mansion of a larger-than-life comic book villain in January last year had all the trappings of a Hollywood blockbuster.

This, however, was real-life. Kim Dotcom, the internet entrepreneur and founder of the now-defunct file-sharing website Megaupload was arrested at his home in New Zealand on 20 January 2012, and is fighting extradition to the US, where he – along with six others – is wanted for allegedly making more than $175m (£110m) in illegal profits from online piracy. Indicted for copyright infringement, racketeering and money-laundering, he faces up to 50 years in jail if convicted.

Now holed up in his rented $24m pad in New Zealand after being released on bail, the 39 year-old (born Kim Schmitz in Germany) retains the air of silver-screen bad guy.

But members of his legal team claim the story behind his arrest, and the attempts to extradite him, have a far closer connection with Tinseltown.

Lawyers for the entrepreneur say the charges against him form part of a “political prosecution” waged by the Obama administration in exchange for campaign contributions and political support from film industry lobbyists.

One of Dotcom’s lawyers, Robert Amsterdam, told The Independent that the criminal case against his client, which alleges that Dotcom used Megaupload as a front for a criminal enterprise that willingly shared and profited from millions of dollars’ worth of copyrighted material, is based on erroneous use of civil law and is rooted in the relationship between the upper reaches of the Democratic party and the film-making industry.

In particular, Amsterdam cites the friendship between Vice President Joe Biden and Chris Dodd, CEO of the Motion Picture Association of America (MPAA) and a former Senator.

According to Amsterdam and his co-counsel, the US Department of Justice is going to great lengths to prosecute, and thus appease the Hollywood lobby, using racketeering laws to bolster a weak case built on non-existent civil theories of ‘secondary copyright infringement’.

“Here you have, if you excuse me, computer geeks, and they’re being treated as if they’re the heads of the Gambino crime family,” he says.

Expanding on a white paper recently released via Dotcom’s website, Amsterdam points out that the raid on Dotcom’s mansion came on the same day as the controversial Stop Online Piracy Act (SOPA), a bill designed to tackle online piracy, was shelved in US Congress after outcry from online giants such as Google and Facebook, which claimed it would curb online freedoms.

The day before, Dodd made comments implying that the MPAA would stop supporting President Obama if something was not done to tackle copyright infringement.

Dodd, a man Biden has described as one of his best friends, had told FOX News: “Those who count on quote ‘Hollywood’ for support need to understand that this industry is watching very carefully who’s going to stand up for them when their job is at stake. Don’t ask me to write a cheque for you when you think your job is at risk, and then don’t pay any attention to me when my job is at stake.”

For Hollywood, a considerable amount of money is certainly at stake. The MPAA estimates that online piracy costs the US film industry around $20.5bn per year. Though critics say the true figure is in the hundreds of millions, it is still a significant loss for an industry that is already facing other funding pressures after the 2008 financial crisis.

Amsterdam argues that shutting down Megaupload, and the raid on Dotcom, was a “Plan B” to pushing through SOPA.

“I think, when the President of the Motion Picture Association, on 19 January says that if people basically don’t help him out, he’s not writing any cheques, and then on the 20 January [authorities] attack my client... and throw him in jail, there’s at least an inference there that at least requires an explanation.”

Amsterdam also points to White House logs, which show President Obama hosted Chris Dodd for a two-and-a-half hour private lunch meeting in the Oval Office on 9 December 2011, six weeks before the raid.

Though some would call this conspiratorial, and sceptics will point to the many other issues a former Senator and Hollywood bigwig would discuss at the White House, Amsterdam argues that Megaupload and its founder are likely to have cropped up.

“Starting off from all of the legal grounds that exist and moving to the political nature of the attack [we must ask] ‘was this discussed in the White House?’ and ‘who said what to whom?’,” he says.

Hollywood’s long-standing financial support for the Democrats is no secret. Amsterdam describes the relationship thus: “The MPAA is to the Democrats what the NRA is to the Republicans.”

One glitzy, celebrity-packed dinner organised by George Clooney raised $15m for Obama’s re-election campaign last year.

Dotcom maintains that Megaupload was used by millions of people legitimately, and should be protected under US safe-harbour laws that say internet service providers are not responsible for copyright infringement by their users. His argument is that you can’t sue a corporation for what someone does once they’ve appropriated that corporation’s product or service, and started using it.

“The prosecution seeks to hold Megaupload and its executives criminally responsible for alleged infringement by the company’s third-party cloud-storage users. The problem with the theory, however, is that secondary copyright infringement is not – nor has it ever been – a crime in the United States,” says the white paper, authored partly by Amsterdam.

However, in court filings lodged in Virginia, prosecutors allege that the defendants themselves used the Megaupload website and its subsidiaries to directly infringe copyright and knowingly encourage others to do the same. They also accuse Dotcom’s defense team of using civil concepts to “exaggerate the complexity of the criminal charges”.

The lead prosecutor, Neil MacBride, formerly served as a legal advisor to Joe Biden and was an anti-piracy chief at the Business Software Alliance – the software equivalent of the MPAA. Amsterdam says he has been “hand-picked” and the appointment further backs up his claims of a political prosecution.

The Department of Justice has declined to comment on Macbride’s selection, but Biden has denied claims that he was at all involved in the Megaupload arrests. The Independent’s request for comment from the White House went unanswered.

Amsterdam and his co-counsel Ira P Rothken, just two of Dotcom’s 29-strong legal team, say that if the extradition bid is successful it has massive implications in terms of US overreach and internet freedom across the world.

“You have the United States dealing with a man who has never set foot in the country, dealing with a company where over 90 per cent of the customers involved are non-Americans, and freezing all the information, freezing all this man’s assets,” Amsterdam says. “I just find this so beyond the pale.”

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