Megaupload.com shutdown by the federal government 2

On Thursday, the day after many websites blacked out in protest of SOPA, the government shut down one of the most popular file-sharing websites.  Along with shutting it down, a federal indictment accused the owners of Megaupload.com of facilitating millions of illegal downloads.

Megaupload, a Chinese based company, is accused of costing copyright holders at least $500 million. The United States had jurisdiction because some files were being hosted by leased servers in Ashburn Va.

The shutdown came on the heels of a hacker attack that shutdown the Justice Department’s website and other federal sites.  Officials declared the shutdown of the Justice Department’s site “a malicious attack,” according to the Boston Globe. A hacker group known as “Anonymous” took credit for the attack.

According to the Globe, a Justice Department statement said that Kim Dotcom, 37, and three other employees were arrested in New Zealand on Thursday in relation to Megaupload.  Three more defendants have not yet been apprehended. Dotcom, who had his name legally changed from Kim Schmitz, is the founder, former CEO and current chief innovation officer of the file-sharing website.  The others arrested are Finn Batato, 38; Mathias Ortmann, 40; and Bram van der Kolk, 29.

“This kind of application of international criminal procedures to Internet policy issues sets a terrifying precedent,” said The Electronic Frontier Foundation that defends free speech and digital rights, according to The Globe. “If the United States can seize a Dutch citizen in New Zealand over a copyright claim, what is next?”

Before it was shutdown, Megaupload posted a statement that declared the SOPA bill a huge breach of copyright laws.

“The fact is that the vast majority of Mega’s Internet traffic is legitimate, and we are here to stay. If the content industry would like to take advantage of our popularity, we are happy to enter into a dialogue. We have some good ideas. Please get in touch,” the statement said, The Globe reports.

Megaupload had the support of celebrities such as Kim Kardashian, Alicia Keys and Kanye West.  These endorsements were unusual because the entertainment industry usually condemns the downloading of illegal material, as they lose money from it.

The company cited Swizz Beatz, a musician, as its CEO, but he declined comment to the Boston Globe.

The former website, which was listed at one point to be the 13th most visited website, is charged with copyright infringement, conpiracy to commit money laundering and racketeering.