MegaUpload Dares RIAA To Sue Them

Dangerous_Minds writes "Yesterday, there were reports that the RIAA and MPAA were working with Mastercard to cut off payments to so-called 'rogue-websites' like MegaUpload. Today, a spokesperson from MegaUpload issued a response to the RIAA on ZeroPaid. Bonnie Lam of MegaUpload said, 'the vast majority of our revenue is coming from advertising.' She also said, 'Megaupload is a legitimate business operating within the boundaries of the law. In five years of operation we have not been sued by a single content owner. If the RIAA or MPAA would have legal grounds they would have taken us to court by now. We suggest that they attack us within the legal system and stop labeling us until they have something to show.'"

Comments

Interesting story behind MegaUpload

[devxo]

For those that don't know the story behind the guy of MegaUpload, MegaUpload and other sites in the same family, it's definitely an interesting one.. In summer TorrentFreak made an article called The Mega-Money World Of MegaUpload.

The whole article is interesting read, but here are some interesting bits:

Kim ‘Kimble’ Schmitz is a quite unbelievable character. Born in 1974 in Germany, he grew to become a computer hacker, successful businessman and convicted criminal. In 1998 Schmitz received two years’ probation for hacking into corporate networks and abusing telephone services but the draw of big money was just around the corner.

In 2001 Schmitz pulled off a huge stock market bluff which netted him a small fortune. After buying shares worth hundreds of thousands of dollars in the almost bankrupt LetsBuyIt.com, he announced that he would invest 50 million euros in the company, but in reality he didn’t have the money. His declaration led to the biggest single-day rise on the German stock market which allowed Schmitz to sell his shares and pocket $1.5 million profit. He was arrested for insider-trading in 2002, sentenced to a term of 20 months and given a 100,000 euro fine.

Also in 2001, one of Schmitz’s companies loaned another one 280,000 euros and conveniently both went bust shortly after. Schmitz later pleaded guilty to embezzlement and received another two years probation.

According to a recent report from New Zealand, Schmitz is currently under investigation for using multiple names to register three luxury cars including a Rolls-Royce Phantom convertible. The cars are adorned with personal plates – GOD, WANTED and GUILTY.

The vehicles are registered to an address in Coatesville, New Zealand, which turns out to be a very special venue indeed – Schmitz’s newly-acquired mansion and the country’s most expensive house, a snip at just over $20 million USD.

An investigative piece found Schmitz in Hong Kong business records with the new name "Kim Tim Jim Vestor", allegedly having a Finnish passport, acting as director of several "Mega-" companies, among them Megaupload Ltd. and Megarotic Ltd.

As of 2008, Kim currently lives on the top floor of the Grand Hyatt in Hong Kong with his wife and child. He goes by an alias of “Kim Vestor.” http://www.gfy.com/showthread.php?p=15096149

Re:Interesting story behind MegaUpload

[tomhudson]

$1.5 million profit. $100,000 Euro fine and 20 months free room and board.

There are millions of people who would sign up for that sort of deal.

Re:Interesting story behind MegaUpload

[Anonymous Coward]

Have you seen most European jails? They aren't bad at all. Usually after a while you get a TV and maybe a game console in your room (and lots of other things if you want to order them), theres lots of activity every day, you can go on weekend holidays and the food is even better than what is offered to school kids. Lots of people don't like their tax money is used like that, but that's the way it is - being in jail in most of Europe is like taking a relaxing holiday.

Re:Interesting story behind MegaUpload

[Anonymous Coward]

...and most Americans seem proud of the violent, racist prison system they have.

That's better?

Re:Interesting story behind MegaUpload

[Gerzel]

No our prison system is indeed violent and racist to what can be categorized as an astonishing degree.

Our prisons are violent relative to others in first world nations with more reported incidents per capita.

Our prisons do indeed have gangs split on racial lines and are havens to a certain extent for racism.

Re:Interesting story behind MegaUpload

[Local ID10T]

Maybe we should put fewer criminals in prison and more law-abiding citizens. I'm sure they'd be much nicer places.

Just a thought.

That's how we manufacture the criminals needed to keep our prison system going.

Re:Interesting story behind MegaUpload

[Stiletto]

And no matter how hard it is, these same idiots will keep claiming the prison system isn't hard enough. Isn't it time we start ignoring people who don't make any sense.

Re:Interesting story behind MegaUpload

[GooberToo]

The US prison system makes very little effort to rehabilitate; contrary to popular myth. Its well known for making prisoners more violent and more proficient criminals. Furthermore, it creates a clearing house of criminal contacts for criminal activity on the outside.

And it gets even worse. The US system is set up to punish criminals for the rest of their life helping to ensure that once you enter the criminal system you have very little chance of ever making it out. Worse, they illegally strip their Constitutional rights so as to ensure they have no say in changing the system for the better; even after they've paid their price.

As first world industrialized countries go, the US prison system is one of the absolutely worst on the planet. And the US prison systems is the largest growing US government service to date. The US prison system houses more people than some countries have in total population - and growing. The US prison system has a huge chunk of those are there for minor drug charges where they are trained to be become better, more violent criminals on the inside and continuously punished on the outside so as to ensure they are forced to re-enter the prison system at a later date. The US prison system has one of the highest reviticism rates of any first world, industrialized countries. Many argue the high reviticism rate is by design.

Notice the steep rise in incarcerations after declaring the war on drugs. Anyone in support of the war on drugs is willfully supporting murder, sex trades, slavery, and yes, even terrorism (much comes from the middle east - like Afghanistan), and turning some of the most worthless humans ever born into some of the most powerful humans on the planet - while taking it out on the US' (and other countries') civilian populations. By every measure and every statistic, the war on drugs has been lost almost as soon as it started. And every year, the US tax payer pays billions to fuel paramilitary training and growth of our police forces while create a professional, criminal, industry on the other side, while paying billions more to imprison the very "criminals" which the first billions created.

Re:Interesting story behind MegaUpload

[Xest]

"Lots of people don't like their tax money is used like that, but that's the way it is - being in jail in most of Europe is like taking a relaxing holiday."

You're overstating this ability particular with regards to your earlier comments about TVs and game consoles- tax payers do NOT pay for these, the criminals are made to pay for these themselves if they choose to.

Re:Interesting story behind MegaUpload

[Runaway1956]

Another idea - maybe we shouldn't criminalize such a high percentage of our population? Look at the prison statistics. A majority of our prisoners are convicted of minor drug related offenses. Almost all of them were originally convicted of such crimes, then sent to prison where they LEARNED to be "institutinalized" low-lifes. Prison is nothing but a training ground for criminals. Decriminalize drugs, and most of those criminals will never make it to prison. Decriminalize other "victimless crimes" such as prostitution, and that will remove another large segment of our prison population. Our laws are just FUBAR'd, that's all there is to it.

Re:Interesting story behind MegaUpload

[SuricouRaven]

Sarcasm aside, that's what happens. Send a minor offender to jail - someone convicted of one of the lesser drugs offences, or petty theft. During his few months he'll make criminal friends, learn new skills, and be exposed to a culture of criminality and violence. When they do get out, non-criminal society is largely closed to them - it's extremally hard to find work, because most workplaces arn't going to hire a convict unless they are very desperate. So the only way they have to make a living is to put their new skills to use. Prison just makes more criminals. Rehabilitation programs do exist, but they are extremally expensive per-prisoner, and taxpayers are loathe to see any money spent on helping the 'criminal scum.'

Actually

[superpaladin]

I always wondered why they(and Rapidshare and other clones) haven't been sued into oblivion yet. Not that I am rooting against them, but if Napster was found guilty all those years ago...

Not a safe move.

[EWAdams]

People don't sue because they have legal grounds. They sue because they think they can force the other side to spend so much money that they'll cave. Most lawsuits are settled in favor of whoever has deeper pockets. Being in the right isn't enough; you have to be in the right and rich. Otherwise it's better to keep your head down... sadly. If the US ever gets around to tort reform (yeah, right), this situation may change.

Wikileaks

[mr100percent]

I feel like once they did this for WikiLeaks, the floodgates opened and now Mastercard is going to be under pressure to cancel accounts left and right. Heck, why isn't Mastercard closing the accounts for the Ku Klux Klan? How come you can still donate using Mastercard?

Re:Wikileaks

[FudRucker]

all the constitution & bill of rights dont mean shit in the real world, all those two documents are used for is to brainwash grammar school children in to thinking the government institutions are actually benevolent, so they wont realize what a bunch of corrupted tyrannical criminals the government is until they are over 40 years old...

Re:Wikileaks

[icebraining]

But that's the point, they have set the precedent with Wikileaks. If they close some accounts despite their legality, we must assume they actively support those they don't shut down.

Re:Wikileaks

[RyuuzakiTetsuya]

When I was a kid, I was taught that the Government existed, in America, as a reflection of the people, and the Constitution and Bill of Rights were a reflection of those goals.

If the Government is malevolent, cruel, vile, and evil, maybe that's not the Government's fault.

Re:Wikileaks

[Jeeeb]

You're assuming that they're being pressured by some political agency.

Don't. They are the, single biggest financial organization in the world next to the Federal Reserve. Not even the World Bank is as big as MC.

MC can look every single world leader directly in the eye, whip out their privates right in front of the cameras, and urinate directly into those eyes, one at a time, and nobody would DARE do or say anything. More than a few would swallow.

They're doing this because they found a way to make it profitable.

Mastercard: - Net assets: 7.47 Billion
- Net income: 1.46 Billion
- Criticism by world leaders:
Sued for anti-trust by the EU in 2009 and forced to reduce its fees to 0.2% of purchase
Criticised this year by members of the European Parliament for cutting of payments to Wikileaks.

Federal Reserve:
Total Assets: 2.34 Trillion
Total Liabilities: 1.348 Trillion
Net Equity: 56.78 Billion
Also holds about 6.4 Trillion dollars worth off securities of the balance sheet.

Mastercard is a piddly little company. I'd be surprised if it was even in the biggest 100 financial institutions in the world. Infact it's not even a money lender. It's just one of the large world-wide transaction processing networks. Although by no-means the largest or globally accepted.

Needs A New Tag

[IonOtter]

Slashdot needs a new tag for stories like this?

I nominate "bitchslap".

Re:Why should the RIAA even bother with a response

[BLKMGK]

Umm, MC isn't halting payments - at least not yet according to the umm articles linked. Mega was mentioned as one of the services in particular that the *IAA would want this halted with - supposedly since I haven't found them mentioned in my searches. Mega is simply stating that IF this were done it a) wouldn't impact them overly much and b) if they are doing something illegal why not come after them directly?

Frankly it's a disturbing prospect that someone could knock down a company by simply trying to strangle funding in this manner - we shoudl all be concerned. I also wonder if Mega has considered that they might also go after the advertisers payments in some way also.

I don't see good coming of this at all IF indeed the *IAAs have found a way to twist the arms of funding supplies like this.

riaa/mpaa have no balls

[arbiter1]

When it comes to other big companies like megaupload that have money to fight. They turn to dirty crap like this. they go after torrent indexer's, why haven't they hit Google? You can search out torrents on Google just like any other torrent search site.

Re:Why should the RIAA even bother with a response

[cheekyjohnson]

Megauploads is for one thing: piracy.

Odd. I thought it was for uploading files. I guess the only purpose of a knife is too kill people, then.

I thought everyone wanted these big corporations to start acting ethically.

You act like everyone believes that copyright infringement is 'wrong'. This is not so.

Not about copyright infringement

[Anonymous Coward]

This is not about copyright infringement this is about media company's attacking the internet. They want you to be watching TV, going to the movies and renting DVD they don't want you entertaining yourself on the internet.

Re:Why should the RIAA even bother with a response

[Anonymous Coward]

I've been an online merchant for about a decade. Historically, MC cards have been about 30% of sales. The lion's share is on Visa cards. MC has always been a self-righteous pack of assholes, cutting off merchants right and left over "content damaging to the MC brand" and other such bullshit. Their company policy is to piss in the face of consumer choice every chance they get. I've had 5-figure fines over content issues in the past and if it ever happens again, I'll dump their worthless asses purely out of spite. I would absolutely love to tell customers "we don't accept that piece-of-shit card, and you shouldn't either". It would be a mild inconvenience, but nothing close to "chaos". Keep in mind that the demographic merchants care about (i.e., disposable income, not living paycheck to paycheck) normally have 2 or more cards in their wallet. Nobody ever went bankrupt just by telling MC to go fuck themselves.