×

Appeals Court Sides With Federal Government in Seizure of Megaupload Assets

Tens of millions of dollars in funds held in foreign banks by Kim Dotcom and others responsible for Megaupload will remain frozen after a federal appellate court rejected claims that U.S. courts lacked jurisdiction over the property.

The 4th Circuit Court of Appeals, in a 2-1 ruling, upheld a district court’s default judgment against Dotcom and Megaupload, which led to forfeiture orders for assets in New Zealand and Hong Kong.

Dotcom is fighting extradition from New Zealand after Megaupload was shut down and his Auckland home was raided in 2012, in what authorities characterized as massive copyright infringement of movies, TV shows, and music. A grand jury returned an indictment for criminal copyright infringement and money laundering “with estimated harm to copyright holders well in excess” of $500 million, and income in excess of $175 million.

Courts in Hong Kong and New Zealand issued restraining orders on about $75 million in Megaupload assets, although New Zealand courts have released millions in legal fees for Dotcom and $170,000 per month in living expenses. As extradition hearings have dragged on, U.S. authorities sought to restrict the money flow, and a federal district court granted a default judgment and issued forfeiture orders for the assets in March of 2015.

The appellate judges rejected claims that federal courts lack jurisdiction, noting that the alleged “Mega Conspiracy was a file-sharing scheme in which copyrighted files were illegally transferred to users around the world through the servers located in Ashburn, Virginia.” The opinion was written by Judge Roger Gregory.

In a dissent, Judge Henry Franklin Floyd wrote that because the frozen assets were in the control of foreign governments, the district court could not issue an order that would be “binding against the world.”

Popular on Variety

More Digital

  • Bristol, CT - March 13, 2017

    Mina Kimes Helps ESPN Kick Off 'Daily' Podcast

    Mina Kimes is preparing to take ESPN into a new frontier. The sports-media giant has launched a “SportsCenter” for Snapchat and tested baseball telecasts for kids. Now it’s hoping to set up shop in another media venue. Starting tomorrow, the Disney-backed company launches “ESPN Daily,” a weekday morning podcast that aims to tap its vast [...]

  • Neilsons Measurment Problems TV Digital

    AT&T's Ad-Tech Unit Xandr Buys Clypd To Help Place TV Commercials More Precisely

    Xandr, the AT&T ad-technology unit, has purchased a new company that helps advertisers use data to place commercials in front of the audiences most likely to want to watch them The AT&T division said Friday it had acquired clypd, a company that helps advertisers move forward in a growing desire by Madison Avenue to run [...]

  • AT&T Logo Building

    AT&T TV Now Price Hike Coming Next Month, Base Package to Cost $65

    AT&T is instituting a substantial price hike for its live TV streaming service AT&T TV Now: Customers who have subscribed to the service’s basic “Plus” package will see their bill go up by $15, to a total of $65 per month, starting next month. The telco has started to inform existing subscribers about the price [...]

  • Disney-Family-Movies

    Disney Family Movies SVOD Service Is Shutting Down Ahead of Disney Plus Debut

    After 11 years, Disney is pulling the plug on Disney Family Movies On Demand — with the service’s shutdown coming just days before the launch of the Mouse House’s Disney Plus. Disney Family Movies, which cost between $5-$10 per month, has been available via pay-TV providers in the U.S., including Comcast Xfinity, Charter Communications, Verizon [...]

  • Amazon Orders ‘All or Nothing: Tottenham

    Amazon Orders ‘All or Nothing: Tottenham Hotspur’ Soccer Doc Series

    Amazon has greenlit a new “All or Nothing” sports documentary series, this time following London-based soccer team Tottenham Hotspur. “All or Nothing: Tottenham Hotspur” will follow a year in the life of the team, charting the ongoing 2019-20 season. The squad made it to the final of the European Champions League last year, losing to [...]

  • Jeffrey Katzenberg

    Jeffrey Katzenberg's Quibi Picks T-Mobile as Wireless Launch Partner

    Quibi, the short-form mobile TV service founded by Jeffrey Katzenberg, announced a pact with T-Mobile to be the official telecommunications partner for its April 2020 launch. T-Mobile will be the exclusive wireless distributor when Quibi launches next spring. However, the arrangement doesn’t mean only T-Mobile customers will be able to subscribe to Quibi: Anyone will [...]

More From Our Brands

Access exclusive content