Case Against Kim Dotcom Copyright Infringement Continues to Weaken
By Staff News & Analysis - January 04, 2013

Kim Dotcom: Mega Will Turn Encryption into a Mass Product … Next month Kim Dotcom will release a new and improved version of the now defunct Megaupload. Today, he unveiled the new look of the site by sharing several teaser screenshots, including one of the encryption interface. Mega, as the new service is called, will turn encryption into a mass product and Dotcom believes that with Mega's help half of all Internet traffic will be encrypted in 5 years. Over the past several months a group of coders have been working hard on the new "Mega" which is scheduled to launch January 20 2013, exactly one year after Megaupload was shut down. – TorrentFreak

Dominant Social Theme: The Fat Man is going down. Just a matter of time.

Free-Market Analysis: When Kim Dotcom was chased into the safe room of his mansion in New Zealand a year ago, the mainstream Western press went into full cry. It was universally assumed that this Falstaffian character would soon be starring in his very own Shakespearian tragedy behind bars in a US jail.

The idea was that Dotcom had made his money with Megaupload (now shut down) by encouraging people to steal copyrighted work and store it in the company's cyber-lockers.

This was the reason the US sent FBI agents halfway around the world to work with New Zealand to arrest Kim Dotcom. The estimate was that Dotcom had cost Hollywood millions if not billions by allowing viewers to pilfer contents.

But today, a year later, most if not all of the US copyright case is in ruins.

  • New Zealand courts have found that surveillance of Kim Dotcom was illegal. So, apparently, was the way the raid was conducted.
  • The Prime Minister of New Zealand has apologized personally to Kim Dotcom.
  • Dotcom has been released from jail and some of his assets unfrozen.
  • Various surveys have shown that users of film (if not music) have consumed LESS rather than more since the shutdown of Megaupload.
  • New Zealand courts found the FBI acted illegally in confiscating Megaupload's servers.
  • The baseline contention that Megaupload abetted information thievery is increasingly a controversial one, as there is no way that Megaupload could police each one of its users.
  • The idea that people can lose the whole of their life's work based on civil/criminal charges that have not yet been proven has provided a timely "wakeup call" to those who did not notice how much the US in particular has eroded civil liberties in the 21st century.

We could go on. There is hardly one element of the US case that has emerged unscathed. And Dotcom continues to fight back. He is now re-launching Megaupload as a bigger and better platform with built-in encryption. Here's more from the TorrentFreak article:

Today, Dotcom revealed the look of the new Mega, showing off the new encryption feature, the registration screen and a new file manager. Speaking with TorrentFreak, Dotcom says the new site is the result of many years' expertise in the file-storage business.

"It's special because seven years of experience have been turned into the perfect cloud storage solution. It scales infinitely. It provides up- and download acceleration and resume in the browser thanks to the latest HTML5 technology," he says.

The encryption part pictured below is perhaps the most exciting feature unveiled thus far. Before users upload their files to Mega they will be encrypted using the AES algorithm. Advanced security, but based on code that will be open source.

"File transfers and storage are encrypted with military strength and you don't have to take our word for it, that part of the code is open," Dotcom told TorrentFreak. Encryption is the future according to Dotcom, who believes that with help from Mega encryption will be the file-sharing standard in five years, accounting for half of all Internet traffic.

"Our easy to use one-click privacy feature will turn encryption into a mass product. We believe within five years half of all Internet traffic will be encrypted with solutions born from our new API," Dotcom says.

"I believe in our rights to privacy and legal sharing. I intend to protect those rights when governments are acting in the interest of corporations rather than society and progress," he adds.

Dotcom's pushback has emboldened an industry. What might have been expected to be a wave of prosecutions of cyber-lockers such as the one that Kim Dotcom operated has not materialized. Additionally, various Megaupload-type vendors are reportedly hesitant to cooperate with wide-ranging government requests to investigate clients.

Most recently, according to TorrentFreak, Megaupload made a filing based on the accusation that the US deliberately misled the court with unlawful search warrants.

In a filing just submitted to court Megaupload is looking to declare the search warrants executed by the U.S. Government unlawful. Kim Dotcom's legal team argues that the Government. deliberately misled the court by withholding information that showed how the authorities had "planted" key evidence. Dotcom is furious about the alleged misconduct that led to the destruction of 220 jobs and the seizure of the personal files of millions of users.

When the U.S. Government applied for the search warrants against Megaupload last year, it told the court that they had warned Megaupload in 2010 that it was hosting infringing files.

Through its hosting company, Megaupload was informed about a criminal search warrant in an unrelated case where the Government requested information on 39 infringing files stored by the file-hosting service.

At the time Megaupload cooperated with this request and handed over details on the uploaders. The files were kept online as Megaupload was instructed not to touch any of the evidence. However, a year later this inaction is being used by the U.S. Government to claim that Megaupload was negligent, leaving out much of the context.

"As of November 18, 2011, thirty-six of the thirty-nine infringing copies of copyrighted motion pictures were still being stored on servers controlled by the Mega Conspiracy," the Government claimed in the Megaupload search warrants.

This course of action is misleading according to Megaupload's legal team.

"Megaupload had every reason to retain those files in good faith because the Government had sought and obtained Megaupload's cooperation in retrieving the files and warned that alerting users to the existence of the warrant and the Government's interest in the files could compromise the investigation," Megaupload attorney Ira Rothken explains.

In a new filing submitted to the District Court, Megaupload informs the court about the Government's failure to disclose the full picture.

All of the above adds up to a series of defeats for the US and Hollywood. But the harsh reality is that the US government is surely a tool of Money Power that runs the world secretively and wants to create public global governance.

It is Money Power that is at war with what we call the Internet Reformation and the information derived therefrom.

Money Power's top people (titled royalty at the time) invented copyright, from what we can tell, after the Gutenberg press began to disseminate information about the Way the World Worked. Today, copyright is being wielded like a weapon to stop certain kinds of information from being disseminated via the Internet.

Frankly, we've been surprised by the brutality and clumsiness that has been used to fight the copyright battle. But this has been in keeping generally with the larger power elite response to the spread of the Internet – something those in charge apparently never expected.

Rather than "take a step back," the top elites (apparently controlling central banks) have become more controlling, using economic chaos, wars and authoritarian regulations to try to intimidate people and prevent them from using the information that has been revealed on the Internet.

That information is what we call "directed history." It seems to show that almost every aspect of Western life has been manipulated over the past century, at least, with the goal of justifying and then creating world government.

This revelation, almost impossible to comprehend, is at the heart of the power elite's desperation – in our view – to shut down the 'Net's free-flow of information. And Kim Dotcom has become a proverbial pawn in this larger game.

The elites – contemptuous as they are – could not have picked a worse target. Six foot six and weighing a gargantuan amount, Kim Dotcom's weight is not the only thing outsize about him: So is his IQ and his confidence in his own abilities.

Even as a teenager, he was prominent in his home country of Germany and everything he's done since then has taken advantage of the reality of the Internet.

Kim Dotcom, for all of his marketing savvy, is far more than just a hyped-up PR man. He is apparently a genuine technology visionary with a knack for practical applications, abiding self-confidence and an ability to project a mirthful PR persona that undercuts any sense of intimidation regarding his groundbreaking applications. This is the man US and Hollywood officials decided to make an example of. Interestingly, they were victims of the same persona that Dotcom has used successfully throughout his career.

A man who so thoroughly advertised his affection for fast cars, large yachts, beautiful women and military video games was someone who surely could not be taken seriously. Such a conclusion reveals not a specific misjudgment but a larger flaw in the perspectives of the hard men who are now in charge of the United States and who work for the larger Money Power that invisibly organizes and directs the West.

It was inconceivable to these intelligence agents and military men that someone as obviously undisciplined as Kim Dotcom would pose a "hard target." Surely he would fold immediately on feeling the boot upon his neck. And this misjudgment was only one of a series. As we total up various exposures of elite dominant social themes, it becomes clear that the "war on copyright infringement" is only of a number of founderings.

There is the "war against climate change," the "war against drugs," the "war against terror," etc. In each case, the Internet has provided information that has undermined the credibility of these memes – and short of shutting down the Internet we don't see how the power elite can stem the tide any time soon.

Of course, one ought to not underestimate what Kim Dotcom is up against. All the forces of history are in a sense leveled against him and the vast resources of Money Power itself. And yet, too, when these forces are misapplied they can turn the average man into a martyr and the above-average man into a kind of secular saint.

After Thoughts

Kim Dotcom is no average man. The resolution to his tale is far from certain. Its telling may be to liberty's benefit.

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