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RIAA Revs Up Lawsuit Against Megaupload

Music industry trade group accuses file-sharing site of "rapid, unrestricted downloading of popular, infringing content"

Kim Dotcom
Hannah Peters/Getty Images
April 14, 2014 5:00 PM ET

The giant square jaw of illegal music downloading belongs, these days, to Kim Dotcom, the German former hacker whose Megaupload.com allegedly enabled sharing of $500 million worth of copyrighted material. Two years after the U.S. Department of Justice raided his New Zealand mansion, indicting him for building up $25 million a year in ads and $150 million from premium fees, the Recording Industry Association of America recently announced that it would be piling on with a new lawsuit. The RIAA, which has spent the last 15 years suing Napster, Grokster, LimeWire and their users, accused Megaupload of allowing users to engage in "rapid, unrestricted downloading of popular, infringing content."

Megaupload Busted as Piracy War Heats Up

"It's just sort of a psychology — once you start litigating, and you have a winner, why stop?" asks Larry Kenswil, a Los Angeles attorney who was a digital executive at major label Universal Music during the original Napster era. "I'm not sure there's a downside of continuing it."

Dotcom, who has since launched a Megaupload successor called Mega, has positioned himself since the late-2012 indictment as a quasi-Internet martyr: "They're treating us like a Mafia, man!" he told Wired in late 2012. He responded on Twitter to the RIAA's lawsuit with similar language: "Copyright extremists are having a party on #Megaupload's corpse after the witch hunt and public burning of a totally legal cloud storage site."

Neither Dotcom nor reps for his new company, Mega, returned inquiries for comment for this story. An RIAA spokesperson wouldn't comment, although the record-industry group is circulating data attributing a drop in illegal file-sharing to Megaupload's 2012 shutdown. (The figures are attributed to "an analysis by the RIAA of third party-provided data.") It's unclear how much these events, and how much a popularity boost in free streaming services such as Spotify and YouTube, have led to the drop in illegal downloading activity.

Either way, Dotcom and Megaupload remain easy targets for entertainment-business groups such as the RIAA and the Motion Picture Association of America, which filed a similar suit last week. "The combination of the publicity of Megaupload, as well as the criminal investigation giving them a head start, made this one a relatively easy call  as opposed to having to reinvent the wheel [by suing] some other sites," says Brad Newberg, an intellectual-property attorney in Washington, D.C. "A lot of people know about it."

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