Megaupload founder Kim Dotcom appears in court

After U.S. authorities shut down popular file-sharing site Megaupload last week, it’s founder Kim Dotcom appeared in a New Zealand court Monday. Sarah Halzack reports:

Kim Dotcom will remain in custody at least temporarily after a New Zealand judge delayed a decision on whether the founder of the file-sharing site Megaupload.com should be permitted to be released on bail, according to published media reports.

Video

Kim Dotcom and his co-defendants in the Megaupload case appeared in an Auckland court Monday, which heard arguments over their bail requests. Dotcom's lawyer said his client was innocent of internet piracy and money laundering charges. (Jan. 23)

Gallery

Sites they claim to have breached: A day after many Web sites participated in a protest against the SOPA anti-piracy bill, the Justice Department announced it was shutting down file-sharing site Megaupload.com over piracy violations. Soon after, Anonymous took credit for shutting down the federal agency’s Web site. Here’s a look at other cyberattacks the informal hacking group has claimed credit for.

At a hearing Monday in Auckland, New Zealand, Dotcom denied that he is guilty of the Internet piracy charges he is facing in the United States. The New Zealand Herald reports that Dotcom’s attorney, Paul Davidson, argued that his client should be eligible for bail because “he is not a person who is inherently motivated to disappear or breach conditions. There is no flight risk.”

Ultimately, Reuters reported, the judge wanted more time to make his decision about the request, “given the breadth of issues covered in this bail application and the seriousness of the issues.” The judge said his final decision would come no later than Wednesday.

FBI officials are seeking to have Dotcom and three of his cohorts extradited to the United States, where they would face charges of Internet piracy and money laundering. The charges are related to the file-sharing Web site Megaupload.com, which was shut down Jan. 20 as part of the indictment.

Shortly after news spread of the Justice Department’s action, that federal agency’s Web site went down, as did the site of Universal Music. The outages were a result of a cyberattack from the informal hacking collective known as Anonymous, which went after the sites in retaliation for the crackdown on Megaupload.

Meanwhile, FileSonic and FileServe removed their sharing features in the wake of the Megaupload indictments. Tom Cheredar reports:

After employees of file-sharing services Megaupload were arrested, similar digital locker services FileSonic, FileServe, and others have stopped allowing users to share the files they upload with others.

The “cyberlocker” provided by these companies is essentially a cloud service that allows people to upload a number of different files that can be shared/downloaded by others for a limited period of time (or permanently for premium customers).  The move to shutter this functionality by FileSonic, FileServe, and others is undoubtedly a response to legal action taken against competing site Megaupload, which was shut down last week under accusations of piracy by the U.S. Department of Justice in conjunction with government authorities from many foreign countries.

“All sharing functionality on FileSonic is now disabled. Our service can only be used to upload and retrieve files that you have uploaded personally,” FileSonic states on its website — meaning you can no longer download any file you didn’t personally add to the service.

Also gone is the affiliate rewards program many of these sites offer. This reward program pays its users a fee for getting other people to download the files that you upload to the site. If you’re a third-party firm that needs to share large files with clients over the internet, a site like FileSonic is a good alternative to e-mail. If you’re getting paid by the number of files downloaded, you can see why some professionals might find FileSonic alluring. However, the same can be said about these reward programs for people who illegally upload copyrighted content (movie, songs, etc.).