File-hosting services all around the world will have looked on in horror yesterday as MegaUpload, one of the world’s largest cyberlocker services, was taken apart by the FBI. Foreign citizens were arrested in foreign lands and at least $50 million in assets seized. So what exactly prompted this action? TorrentFreak read every word of the 72-page indictment so you don’t have to, and we were surprised by its contents.
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So the key question this morning is this – What made MegaUpload a rogue site which deserved to be completely dismantled and its key staff arrested? The answers lie in the 72-page indictment and show just how the authorities (with the massive assistance of the MPAA, no doubt) framed Mega’s activities in such a way as to strip it of any protection under the DMCA.
In the U.S., online service providers are eligible for safe harbor under the DMCA from copyright infringement suits by meeting certain criteria.
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Mega had developed a system whereby files set to be uploaded by users were hashed in order to discover if a copy of the file already exists on the Mega servers. If a file existed, the user did not have to upload his copy and was simply given a unique URL in order to access the content in future. What this meant in practice is that there could be countless URLs ‘owned’ by various users but which all pointed to the same file.
Megaupload’s “Abuse Tool” to which major copyright holders were given access, enabled the removal of links to infringing works hosted on MegaUpload’s servers. However, the indictment claims that it “did not actually function as a DMCA compliance tool as the copyright owners were led to believe.” And here’s why.
The indictment claims that when a copyright holder issued a takedown notice for content referenced by its URL, only the URL was taken down, not the content to which it pointed. So although the URL in question would report that it had been removed and would no longer resolve to infringing material, URLs issued to others would remain operational.
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An email sent in July 2008 shows a key staff member reporting an earlier conversation with another entitled “funny chat-log.”
“We have a funny business . . . modern days pirates,” the exchange begins. “We’re not
pirates,” came the reply. “We’re just providing shipping services to pirates.”