according to wikipedia, megaupload wuz some sort of fancy inferweb site, where folks could go to download pornography. 50 million visitors a day, 81 million unique visitors, more than 1 billion total views, 180 million registered users, and once the 13th most-visited site on the net. the shutdown came just hours after the mass online protest of the SOPA bill (originally scheduled to be voted on Jan. 24, but has since been postponed)
the Federal Bureau of Investigation arrested Kim Schmitz (Founder), Finn Batato (CMO), Mathias Ortmann (CTO and co-founder), with Bram van der Kolk arrested by the Organised and Financial Crime Agency of New Zealand. their bail request was denied in New Zealand court, as it was opposed by US authorities on the case. on January 20, Hong Kong Customs froze more than 300 million Hong Kong dollars (US $39 million) in assets belonging to the company.
the suit alleges that they made millions (estimated at $175 million) off the trafficking of copyrighted material, but there is plenty of gray area, as well. money laundering charges include the lumping in of basic payments for web hosting, which are in no way illegal.
as one analyst put it “much of the indictment seems to be based on the simple assumption that encouraging more usage means they must be encouraging infringement, and that there should be evidence of actual wrongdoing, not merely evidence of popular use.” many legitimate files are popular and popularly shared, and an implicit assumption that paid use largely equates to infringing use would need evidence.
while infringing activity may be occurring, it may not be possible (or reasonable to require) the host to know and identify what activity is legitimate or not. File sharing may be used by many content creators. emails show infringing activity took place, but it takes place on other sites, such as Youtube.
more on this story here