Megaupload Drops Universal Suit, Details Emerge Around Founder's Arrest

Chris CrumTechnology

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As we reported last month, popular file hosting site Megaupload filed a lawsuit against Universal Music Group over claims that UMG abused YouTube’s automated copyright infringement reporting system to take down a video posted and owned by Megaupload.

Our own Josh Wolford reported about the video:

The RIAA and MPAA, in their push to rid the internet of what they dub rampant piracy, have set internet storage locker sites like MegaUpload firmly in their crosshairs as well. While saying that a site like MegaUpload is illegal would likely spawn quite a bit of debate, copyright holders obviously see it as part of the problem.

A group of artists have contributed their two cents to a campaign promoting the usefulness and likability of MegaUpload – and it’s a rather impressive group of artists at that. P. Diddy, Snopp Dogg, Alicia Keys, Kanye West, Lil Jon, Jamie Foxx, Brett Ratner and Mary J Blige are just a few of the stars that have voiced their support for the site in an incredibly odd yet somehow catchy song aptly titled “The Mega Song.”

As WebProNews' Shaylin Clark noted:

The video was produced entirely by Megaupload, and contains no content owned by any other party. That fact, however, did not stop Universal from reporting the video to YouTube for copyright infringement. YouTube immediately took down the video. When Megaupload re-posted it, UMG again reported it, resulting in a second takedown of the video and threats by YouTube to suspend Megaupload’s account as a repeat offender.

Today, the Hollywood Reporter is reporting that Megaupload has dropped its suit against UMG.

Of course, Megaupload has been in the news a lot since that suit was filed. The site was taken down by the Justice Department, which led to Anonymous taking down multiple government sites.

The site's founder "Kim Dotcom" was arrested on Friday in New Zealand, and today, Reuters shared some comments from Detective Inspector Grant Wormald from the Organised and Financial Crime Agency New Zealand:

"Despite our staff clearly identifying themselves, Mr Dotcom retreated into the house and activated a number of electronic-locking mechanisms."

"Once they gained entry into this room, they found Mr Dotcom near a firearm which had the appearance of a shortened shotgun. It was definitely not as simple as knocking at the front door."

According to the report, firearms were seized, as well as over $8 million from financial institutions, and the FBI reportedly claims Dotcom made $42 million from Megaupload in 2010 alone.

Apparently, Dotcom has been arrested on insider trading and embezzlement charges in the past, as well.

Chris Crum
Chris Crum has been a part of the WebProNews team and the iEntry Network of B2B Publications since 2003. Follow Chris on Twitter, on StumbleUpon, on Pinterest and/or on Google: +Chris Crum.