By DEVLIN BARRETT
WASHINGTON—The Federal Bureau of Investigation shut down Thursday one of the world's most popular file-sharing websites, MegaUpload.com, and announced the arrest of four of the people behind it in a global crackdown against the suspected online pirates.
The move pushed the raging piracy debate to new territory: the role of online 'lockers' where users around the world store and share material, often times pirated movies and music. The raid came a day after Washington lawmakers were besieged by complaints about legislation designed to crack down on offshore file-sharing services. Internet sites like Wikipedia and Google Inc. protested the legislation as censorship.
The Indictment
See the court filing against MegaUpload.com.MegaUpload, which is based in Hong Kong and was knocked offline Thursday, claimed it had 50 million daily users. The site lets individuals upload files—anything from a document to a digital movie—and provide Internet links that other individuals can use to download a copy. It charges for memberships that give users faster and unlimited amounts of transfers.
Lawyers for MegaUpload couldn't immediately be reached.
Seven people have been charged with online piracy crimes in an indictment unsealed in northern Virginia. Four of those suspects, including the site's alleged founder and senior executives, are already in custody, authorities said.
The four were arrested in New Zealand. Federal agents and other law enforcement agencies simultaneously moved to search bank records and server farms in multiple locations around the globe, authorities said. The charges include conspiracy to commit racketeering and criminal copyright infringement.
MegaUpload.com is already engaged in a legal fight with Vivendi SA's Universal Music Group over a promotional video featuring some UMG artists, including Kayne West, Mary J. Blige, Kim Kardashian and others. Universal filed a lawsuit to have the video removed from YouTube saying the video violated its copyrights.
The site's chief executive has been reported to be music producer Swizz Beatz, whose real name is Kaseem Dean and who is the spouse of Alicia Keys. Mr. Dean wasn't named in the indictment. A spokeswoman for Everest Entertainment, which is distributing an upcoming album by Swizz Beatz, had no immediate comment.
On a "frequently asked questions'' section of the website, MegaUpload acknowledges that some have criticized its practices, but insists it is an above-board business. "The fact is that the vast majority of mega's Internet traffic is legitimate, and we are here to stay. If the content industry would like to take advantage of our popularity, we are happy to enter into a dialogue,'' the website reads in part.
The Justice Department paints a different picture.
According to the indictment, MegaUpload is responsible for at least $500 million in losses for the owners of the copyrights in question. The indictment calls the company "a worldwide criminal organization whose members engaged in criminal copyright infringement and money laundering on a massive scale.''
Investigators estimate that MegaUpload's piracy business has earned them more than $175 million, according to the indictment.
