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Prosecution object to Mega’s choice of lawyer

By | Published on Monday 16 April 2012


US prosecutors have complained about the legal representation chosen by MegaUpload and its boss Kim ‘Dotcom’ Schmitz to defend the company and its former management against the copyright infringement, money laundering and racketeering charges they face. As previously reported, Mega’s existing legal team last week announced they were hiring celebrity lawyer Andrew Schapiro.

He’s an obvious choice in some ways, having worked for YouTube when it was accused of copyright infringement by MTV owners Viacom. In that case, which YouTube ultimately won, the Google-owned video site defended itself under the Digital Millennium Copyright Act, arguing that while it does and always has routinely hosted unlicensed content on its servers, it is users that upload that content, and it removes it once made aware of its presence, thus benefiting from the DMCA safe harbours.

MegaUpload will try to avoid liability for the copyright infringement it enabled using the same arguments. But, interestingly, in the Mega case, the prosecution plan to call YouTube as witnesses as one of the victims of the Mega empire, to discuss allegations Mega routinely scraped the Google-owned site for new content and posted it on its own video-sharing platform, included user-generated content, so that it could claim MegaVideo was primarily a user-uploaded-content site. Prosecutors will also ask Google about why it stopped Mega from carrying its ads system.

Prosecutors reckon that Schapiro having worked for YouTube, not to mention other Hollywood studios that the prosecution intend to call as witnesses, amounts to a conflict of interest. Though Schapiro was having none of it last week, with his firm telling reporters in a statement: “If the government is to have its way in this case, the only lawyers before the court will be those representing the government. If the government is to have its way, the only evidence available to the court would be that cherry-picked by the government, for the government, from the universe of relevant servers slated to be wiped. If the government is to have its way, in sum, MegaUpload will never get its day in court and the case will effectively be over before it has even begun”.

It’s not the first conflict of interest claim to be made against a lawyer representing the Mega team, of course. Shortly after the US authorities swooped, Mega’s reps announced the company had hired the services of another big name lawyer, Robert Bennett, though he quickly had to withdraw from the case because of a conflict of interest with another client represented by the law firm he is affiliated to.

Talking of Schapiro’s legal work for YouTube, that case – ie Viacom v YouTube – was reignited in a way earlier this month, when appeal court judges called for new consideration to be given to one specific aspect of Viacom’s allegations: that early YouTube execs deliberately turned a blind eye to (and, in one case, actually personally engaged in) the upload of unlicensed content to the platform in its early days, because that content was driving most of the service’s traffic.

Those allegations only relate to the early days of YouTube’s operations (as, indeed, did much of Viacom’s eventual lawsuit), and wouldn’t affect the way the Google video site runs today, where a very sophisticated takedown system is in operation. However, if YouTube was found liable for some copyright infringement by operating a deliberately shoddy takedown system in its earlier days, that could have an impact for other user-upload platforms still accused of doing the same thing – including MegaUpload and, for that matter, Grooveshark.

It will be interesting to see if the appeal judges’ ruling means the Viacom v YouTube case will return to court, allowing more discussion about the obligations of digital firm’s relying on DMCA safe harbour protection, or if the two companies – who are engaged in some business partnerships while also fighting this one out in court – reach some sort of settlement without trial.

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