Kim Dotcom claims innocence in bail hearing

MegaUpload's eccentric boss claims his file-sharing site is like YouTube, "promotes creativity"

MegaUpload founder Kim Dotcom, one of several recently arrested by New Zealand police on charges from the US Justice Department ranging from copyright infringement to conspiracy to racketeering, has claimed through his lawyer that he is innocent of the charges brought against him and his company.

"His business did not reproduce or copy material as alleged," claimed Dotcom's lawyer Paul Davison, instead comparing MegaUpload to another online video-streaming site YouTube, which Davison said "promoted [copyright holders'] creativity."

Even so, MegaUpload competitor, FileSonic, has discontinued its file-sharing service in what would seem a clear response to the recent arrests, claiming "All sharing functionality of FileSonic is now disabled. Our service can only be used to upload and retrieve files that you have uploaded personally."

Statements in Dotcom's defense were made at a bail hearing in New Zealand Monday, where a judge deemed Dotcom's case as "too complicated" to either grant or deny bail. The prosecutor claimed Dotcom was a flight risk "at the extreme end of the scale" because of his wealth and his propensity to flee from authorities.

The prosecutor wouldn't be wrong there. Kim Dotcom has been tried for various crimes throughout his life, including hacking into American corporate websites as a teenager and a conviction for insider trading in his twenties. When Dotcom was arrested at his estate Friday, he had barricaded himself in a saferoom from which he had to be cut out by police. Dotcom's lawyer claimed in Monday's hearing he did so because he was "frightened" and "panicked."

Presutors also cited that Dotcom had over 45 credit cards in his possession at the time of his arrest. Dotcom's lawyer said, "My client collects them (credit cards), most of them are out of date."

Kim Dotcom's legal advisor asked that he be released on bail, that he was a low flight risk because his funds and passports had been frozen, as well on account of his instantly recognizable appearance. Kim Dotcom stands 6'6'' and weighs 285 lbs. "He is not the sort of person who will pass unnoticed through our customs and immigration lines and controls," said Dotcom's lawyer.

"Given the breadth of issues covered in this bail application and the seriousness of the issues, I am going to reserve my decision," the judge said, saying he would give a ruling no later than Wednesday.

The indictment has claimed that MegaUpload took in over $100 million over a span of five years, from premium membership fees and other payments.

MegaUpload functioned by allowing users tp upload copyrighted film, television, or music files. Other users could then find these files and either upload them or stream them, either on free or premium accounts. The company claimed "more than 150 million registered users, 50 million daily visitors and accounting for four percent of the total traffic on the Internet," according to a DOJ statement.

US and New Zealand police have seized upwards of $175 million in assets in 64 bank accounts around the world, as well as a large collection of Dotcom's possessions, including automobiles, gadgets, and computer servers. Arguably the most popular of them, MegaVideo, is currently offline.

While it's still questionable whether Kim Dotcom -- in all his eccentricity and, let's face it, sleaziness -- should be imprisoned for his wildly popular file-sharing website, his lawyer's comparison of MegaUpload with YouTube is extremely dubious. YouTube is much more vigilent about taking down copyrighted material than MegaUpload, a company the entire function of which is to give users access to material otherwise out of reach.

If that's the best that Kim Dotcom's lawyers can do, these charges might just stick.