Megaupload, one of the internet's largest file-sharing sites, has been shut down by officials in the US. The site's founder have been charged with violating piracy laws. Federal prosecutors have accused it of costing copyright holders more than $500m (£320m) in lost revenue. The firm says it was diligent in responding to complaints about pirated material. Investigators denied a link to recent protests against proposed piracy laws, according to the Wall Street Journal. The US Justice Department said that Kim Dotcom, formerly known as Kim Schmitz, and three others were arrested in New Zealand at the request of US officials. It added that two other defendants were still at large.
"This action is among the largest criminal copyright cases ever brought by the United States and directly targets the misuse of a public content storage and distribution site to commit and facilitate intellectual property crime," said a statement posted on the FBI's website.
The charges included copyright infringement, conspiracies to commit racketeering, copyright infringement and money laundering. A federal court in Virginia ordered that 18 domain names associated with the Hong Kong-based firm be seized. Search warrants have been executed in nine countries. Before it was shut down the site posted a statement saying: "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. We have some good ideas. Please get in touch."
On Wednesday, thousands of websites took part in a "blackout" to protest against the Stop Online Piracy Act (Sopa) and the Protect Intellectual Property Act (Pipa). Industry watchers suggest this latest move may feed into the wider debate.
"Neither of the bills are close to being passed - they need further revision - but it appears that officials are able to use existing tools to go after a business alleged to be inducing piracy," said Gartner's media distribution expert Mike McGuire.
"It begs the question that if you can find and arrest people who are suspected to be involved in piracy using existing laws, then why introduce further regulations which are US-only and potentially damaging."
