One of The worlds largest file-sharing websites, Megaupload.com, has been shutdown by Virginia federal prosecutors for violating piracy laws. The shutdown happens just one day after Megaupload, Wikipedia, Google, Facebook, among others, voluntarily blacked out their websites to protest against SOPA and PIPA’s anti-piracy legislation.

At one point Megaupload.com was the 13th most trafficked website in the world. The company would allow users to upload and share any type of digital content for free, without having to worry about someone checking to see if what they were sending or receiving was copyrighted material. The company has claimed in the past that they would respond to copyright complaints as they were received.

The Justice department stated, ”This action is among the largest criminal copyright cases ever brought by the United States,”. Megaupload.com’s owner Kim Schmitz who has legally changed his name to “Kim Dotcom”, is accused of costing copyright holders (such as record labels and movie studios) more than $500 million in lost revenue from pirated material.

Eight people and two corporations, Megaupload Limited and Vestor Limited are involved in the indictment. As of today, five of the seven people are already in custody, including the site’s founder Kim Dotcom. Each individual involved in the piracy ring will be facing a maximum penalty of 20 years in prison on racketeering charges, five years for conspiracy to commit copyright infringement, and 20 years on money laundering.

According to the indictment, Kim Dotcom was running an "international organized criminal enterprise allegedly responsible for massive worldwide online piracy,”. It goes on to say that he has generated more than $175 million in “illegal profits” from criminal activities involving Megaupload.com.

Oddly enough, before Megaupload.com was shutdown they were able to get many high-profile celebrities such as Kim Kardashian, Alicia Keys and Kanye West, among others, to endorse their popular file sharing website. Check out the catchy commercial below featuring popular celebrities (who’s work was most likely pirated using the service), explaining how Megaupload.com works.



Most likely not all activity on Megaupload.com was used for illegal activities. I can see many companies or individuals using this simple service to send large files to other people without having to go through the hassle of burning a CD or putting the files on an external hard drive. But I’m also sure that a very small percentage of people using the file sharing service, used it for legitimate reasons.

How do you feel about the crack down? Have you used Megaupload or similar websites to share files? Do you think we will start to see more websites shutting down, especially with bills like SOPA and PIPA trying to come into law? Let us know your thoughts below.

Source: The United States Department of Justice

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Tags: Piracy Ring, file sharing, Megaupload, Megaupload.com, movies, music, piracy, Rapidshare, Shut-down, videos