In what might be the least shocking court decision in the history of the American legal system, embattled tech entrepreneur Kim Dotcom just learned that a US court will allow the US Goverment to keep $67 million worth of his seized assets. If this ruling is upheld, it could prove to be an insurmountable setback for Mr. Dotcom. He is vowing to appeal.
In case you are unfamiliar with this case, Kim Dotcom (AKA Kim Schmitz) was the founder of a Youtube-like file sharing service called Megaupload. Megaupload basically allowed users to upload and share anything they wanted, including, much to the chagrin of the Motion Picture Association of America, full length HD movies. It was basically the Youtube of pirated content.
The company was operated from a $12,000 per day luxury suite in a 5-star Hong Kong hotel. At the peak of its success, over 50 million people visited the site every day, making it the 13th most visited site on the entire web. Mega hosted 12 billion files held by over 100 million subscribers.
Making And Spending A Mega Fortune
During the lifetime of its operation, Megaupload earned hundreds of millions of dollars from ads and subscription fees. According to court documents, in 2010 alone, the company generated $42 million worth of revenue. In total, the company is believed to have earned a minimum of $200 million.
With this success, company founder and majority owner, Kim Dotcom, was able to live an exceptionally lavish lifestyle. The 6 foot 7, 300+ pound entrepreneur owned a fleet of expensive high performance cars, yachts, private jets and one of the most expensive houses in New Zealand that cost a reported $25 million. He traveled the world with Playboy bunnies and drove around in a Lamborghini that had the license plate "GOD." When he was arrested on January 19th, 2012, authorities seized $5 million worth of luxury cars, including a Rolls-Royce Phantom Drophead Coupe with a price tag of $400,000. Kim's other cars had license plates like "HACKER," "STONED," "GUILTY" and "MAFIA."
Arrest And Downfall
On January 20, 2012, New Zealand police working in conjunction with American authorities launched a raid on Kim Dotcom's mansion. In addition to arresting Kim and his cohorts, the agents seized all of his personal and business assets. They shutdown the domain Megaupload.com with the stroke of a key and seized what eventually totaled $67 million worth of physical assets like cars, houses and planes… and financial assets mostly in the form of 12 bank accounts located all over the world.
Over the next two years, Kim spent more than $10 million defending himself and fighting extradition to the United States. Every step of the way, New Zealand prosecutors have failed in being able to justify his arrest and the destruction of his business. In June 2012, a New Zealand court ruled that the arrest and seizures were invalid. This ruling allowed him to recover approximately $9 million worth of cash and assets. All of which was used to cover his legal fees.
The major issue that Kim has fought over recently is the fact that the US Government still holds $67 million worth of his money and possessions. Kim has been locked in a bitter tug of way with American authorities in an attempt to get his property returned.
In November 2014, Kim announced that he was "officially broke."
Unfortunately for Mr. Dotcom, a US court just announced that it was allowing the US Government to keep the $67 million. Shocking, I know. The main reason the US Courts gave for allowing the US Government to keep the money is because Kim is technically a fugitive in the United States.
With the ruling, a frustrated Kim told reporters:
"By labeling me a fugitive the US court has allowed the US government to legally steal all of my assets without any trial, without any due process, without any test of the merits. The asset forfeiture was a default judgement. I was disentitled to defend myself. First the US judge ruled that I can't mount any defense in the asset forfeiture case because according to him I'm a 'fugitive'."
He further asserted that the US courts were inclined to rule against him because siding in his favor would cause the government of New Zealand a lot of embarrassment. He explained:
"Imagine the embarrassment. They would have had to return everything. Imagine all of the New Zealand media at the mansion when the police has to return everything, all my cars, my TV's, my servers and me directing them where to put my stuff."
That would have been a pretty comical scene. And knowing Kim, he'd certainly relish in the moment by making the entire event a major media spectacle broadcast around the world.
I can't imagine how frustrated he must be. A government in a country that he doesn't live in flew thousands of miles to a country where they have no jurisdiction, and then proceeded to steal all his money and destroy his extremely profitable business. Ignoring the fact that his business was, by most reasonable accounts, facilitating piracy on a massive scale, it's kind of insane that someone's business could be seized and destroyed like that by a foreign power with the stroke of a key. I hope the US government never has a problem with CNW! CNW loves the USA. USA! USA! USA! Please don't bring helicopters to my apartment to seize my Acura.