Dotcom employee finishes jail term

While Kim Dotcom, Finn Batato, Bram van der Kolk and Mathias Ortman. await the judge’s decision on their extradition to the US another person involved in Megaupload who gave himself up is just finishing his prison sentence.

David Fisher at NZ Herald wrote Free but $266 million in debt: The deal that gave the FBI an inside man who could testify against Kim Dotcom

As Kim Dotcom waits for a judge to decide if he will be extradited to face criminal copyright charges, a former employee is walking out of jail after serving time on the FBI accusations the internet tycoon continues to deny.

Andrus Nomm had three years of anxiety over the charges resulting from the FBI operation against the filesharing business They were claims of a vast criminal copyright conspiracy operated through one of the world’s most popular websites.

Then, earlier this year, Nomm ended the waiting by cutting a deal with United States prosecutors. The result – a 366-day sentence (with an early parole), three years of supervision and a US$175 million judgment.

A database of federal prisoners has Nomm listed as due for release today.

In return, US prosecutors got an inside man – a staff member of one of the Megaupload co-accused who would testify against Dotcom and the others.

So the worst of Nomm’s sentence is over while Dotcom and associates have the extradition still hanging over them. If that goes against them will presumably take the battle to appeal, and if that goes against them thery will have to go to the US to face trial and a possible sentence far longer than Nomm’s.

They were arrested nearly four years ago, in January 2012.

Dotcom’s future now over to judge

The Kim Dotcomn (and others) extradition hearing concluded today. It is now up to the judge to make his decision.

NZ Herald reports: Kim Dotcom extradition hearing reaches conclusion

Now Judge Nevin Dawson has the unenviable task of wading through hundreds of pages of evidence and hours of submissions to make the decision on whether the internet entrepreneur and his three co-accused are sent to the United States to face a trial.

The FBI laid charges in January 2012 when Dotcom, Mathias Ortmann, Bram van der Kolk and Finn Batato were indicted on 13 charges including copyright infringement, racketeering, money laundering and fraud.If found guilty, the men could face lengthy jail terms.

The German-born mogul was not at Auckland District Court today to see the climax of the case. He tentatively limped out of court yesterday grimacing with back pain after a fall at home and his attendance was excused.

Judge Dawson will now have to decide whether the defendants have a case to answer in the US.

He does not have to decide whether they are guilty or even likely guilty – the threshold is lower.

If, on the face of it, he rules there is some merit in the US government’s charges and a case to answer, on the face of it, the quartet will be sent overseas.

But if Dotcom loses this it would be surprisuing if he didn’t appeal.

Judge Dawson today said he would give an abridged version of his decision in open court before releasing his written judgement.

He did not indicate when that would likely take place.

Anxious times for Dotcom, Ortmann, van der Kolk and Batato – it would be quite a situation to be in with your future dependant on what one judge decides, with no idea when you will find out.

The raid and arrests were in January 2012, nearly four years ago.


Dotcom fails to delay extradion hearing

Dotcom’s extradition hearing will resume next week.

Kim Dotcom’s lawyers have failed to get his extradition hearing delayed and will begin their defence next week

Radio NZ: Dotcom’s bid to stop extradition hearing rejected

Kim Dotcom’s bid to stop his extradition hearing has been rejected and his lawyers will open his defence on Monday.

In a ruling released late this afternoon, Judge Nevin Dawson said he would not hear full arguments of the application to have the extradition hearing halted now and his full reasons will be released at the end of the hearing.

The defence will open their case on Monday.

Dotcom on Twitter:

Maradona and Dotcom no use for world cup

In The World’s Cup: NZ asked to risk it all at NZ Herald Steve Deane makes fun of Diago Maradona with some help from Kim Dotcom.


Trust the Daily Mail to break down the Australian victory over Argentina perfectly for its audience. “Diego Maradona left disappointed after Argentina crash out of Rugby World Cup” screams a Mail headline. “Diego Maradona was sent through an emotional rollercoaster on Sunday as he watched Argentina fall to a 29-15 defeat by Australia in the Rugby World Cup semi-final.

The former footballer, 54, has watched his country’s progress throughout the tournament and provided a colourful presence in the crowd; but even his eccentric performances weren’t enough to stop the South American’s from bowing out in the last four.”

Strange indeed that a fat bloke jumping up and down excitedly in the stands wasn’t enough to sway the outcome of a rugby match. Pretty sure John Key would have slapped a jersey on Kim Dotcom and called off the extradition proceedings years ago if it was.

Turns out the Mail didn’t actually speak to Maradona, instead basing its story on a series of photos that were either the great man or a blue and white beachball that had somehow spouted a head.

Maradona is certainly not as athletic looking as he used to be, but neither is ex-All Black Michael Jones.

Dotcom claims National killed Campbell Live

The Herald has an item previewing a John Campbell exclusive “I was devastated” due out in Metro today that gives Campbell’s views on the demise of Campbell Live earlier this year.

John Campbell breaks his silence: I was devastated we couldn’t make show work

John Campbell has finally spoken of the dramatic cancellation of his show Campbell Live and his subsequent departure from TV3, saying his axing came as a shock and left him grieving.

“I still feel sad about it,” he said. “It wasn’t about me or my career or anything, because what I believe we created was a model of constructive, illuminating, empathetic television that also had enough going for it to commercially be sustainable. And I was devastated by our inability to make that work.”

There’s no mention in the Herald article about Kim Dotcom but he refers to it in a tweet:

Kim Dotcom Retweeted nzherald

Your brave investigative journalism about my case killed your show. National killed it. I’m so sorry .

So Dotcom is claiming his story killed Campbell Live, and somehow National is responsible. I’ve seen this claimed on the activist left but I’ve never seen it substantiated close to adequately.

Dotcom could claim his story mortally wounded the Mana Party election chances but somehow I doubt he was responsible for all the ratings problems of Campbell Live and TV3 (Story is a similar story with no stories done on Dotcom).


Crown argues extradition hearing should proceed

The Crown are arguing that the Dotcom extradition should proceed and Dotcom’s arguments that he says require expert witnesses should be for the his trial in the US.

Radio NZ reported today:

No grounds for Dotcom hearing delay, says Crown

Kim Dotcom’s arguments for putting off his extradition hearing are defences that should be raised at his trial, says the Crown.

A hearing has resumed today to decide whether Mr Dotcom and three other men should be sent to the United States to face copyright violation, money-laundering and racketeering charges.

The men have asked the North Shore District Court to delay or even halt the proceedings, saying the US has prevented them from hiring expert witnesses they needed to defend the extradition attempt.

But Crown lawyer Christine Gordon, who is representing the US, said the court only needed to be satisfied there was a case against the men on the face of it.

Ms Gordon said the evidence expert witnesses could provide was relevant to a trial, but not the extradition hearing.

So this approach doesn’t surprise me at all.

EDITED: I didn’t read the report carefully enough initially so have amended it.

Dotcom – bad budgeting or botched basket case?

Kim Dotcom’s legal team is holding up his extradition hearing, arguing for a stay of proceedings.

One argument is that Dotcom is being prevented from mounting an adequate defence because his funds have been frozen. They say he needs $750,000 to pay for expert witnesses from the US.

However a Herald report says that Kim Dotcom sold shares to pay for defence.

Dotcom’s US attorney Ira Rothken said they would need about US$500,000 to get the people they needed and it could take up to six months to gather all the evidence required from them.

Kim Dotcom sold shares in his new companies for about $20 million in 2013 to pay for his defence team and provide for his family, he has told a court.

He told the court about setting up Mega Ltd with Ortmann and van der Kolk and music company Baboom in 2013, shares in which he sold for about $20 million.

Dotcom said the ventures were “born out of necessity” to pay for the drawn-out extradition battle and also to secure his family’s future with contributions to the family trust, the Trust Me Trust.

So Dotcom wants yet another delay because he hasn’t got $750k left out of $20 million to pay for his defence.

Dotcom said he donated up to $4.8 million during its brief existence and Mr Ruffin asked why he had not put some of that money aside to pay for US legal experts he now claimed were vital to defending his case.

“If I had a crystal ball and I could see the future, in hindsight I could have done that,” Dotcom said.

“But at the time, for me, there was no reason to believe there wasn’t more unrestrained funds coming from my business ventures.”

Didn’t he already already have restraints on funds internationally?

In any case why wouldn’t he make sure he had budgeted adequately from available funds to do what he wanted to defend himself from extradition?

His ill-fated involvement in the Internet Party was also discussed.

Dotcom said he donated up to $4.8 million during its brief existence and Mr Ruffin asked why he had not put some of that money aside to pay for US legal experts he now claimed were vital to defending his case.

“If I had a crystal ball and I could see the future, in hindsight I could have done that,” Dotcom said.

“But at the time, for me, there was no reason to believe there wasn’t more unrestrained funds coming from my business ventures.”

Of course if he had a crystal ball he would have seen that pouring $4.8 million into a political attempt to hold the balance of power in New Zealand’s Parliament was nuts and wouldn’t have wasted it.

Mr Ruffin also asked the defendant why he had not used money from living costs to pay for the experts he claimed he needed.

“If I wanted to be homeless and sack all my staff and kick my kids out of school I could’ve done that, yes,” Dotcom said.

Maintaining a lavish lifestyle was more important to him than budgeting to defend his extradition?

Does he think he’s doomed anyway so might as well spend his money before it is taken from him?

I hope his lawyers have checked that he has budgeted to pay them.

Or – was Dotcom banking on buying political power to prevent his extradition and put all his eggs in that basket so didn’t worry about funds for a legal defence?

His political eggs are broken and on his face.

The court will decide whether his budgeting story stacks up. To me it looks like a case of botched optimism in the Internet Party play.

Recorded conversations sound bad for Dotcom

Conversations recorded between co-accused of Kim Dotcom sound bad for them but this is before the defence has addressed them. 3 News reported on the second day in court:

Prosecutors: Skype conversations show Dotcom guilty

Judge Nevin Dawson is hearing evidence in Auckland District Court on whether Dotcom, Mathias Ortmann, Finn Batato and Bram van der Kolk should be surrendered to US authorities.

Dubbed the “Mega Conspiracy” by the FBI, US authorities allege the four made $US175 million by facilitating and encouraging piracy on their file storage website, Megaupload, and related sites.

On Friday Christine Gordon QC, who is acting for the US, read an extensive series of Skype conversations and emails between the men, arguing they revealed they knew the business was a criminal enterprise from the start.

And here are excerpts from some of the conversations.

“The fact is when there’s no way out, Kim will also grab the last couple of millions and go on hiding mode again when that happens,” Van der Kolk was quoted as telling Ortmann.

“The likeliness of us getting in trouble for some reason is getting bigger.”

Ms Gordon read a message from Dotcom suggesting the group urgently hire a lawyer to fend off lawsuits.

Ortmann replied they should just “promise some kind of technical filtering crap and then never implement it”.

In dozens of other quotes Ms Gordon went over, Dotcom described the group as “evil”, Van der Kolk said he always lived from “piracy” and the accused acknowledged the vast majority of the content going through their site was piracy.

“If copyright holders would really know how big our business is they would surely try to do something against it,” Ortmann was quoted as saying.

More than half of the viewing traffic on the site was associated with repeat infringers and Dotcom called them “the special people”, Ms Gordon said.

“That’s the big flaw in the rewards programme: we are making profit off more than 90 per cent infringing files,” Van der Kolk told Ortmann over Skype.

Some of this doesn’t sound good but the defence is yet to respond.

Ms Gordon said the site paid bonuses to copyright infringers using the service, rather than banning them, and then presented an innocent facade while defrauding copyright holders by telling them files were being taken down – when in reality they were uploaded in other locations.

The company paid more than $3 million to uploaders, according to the FBI.

This is basically how I understood the case to be.

While it sounds bad I have no idea how this stacks up against extradition law. I do know that extradition has a lower burden of proof than a trial, it just has to show there is a case to answer.

Eighteen months ago I posted on the responsibilities and record of the Minister of Justice (then Judith Collins) on extraditions which has links to extradition information plus has links to case details.

Dotcom to face extradition starting Thursday

Kim Dotcom has failed in delaying his extradition hearing any more and it will begin on Thursday.

3 News reports: Dotcom loses bid to delay extradition hearing

A last-minute attempt to delay the extradition hearing for internet entrepreneur Kim Dotcom and his co-accused has been rejected.

Judge Nevin Dawson has released a decision that means evidence will be heard when the case resumes in Auckland District Court on Thursday.

On the first day of the hearing yesterday, lawyers for Dotcom and his co-accused asked for the extradition evidence to be pushed back so several applications to stay the case could be heard beforehand.

They alleged an FBI freeze on money being paid into the US has kept them from hiring legal and industry experts in the country.

But Christine Gordon QC, for the Crown, told Judge Dawson many of the claims were “speculative” and would only unnecessarily delay proceedings by weeks.

She asked for them to be heard as part of the hearing, or afterwards.

In his decision, Judge Dawson said the applications by Dotcom and his co-accused would be better heard during the main hearing because it would put them in context.

The outcome of their applications would not be prejudiced by the order and they could always appeal, he said.

If extradited and found guilty in the US, the four men face charges that carry decades of jail time.

They include conspiracy to commit racketeering, conspiracy to commit money laundering, wire fraud and two kinds of criminal copyright infringement based on an FBI investigation going back to 2010.

Judge Dawson doesn’t have to decide whether the four are guilty or not, only if they could be surrendered to the US to face charges there. The justice minister then makes a decision on the matter.

So nearly four years after being raided and detained Dotcom finally faces actual extradition proceedings. I expect this will be lengthy, and if Dotcom is unsuccessful it’s very likely he will appeal.

Minto’s letter to Dotcom – everyone else’s fault

John Minto has posted an Open letter to Kim Dotcom at The Daily Blog – wishing Dotcom luck in his extradition case and blaming everyone else for everything that’s gone wrong.

He prominently promotes the revolution that failed:


Kia ora Kim,

Good luck with defending the government’s extradition case against you this week. Whatever the outcome in the District Court I’m sure it will end up in the Supreme Court eventually so there’ll be a lot of water to go under the bridge yet.

You are facing the wealth, power and wrath of corporate America because you provided an efficient means for people to share files on line which allegedly included some copyrighted songs and movies as is done on many internet platforms.

A class struggle. The poor people should be able to take what they like.

But instead of taking a civil claim against you Hollywood’s corporate moguls want to make an example of you. They want you in jail forever as the modern-day equivalent of the body left hanging on the scaffold for the vultures or the severed head on a pike… Don’t mess with us is their Mafiosi-type message.

A fairly extreme comparison. It’s possible (but is currently unproven) that Dotcom and his company profited from the encouraging of illegal downloads.

The political environment in which your case is heard is more critical than what the law says. A case of alleged copyright infringement has no basis for extradition hence the desperate claims of “conspiracy” and “racketeering”. If our courts have honesty, courage and backbone they will toss this out as a corporate-inspired abuse of legal process.

I’m not sure that’s how extradition law works. Conspiracy theories don’t count unless backed by evidence.

The truly embarrassing aspect is just how our GCSB (Government Communications Security Bureau) and police fell over themselves to help out corporate America with their keystone-cops raid on your home. That’s an issue which will be addressed only when New Zealand withdraws from the five eyes network and develops an independent foreign policy. It won’t happen tomorrow but it will happen.

Off on a hobby horse tangent.

Your millions and uber-capitalist lifestyle are a turnoff to me but during the election campaign I was impressed with what I took as your genuine commitment to the progressive policies of Internet MANA.

A commitment by providing his millions – noted by many as an embarrassing contradiction for Mana.

Had you wanted us to change MANA policies – even with a single comma – we wouldn’t have had a bar of any relationship with the Internet Party. From our point of view your campaign donations that came with no strings attached were welcome. In contrast Labour and National’s very existence depends on corporate money which in turn depends on them adopting corporate-friendly policies.

Money from multiple donors to National and Labour bad. Millions from one donor with obvious self interest good. Good grief.

I have always disagreed with your analysis of the election outcome. It was not your so-called “poisonous politics” which defeated Internet MANA or lost Hone Harawira his seat as MANA MP. In fact the strategy MANA adopted in our decision to go into a strategic alliance with the Internet Party was a successful strategy. Hone gained more votes in last year’s election than he gained in the previous 2011 election and Internet MANA gained significantly more party votes than MANA received by itself in 2011.

(Hone’s vote in Te Tai Tokerau increased from 8,121 in 2011 to 8,969 in 2014 while the MANA vote in the Maori electorates increased from 25,889 to 29,207. The Internet MANA party vote increased by roughly 50% from the MANA 2011 party vote – up from 24,168 to 34,094)

The strategy failed. Harawira lost his seat and Internet-Mana failed to reach the 5% threshold by a long way. That’s not successful.

What lost Hone his seat was the political establishment of right-wing Labour MPs, the Prime Minister, National Party, Maori Party and Winston Peters all urging their supporters to back Labour MP Kelvin Davis. For most of the Labour Party leadership the highest priority at the election was to drive MANA out of parliament. Had Labour been able to get close to government it would have needed the extra seats Internet MANA could have brought to a Labour-Green-Internet MANA government. However Kelvin Davis preferred to be a backbench MP in a losing party than be part of a winning team to change the government.

Blaming Davis for campaigning hard and winning Te Tai Tokerau on merit for himself and his own party instead of rolling over for Mana and Dotcom is politically very naive.

Despite the election outcome I remain proud of the risk MANA took in the relationship with the Internet Party. We did so with our eyes open and as I said that aspect of our campaign was successful.

Failure is not success for most people. Perhaps for Minto it is.

I think where the Internet Party made a serious error of judgement was in the handling of the “moment of truth” meeting at the Town Hall a week out from the election. It was a “moment of truth” in its revelations of mass surveillance of New Zealanders by the US National Security Agency but this was buried in the media’s expectation of a more detailed revelation of John Key’s knowledge of your case much earlier than he claimed.

I agree on that, Dotcom’s grand campaign killer blow strategy was a disaster.

In any case that issue was never going to go far. Key has lied and dissembled so often about his memory on a whole range of issues that he would simply have shrugged his shoulders and most media would have accepted it and moved on quickly.

Fixated as they are on trivial political sideshows the mainstream media ignored the issue of mass surveillance and launched a tsunami of negative publicity – led by the Herald and TV3 – which swamped the Internet MANA campaign and dropped the party vote to less than two percent when it had been up to four percent a month earlier.

Blaming failure that was supposedly a success on everyone’s scapegoat, the media. An essential part of politics and election campaigns is managing media. Internet-Mana failed at that too.

Fixated as they are on trivial political sideshows the mainstream media ignored the issue of mass surveillance and launched a tsunami of negative publicity – led by the Herald and TV3 – which swamped the Internet MANA campaign and dropped the party vote to less than two percent when it had been up to four percent a month earlier.

The media did cover mass surveillance to an extent but it was sideshow amongst many election issues. Hoping to succeed in an election on a single issue that most people don’t care about is failure.

Your case has already been of importance to this country in helping reveal the extent of lying and illegal mass surveillance of New Zealanders conducted by the GCSB.

To an extent, yes.

This week it will be important for another reason. It will be a litmus test not of yourself and your internet activities but of just how independent our courts are.

Every court case is a test of the independence of our courts. Cases with well funded PR campaigns involved in particular.

Going by the way Minto has blamed everything and everyone else for Internet-Mana’s election failure there’s a high chance that if Dotcom fails to avoid extradition our courts will be blamed along with the evil USA and big business.

Minto is like others on the far left fringe thinking their cause is so just that if everyone was informed properly they would have their revolution – failure is success that is everyone else’s fault.


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