NZ 'intertwined' in US Megaupload case

19:27, Jul 27 2012
John Key, Chris Finlayson and Anne Tolley
WHO KNEW WHAT WHEN? Prime Minister John Key was told the day before the January 20 raid; Attorney-General Chris Finlayson knew 'some weeks' before the raid; Police Minister Anne Tolley also received verbal briefing the day before the raid.

Kim Dotcom's United States-based lawyer, Ira Rothken, will today ask a Virginia court to throw out the case against Megaupload on the grounds that the global file-sharing website has never had a physical office in the US.

Mr Rothken says the actions of the New Zealand Government are tangental to the hearing, but would not be raised until a later hearing, although he is "cautiously optimistic" the case will be dismissed.

So what was the involvement of the New Zealand Government in the FBI-requested raid? And was it, as Dotcom has suggested, in cahoots with the US Government and the American film industry to bring down Megaupload and its flamboyant creator?

Several ministers, including Prime Minister John Key, have now revealed they knew before the New Zealand police executed a dawn raid on January 20 at Dotcom's Coatesville mansion that US authorities wanted to extradite the German multimillionaire.

Mr Key has said he didn't even know about Dotcom, although he lived in Mr Key's Helensville electorate, until he was told about the FBI case the day before the raid.

A handful of government agencies knew: the request for police assistance was received by the Ministry of Foreign Affairs, then forwarded it to Crown Law, which obtained arrest warrants through the courts.


Crown Law advised Attorney-General Chris Finlayson "some weeks" before the raid, but his office is purposely vague.

Minister of Police Anne Tolley received a verbal briefing the day before 70 police officers, including the armed offenders squad, swooped on Dotcom's mansion.

Despite the Ministry of Foreign Affairs' involvement, its minister, Murray McCully, was not told in advance, and Immigration New Zealand officials reportedly passed information to the Overseas Investment Office about the FBI case just before Dotcom's application to buy property was rejected in July last year.

Dotcom has claimed his arrest was the result of US Vice-President Joe Biden personally ordering the closure of Megaupload on behalf of his friends in the film industry, which was working with the New Zealand Government.

Mr Biden is apparently a close friend of former senator Chris Dodd, who now heads the Motion Picture Association (MPA).

In a story which made headlines around the world, Dotcom has recently claimed that Mr Biden met Mr Dodd, Hollywood studio executives, and MPA Asia head Mike Ellis in June last year.

Mr Ellis, who it is claimed is also an extradition expert and former superintendent of the Hong Kong police, then flew to New Zealand and met the Minister of Justice at the time, Simon Power.

It has been claimed on websites that Mr Power then reportedly ordered the New Zealand police to raid Dotcom's home.

It is widely known that Mr Power did intervene in Dotcom's life. A month after he met Mr Ellis, he went against advice from the Overseas Investment Office and rejected Dotcom's application to buy the $30 million former Chrisco mansion.

Documents released under the Official Information Act show Mr Power did not believe that the 38- year-old, who was granted residency in November 2010 after investing $10m in government bonds - despite a string of foreign convictions - met the good-character requirements.

If Dotcom's claims sounds like a far-fetched conspiracy theory, a former press secretary to Mr Power says they are.

BRENT Webling confirms that Mr Power met Mr Ellis, but says they discussed changes made to the Copyright Act two months earlier, which introduced a three-notice regime to discourage illegal file sharing. "He never had anything to do with the FBI. The whole thing is a bit fanciful really."

The information received about Dotcom's chequered past was enough to raise Mr Power's suspicions that something "was not quite right", Mr Webling said.

The Government will not comment on Dotcom or his claims, because his case remains before New Zealand courts.

However, a Government source says that from the Beehive's perspective, Dotcom is not a political issue.

"It is simply an extradition process. It's an issue for the courts and the agencies."

Claiming that a senior politician ordered a police raid was essentially an allegation of corruption, the source said.

"It doesn't work that way. If it did, then we are a central African republic."

Mr Rothken says it is too early to say how things will play out in court in the eastern district of Virginia, where the US Government laid charges against Dotcom of conspiracy to commit racketeering, copyright infringement and money laundering, as well as criminal copyright and abetting copyright infringement.

However, he says events in New Zealand are "intimately intertwined" with legal proceedings in the US because New Zealand was acting on behalf of the US Government.

Mr Rothken argues that Dotcom's case is a matter for the both police and the courts - and the Government - particularly after the High Court last month ruled search warrants to seize property from Coatesville were illegal and it was unlawful for the FBI to take hard-drive data offshore.

"When you have New Zealand police breaking down the door of a New Zealand resident's home and ransacking and taking just about everything out of it, with an unlawful search warrant . . . that's not just a matter for the police and that's not just a matter for extradition. That's a matter that goes to the heart of Government, which is to protect its citizens from unlawful intrusions.

"There is concern over whether or not New Zealand exercised sufficient checks and balances on the police and provided their own scrutiny of the assertions that the United States was making in order to protect the rights of New Zealand residents."

Dotcom could yet sue both the New Zealand and US governments for the wrongs he believes were committed against him, Mr Rothken says.

It has been reported Dotcom could seek up to $50 million, but Mr Rothken will not divulge specifics.

"Certainly, Mr Dotcom is concerned about the conduct of the New Zealand Government, as most New Zealanders ought to be."

The Dominion Post