The Megaupload Debacle
I often use the word debacle for hyperbolic effect. I’ll describe awkward social interactions or attempts in the kitchen as debacles. But the way the government has handled the Megaupload case seems to be a debacle in the truer sense of the word: as defined by the Oxford English Dictionary, “a sudden and ignominious failure; a fiasco.”
In the case of Megaupload, the debacle is two-fold. First, there are serious constitutional and sub-constitutional issues with the government’s behavior. For the purposes of this post, I will stick to the constitutional legal issues as they illustrate the broader themes that have turned this case into such a fiasco. Second, the Megaupload episode creates a number of practical issues in the short and long term – for Megaupload users and operators and users of cloud services generally. I will discuss a couple of these too.
But first, a bit of history. Feel free to skip ahead if you’re already up to speed with story of Kim DotCom and the demise of his Mega Empire.
A brief history of the Megaupload situation
There has been much ink spilled in tech mags and rags on what happened to Megaupload and its odd owner, Kim DotCom. The short of is this:
- Megaupload is a cyberlocker. It's a place where you store large amounts of data remotely so that you can access it from any device, at any time, and if you so desire, share it with other people.
- Some people used Megaupload for allegedly illegal purposes. (I say “allegedly” not because I think there’s any question as to whether the service was used, by some, for illegal purposes, but rather because no court has formally ruled that Megaupload was used for illegal purposes.)
- Others did not. For example, author Alex Beecroft explains, “I used MegaUpload a lot in order to send perfectly legal high resolution book cover art which I made with legally bought stock photos over to publishers so they could put them on their books. The high resolution files were simply too big to send in an email. How am I going to get my cover art to its legal purchaser if people keep taking down file sharing sites just because some bozos are using them illegally?” Other examples are shared by Ars Technica and TechDirt.
- The FBI went after Megaupload and now U.S. prosecutors have blocked access to Megaupload’s various sites and have charged seven men with charges ranging from racketeering, conspiracy to commit copyright violations, conspiracy to commit money laundering, and multiple charges arising from criminal copyright infringement.
- The indictment was issued January 5, 2012. On January 19, 2012, the DoJ shut down Megaupload.
- After shutting down the entire website, on January 27, 2012, the DoJ sent a letter to Megaupload’s lawyers saying:
Now that the United States has completed execution of its search warrants, the United States has no continuing right to access the Mega Servers. The Mega Servers are not in the actual or constructive custody or control of the United States, but remain at the premises controlled by, and currently under the control of, Carpathia and Cogent. Should the defendants wish to obtain independent access to the Mega Servers, or coordinate third-party access to data housed on Mega Servers, that issue must be resolved directly with Cogent or Carpathia. It is our understanding that the hosting companies may begin deleting the contents of the servers beginning as early as February 2, 2012.
- That’s right. So every user at Megaupload effectively got screwed. The good ones and bad ones alike. But the story, thankfully, doesn't end there. Megaupload users have been granted a temporary reprieve from imminent loss of property when both Carpathia Hosting and Cogent Communications agreed not to delete any Megaupload data for at least two weeks. And they are working with the fine folks at EFF to help sort out a way for folks to get their information back.
The Constitutional issues
4th Amendment
- The Constitution protects our right to be secure in our “persons, houses, papers, and effects, against unreasonable searches and seizures.” Security means that the government doesn’t get access to our papers or effects without a legally obtained warrant.
- The government seized the property of law-abiding people without a warrant. That property may not have searched by the government, but the government definitively seized it between January 19, when it shut down the site, and January 27, when it transferred control to the hosting server companies. And now, because they seized control of Megaupload and shut down its services without notice or plans for helping users retrieve their data, many people’s personal papers and effects are now inaccessible to them.
1st Amendment issues
- The First Amendment prevents the government from limiting our right to free speech. By shutting down an entire platform for communication and creativity instead of targeting the unprotected speech that was traversing across the platform, the government unfairly and unjustly infringed on the First Amendment rights of Megaupload users.
5th Amendment issues
- The Fifth Amendment guarantees a right to both procedural and substantive due process. Procedural due process means that the government must provide notice and an opportunity to be heard before taking away our life, liberty or property. Substantive due process concerns the protection of fundamental rights understood by but not specifically enumerated in the Constitution. The scope of substantive due process is amorphous, but includes a right to privacy that protects against government intrusion into our most private affairs. Both of these are at least partially at issue. There has been a taking of legally owned property (though the government has now withdrawn any interest or claim to the property) with neither proper notice nor an opportunity to be heard. Additionally, it may be argued, though it’s a long shot, that as our right to privacy extends fundamentally to what we do in our homes, this right protects who we privately communicate with from our computers and the materials we share with them.
- There’s also an interesting takings issue that Evan Brown flagged on his blog. Under the 5th Amendment, the Government cannot take private property for public use without just compensation. While the Government was quarantining and reviewing files stored on Megaupload’s servers, the government had functionally take private property for public use without just compensation. That said, I don’t think this line of logic will hold up, mostly because of the questionable distinction between public use and police power that Brown points to as discussed on Volokh Conspiracy a couple years ago.
The practical issues moving forward
The Short Term: The problem of the data hot potato
Of course, now that the government has executed the warrant, it no longer retains actual or constructive control over the information on Megaupload servers. Now, unfortunately, the government has not reinstated the site to allow people to access their information. Since the government can’t help reconnect legitimate users of the service with their data (for one thing, it is (likely) outside the scope of the warrant to even look at their files), that leaves Megaupload or the hosting services that rented server space to Megaupload. The latter prospect seems dim, as noted by Carpathia in one of its recent press releases, “Carpathia does not have, and has never had, access to the content on Megaupload’s servers.” Thankfully, the hosting provider wants to “assist lawful users of the Megaupload service.” Carpathia has agreed to keep the data up for a short period of time (though it has no legal obligation to do so, and is likely not getting paid by Megaupload, whose bank accounts have been frozen, to do so) and is working with EFF, to help Megaupload customers obtain legal assistance so that they might get their data back. Megaupload might be able to help, though I'm not sure it will. It’s out of business and its terms of service states (according to Wired) users “have no proprietary interest in any of the files on Megaupload’s servers” and that “Megaupload can terminate site operations without prior notice.”
Even with Carpathia working with EFF, its still a giant mess – do users make a list of all the content that’s theirs, attest to the accuracy of the list, and then submit it to Carpathia? What happens if people lie? What happens if people ask for their illegal content back? Does Carpathia have to obtain permission from users before it accesses their data to determine who the rightful owners are? How would it obtain that permission?
The Long-Term: The future of cloud services
The Megaupload debacle changes the ball game of cloud services. One of the things that got Megaupload in trouble was that they allowed users to share their cyberlockers. As Kashmir Hill describes, “The New York Times said the crackdown ‘sent shivers down the spines’ of other online storage sites, such as Dropbox, Mediafire, and Rapidshare, since their models, like Megaupload’s, could also allow users to share pirated material. While RapidShare is unconcerned, at least one file-sharing site was scared straight out of its business model. As of Friday, FileSonic was “the world’s best file-sharing site….Over the weekend, the site, based out of the UK and Hong Kong, disabled its sharing function, so that users can only ‘upload and retrieve files that you have uploaded personally.’ Its tagline now identifies it only as ‘the unlimited storage company.’”
The shutdown of Megaupload threatens any company that provides legitimate cloud services. It also threatens people’s livelihoods and our ability to communicate. A closer look at how people legally use file sharing sites, like Megaupload, give some insight into the industries and activities that would suffer if cloud services companies fear legal action and prohibit file sharing or if the government continues to shut down file sharing sites and seize people’s data. The anecdotes below are all taken from an Ars Technica article I linked to earlier, but here it is again. In each of the following examples, Ars provides a concrete example of common, legal activities that could disappear if file sharing in the cloud does not remain a robust, easy to access service.
- Publishing (and Sharing Pictures and Videos with Family):
“A book editor named Cassandra Olivia says graphics designers and editors she works with use Megaupload to exchange files for review, and that she uses it herself for sharing family and vacation photos with relatives who are ‘just technologically adept enough to click on a link.’”
- Legitimate Music Development and Sharing:
“Another reader tells us of accessing Phish concert MP3s—which are distributed legally because the band permits recording.
“Professional musician Suzanne Barbieri e-mailed us to note that she used Megaupload to store and share music in part because most of her projects ‘are too large for something like YouSendIt”…. “‘I do session work in my home studio and upload the files so the clients can download them,’ Barbieri says. ‘The work I do for them is usually urgent with tight deadlines, so I have to be able to upload files. A courier service would be too expensive and too slow. I also use Megaupload to get my own music to my record label.’”
- Code Sharing and App Development
“Another reader tells us in the forums that ‘I’m an Android phone enthusiast, and Megaupload was one of the best ways to distribute custom ROMs and other Android mods. In fact, the ROM my phone is running right now I downloaded from MegaUpload shortly before it was shut down. There are a number of similar sites for this use, but Megaupload was always the fastest.’”
“Massimiliano Fanciulli tells Ars ‘I’ve used Megaupload for distributing betas of my app Sleepy before publishing it on the Android Market. It was quick and easy to upload and share things.’”
- Activism and Litigation
“‘We do a decent amount of video stuff here and so I have to move too-big-for-email files around with some regularity,’ staff attorney Michael Weinberg of Public Knowledge tells Ars in an e-mail. ‘I like sites like Megaupload because they do not require an account—you just upload it, get the link, and send it out. It is also easy to tell other people to use it because you do not need to make a new account.’ Public Knowledge is a prominent SOPA opponent, and Weinberg was using Megaupload throughout the SOPA debate and right up until yesterday’s action against Megaupload. ‘As luck would have it, over the weekend I used my home laptop to pull down the stream of the House Judiciary Committee SOPA markup,’ Weinberg says. ‘I wanted to transfer it here to work so that I could cut it up into a video we were using. I uploaded it, but before I had a chance to download it Megaupload was shut down. I can't speak for everything happening on the site, but Megaupload was providing me a completely legitimate service for a completely legitimate end.’”
Those are my quick thoughts on Megaupload debacle. It has raised serious legal issues, serious practical concerns, and has potentially equated, in the minds of some, file sharing behavior with illegal behavior. A fiasco in the true sense of the word.
