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SCOTUS Rejects Chance To Give Ruling On Civil Forfeiture

REUTERS/Yuri Gripas

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Anders Hagstrom Justice Reporter
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The U.S. Supreme Court affirmed federal civil forfeiture practices Monday when justices rejected a challenge from a New Zealand-based internet mogul who claims the government has wrongfully taken his property.

Kim Dotcom is the founder of the now-defunct streaming website Megaupload, which was shut down on copyright charges in 2012. Federal prosecutors filed a forfeiture case against Dotcom’s assets soon after the website went dark, immediately taking possession of his U.S.-based property and petitioned Hong Kong and New Zealand to do the same. In a civil forfeiture case, the federal government prosecutes property rather than an individual, and the property is presumed guilty unless its owner can contest and prove the property’s innocence.

Dotcom argues that forfeiting his property without a criminal conviction is a violation of due process, TRT World reported.

The case hinged on Dotcom’s classification as a criminal fugitive, a label slapped on him by the FBI following his 2012 indictment. The FBI points out that Dotcom was not in the U.S. to face criminal charges.

Individuals are typically only classified as fugitives when they flee a country, and Dotcom’s legal team has shown that the mogul has never been to the U.S.

Nevertheless, federal prosecutors used Dotcom’s fugitive status to prevent him from contesting the forfeiture of his assets, an as a result, the federal government essentially has the free reign to keep all of Dotcom’s property. (RELATED: Police In These States Have The Most Freedom To Take And Keep Your Property)

The court’s rejection of his appeal upholds a lower court’s decision for the U.S. to forfeit $40 million in assets so long as it was in connection with criminal charges.

Dotcom and other Megaupload executives cost film studios and record companies more than $500 million by encouraging customers to upload and share copyrighted movies, TV shows, and other content, Federal prosecutors allege. Prosecutors also seek profits garnered by Megaupload, which they value at more than $175 million.

Dotcom was disappointed but not surprising by the rejection, telling Reuters that cases typically have only a slim chance of appearing before the Supreme Court. He is now challenging U.S. calls for the extradition of his assets in Hong Kong.


Dotcom’s future remains uncertain, however, as a New Zealand court ruled in February that he and other Megaupload executives could legally be extradited to the US.

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