Supreme Court declines to hear Kim Dotcom forfeiture case

The U.S. Supreme Court has declined to hear a challenge brought by foreign internet tycoon Kim Dotcom in response to the government’s attempt to seize tens of millions of dollars in overseas assets for operating Megaupload, a now defunct file-sharing site at the center of an massive international copyright case.

The high court’s decision Monday to pass on Mr. Dotcom’s request for judicial review — a denial of a petition for a writ of certiorari, shorthanded by Court watchers as a “denial of cert”  — effectively upholds previous rulings authorizing the government to seize about $40 million worth of assets in connection with the Justice Department’s ongoing case against Megaupload — the largest criminal copyright case in U.S. history, according to federal prosecutors.

Previously one of the most popular sites on the internet, Megaupload shuttered in Jan. 2012 as the result of an FBI-led investigation that ended in racketeering and criminal copyright infringement charges for Mr. Dotcom, a 43-year-old German citizen, and three of his colleagues — Finn Batato and Mathias Ortmann, both from Germany, and Bram van der Kolk, a Dutch national — for allegedly cheating Hollywood out of a half-billion dollars by running a website designed to facilitate the wide-scale distribution of pirated materials.

All four members of the so-called “Mega Conspiracy” were subsequently arrested in New Zealand and ordered to stand trial but have managed so far to avoid extradition. The Justice Department filed a forfeiture action in the interim seeking millions of dollars in assets from Mr. Dotcom allegedly linked to the conspiracy, spurring the international legal challenge rejected by the Supreme Court this week.

Mr. Dotcom argued that the U.S. couldn’t seize the property of a foreign citizen living abroad without first taking him to court, but the Justice Department said he couldn’t contest the order on account of being a fugitive refusing to stand trial. The Fourth Circuit Court of Appeals upheld that ruling in 2016, prompting Mr. Dotcom’s attorneys to file a certiorari petition in April rejected by the high court this week.

“We are disappointed in the denial of the cert petition—it is a bad day for due process and international treaties,” Mr. Dotcom’s attorney, Ira Rothken, told Reuters.

“Kim Dotcom has never been to the United States, is presumed innocent, and is lawfully opposing extradition under the United States-New Zealand Treaty—yet the United States by merely labeling him as a fugitive gets a judgement to take all of his assets with no due process,” Mr. Rothken told Ars Technica. “The New Zealand and Hong Kong courts, who have authority over the assets, will now need to weigh in on this issue and we are cautiously optimistic that they will take a dim view of the Fugitive Disentitlement Doctrine and oppose US efforts to seize such assets.”

Mr. Dotcom said the court’s rejection wasn’t surprising since it only considers only a limiter number of cases each term, Reuters reported.

“Fortunately most of my assets are in Hong Kong and HK courts won’t allow forfeiture of my assets simply because I legally oppose extradition,” he tweeted. “I’m grateful because my mind allows me to create new assets whenever I want.”