Kim Dotcom sues New Zealand Government for up to $6.8b

Tech entrepreneur Kim Dotcom is suing the New Zealand Government for up to $6.8 billion – claiming it destroyed his business and damaged his reputation.

$6.8 billion is about 3.5% of New Zealand’s annual GDP.

The German-Finnish founder (real name: Kim Schmitz) of file-sharing site MegaUpload was living in New Zealand when the Government colluded with US authorities went after Dotcom on copyright infringement and money-laundering.

In 2012, Dotcom’s house was raided on January 20 and his business MegaUpload closed down, with US authorities calling it a haven for online piracy.

Dotcom’s argument is that an invalid warrant was used to arrest him.

They were based on Section 131 of the 1994 Copyright Act of New Zealand. – and this section does not explicitly state that online copyright infringement is unlawful.

Hence, Dotcom says, all charges laid against him are also invalid.

According to court documents filed by him, “The Attorney-General, Crown Law and the Police knew or were recklessly indifferent to the fact that the Arrest Warrant was unlawful and would, if issued, cause harm to the plaintiffs.

“As a result of the Arrest Warrant being unlawfully issued, the plaintiffs have suffered the loss pleaded at paragraphs 215-232 hereof.”

If Megaupload was still in business, it is estimated it would be worth $10 billion. Dotcom owns a 68% stake in it.

He also wants to be compensated for all lost business opportunities since 2012, as well as massive legal costs and loss of his investment in his rented mansion which he had been hoping to buy.

"I cannot be expected to accept all the losses to myself and my family as a result of the action of the New Zealand Government," Dotcom told the BBC.

"This should never have happened and they should have known better. And because they made a malicious mistake, there is now a damages case to be answered."

Dotcom is also currently fighting extradition to the US, where he faces up to 20 years in prison for alleged copyright infringement, racketeering and money laundering.

US authorities say the activities of Dotcom and others led to the loss of $500 million to record companies and film studios, while they made $175 million for themselves.

In 2015, in a blow to Dotcom’s team, a NZ court ruled he could be extradited.

The next round in the long running case is set for hearing on February 20 at the Appeals Court.

His new micro-payments business, Bitcache, is preparing to launch an initial coin offering (ICO) in the next three months, underwritten by crowdfunding investment platform Bank To The Future.

The company is set up separate to Dotcom so it won’t be affected if he is forced to go to the US.