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Megaupload.com shut down; piracy alleged

McLEAN, Va. -- One of the world's largest file-sharing sites was shut down yesterday, and its founder and several executives were charged with violating piracy laws, federal prosecutors said.

An indictment accuses Megaupload.com of costing copyright holders more than $500 million in lost revenue from pirated films and other content. It was unsealed one day after websites including Wikipedia and Craigslist shut down in protest of two congressional proposals intended to thwart online piracy.

The Justice Department said Kim Dotcom, formerly known as Kim Schmitz, and three other executives were arrested yesterday in New Zealand at the request of U.S. officials. Two others are at large.

In Congress, senators were abandoning an anti-piracy bill after an outpouring of online opposition to tinkering with Internet freedoms. Democratics still plan to vote Tuesday on taking up the Protect International Property Act. Supporters were scrambling to make changes to answer criticism. Whether they had the 60 votes needed was uncertain.

Megaupload was unique not only because of its size and the volume of downloaded content, but also because it had high-profile support from content producers who are most often the victims of copyright infringement and piracy. Before the website was taken down, its endorsers included Kim Kardashian, Alicia Keys and Kanye West.

The Hong Kong-based company listed Swizz Beatz, a musician who married Keys in 2010, as its chief executive. He was not named in the indictment and, through a representative, declined to comment.

Before it was taken down, the site posted a statement saying allegations that it facilitated massive breaches of copyright laws were "grotesquely overblown."

"The fact is that the vast majority of Mega's Internet traffic is legitimate, and we are here to stay," the statement said.

The site boasted 150 million registered users.

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