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Kim Dotcom Just Went from Broke to $80K a Month Thanks to a Hong Kong Judge

The Mega founder now has the cash to fight his case for much, much longer.
December 3, 2015, 7:24pm

A Hong Kong judge has come to the rescue of Kim Dotcom, the accused internet pirate and founder of Megaupload.

With Dotcom running low on cash and his ability to pay his legal fees in doubt, Hong Kong's High Court granted him access to some of his money there, according to the South China Morning Post.

Wilson Chan Ka-shun, the Hong Kong judge who issued the ruling, has allowed Dotcom to receive a monthly amount equivalent to $80,000 New ZeaIand dollars ($53,000 USD) to pay living and legal expenses, the Post reported.

The US Department of Justice (DOJ) is unlikely to be happy with the decision. In 2012, the DOJ indicted Dotcom and six other Megaupload managers for criminal copyright violation and related charges. Among the prosecution's claims were that the men generated $175 million from their cloud-storage service by encouraging and enabling users to illegally swap digital movie and music files. A DOJ spokesman declined to comment.

For nearly four years, Dotcom has managed to hold off the DOJ's attempts to extradite him and three other Megaupload managers from New Zealand. Prosecutors initially froze all the defendants' assets, alleging that the money was ill-gotten gains. New Zealand, however, allowed the Megaupload managers to draw from their local accounts to pay living and legal expenses. For Dotcom, that money recently began to dry up, he claimed.

When Dotcom made a second fortune on Mega, a successor file-hosting service to Megaupload, the top Hollywood movie studios filed a lawsuit and froze those assets as well. At a hearing this fall to determine whether New Zealand would surrender Dotcom and the other defendants to US authorities, he told the court his financial situation was dire.

Dotcom lived in one of New Zealand's most expensive mansions. He owned multiple cars and his household staff at one time topped 50 workers. He was unemployed for three years.

That Dotcom found himself short on funds was not an accident, according to him. In September, the 41-year-old German national said in an interview that the US and New Zealand governments, as well as the big film studios, had conspired to choke off his resources to try and force him to drop his defense.

"These guys don't know me," he said then. "I know how to fight."

That's an understatement. At the hearing in Hong Kong, the prosecutor told the court that Dotcom lived extravagantly and paid $27,000 in New Zealand dollars for rent, and $41,000 for household expenses. He said Dotcom was leading a "Roll's Royce lifestyle."

The judge said that he was satisfied that Dotcom had fully disclosed his finances and "not able to meet his own expenses," the judge said, according to the Post.

What the Hong Kong decision means is that Dotcom can continue to lead that lifestyle. It means that no matter which way Nevin Dawson, the presiding judge in the New Zealand extradition case, rules, Dotcom has the money to appeal if he loses and challenge a DOJ appeal if he wins. It means he can continue the draw out this case for God knows how long.