The FBI closed down the file-sharing site Megaupload Thursday, charging seven individuals with operating an international business based on digital piracy, The Wall Street Journal reported. Four Megaupload employees in New Zealand, including the founder, were arrested on charges of conspiracy to commit racketeering and criminal copyright infringement. The other three named in a grand jury indictment are at large.

The hacktivist group Anonymous responded to the arrests by attacking the websites of the Department of Justice, the Motion Picture Association of America, the Recording Industry Association of America and several entertainment companies.

And then it was reported that the acting CEO of Megaupload is Swizz Beats, hip hop producer and husband of Alicia Keys.

Megaupload is charged with costing copyright owners more than half a billion dollars. According to the indictment, the company received more than $110 million in membership fees and other revenue over five years. U.S. authorities are trying to seize property, including a 2010 Maserati and a 2008 Rolls Royce, as well money in bank accounts.

Industry observers, including Nate Anderson at Ars Technica, have noted that in some ways Megaupload is a curious target for authorities.  YouTube has been the subject of similar allegations regarding copyright, but nobody has sought to have YouTube employees arrested.

"Given that the site was already using US courts to file actions; given that the government had Megaupload e-mails talking about using US lawyers to file cases against other 'pirate' sites; given that the site did at least take down content and built an abuse tool; and given that big-name artists support the site, the severity of the government's reaction is surprising," Anderson writes.  

U.S. officials said the arrests were not timed to coincide with the debate over the highly controversial Stop Online Piracy Act (SOPA) in the House of Representatives and the Protect IP Act (PIPA) in the Senate, the Journal reported. The bills would ban U.S. companies from providing links, funds or advertising to foreign websites involved in piracy. They would also grant the Department of Justice authority to keep U.S.-based web visitors away from pirate sites.

For more:
- see The Wall Street Journal article
- see this HipHopBlog post
- see Nate Anderson's post at Ars Technica

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