Media giants join forces to freeze Kim Dotcom

The US government wants to extradite Dotcom, who was arrested in New Zealand on its behalf. Photo / Greg Bowker
The US government wants to extradite Dotcom, who was arrested in New Zealand on its behalf. Photo / Greg Bowker

Music and movie giants have joined forces to freeze Kim Dotcom's assets, but they'll have to negotiate conditions first.

Lawyers appeared at the High Court in Auckland on Monday on behalf of four music industry companies and six Hollywood film studios seeking to have Dotcom's assets frozen ahead of their claim against him.

The record labels are understood to be Warner Music, UMG Recordings, Sony Music and Capitol Records, while the film companies are 20th Century Fox, Disney, Paramount, Universal, Columbia Pictures and Warner Brothers.

The companies say the now defunct file sharing website Megaupload and its key operators, including Dotcom, facilitated, encouraged and profited from massive copyright infringement and want Dotcom's New Zealand assets to remain frozen while their case is under way.

Lawyers appearing for Mr Dotcom and his wife Mona said the estranged pair were prepared to maintain the current freeze, but the companies needed to offer security first.

Mr Dotcom's lawyer Robert Gapes said the companies should put up $250,000 for Mr Dotcom, and a further $250,000 for Mrs Dotcom.

Mark Gavin, who appeared for Warner Music Group, questioned the basis of the $250,000 figure while Matthew Sumpter, who appeared for the film companies, said there was no evidence of any suffering or loss to Mr Dotcom.

But Justice John Fogarty said the amount was "peanuts" for such wealthy clients, and said the Dotcoms could suffer damages by having their capital tied up.

"We're talking very small change here."

He asked the parties to negotiate the conditions of the freeze. If they can't sort it out themselves, they'll be back in court later this month.

In April, an application to extend restraining orders on Dotcom's assets - including cars, jewellery and other property - that have been in place since his arrest in January 2012 was declined.

However, the Crown, on behalf of the US government, appealed the decision to allow Dotcom to get his assets back.

That hearing is due to be held on July 30, and lawyers for the studios want to have their separate application to have Dotcom's assets frozen in relation to their civil case to be heard beforehand, probably in mid-July.

The US government wants to extradite Dotcom, who was arrested in New Zealand on its behalf, so he can face copyright infringement, money laundering and racketeering charges relating to Megaupload.

Ongoing court battles have meant the extradition hearing has been delayed a number of times.

- AAP

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