Six of the biggest US movie studios have filed a copyright infringement case against the defunct file-sharing site Megaupload and its founder Kim Dotcom over alleged massive intellectual property theft.
According to the Motion Picture Association of America (MPAA), they have alleged the site and its operators "facilitated, encouraged, and profited" from copyright infringement of movies and television shows.
Global general counsel of the MPAA and senior executive VP, Steven Fabrizio, said that when Megaupload.com was shut down in 2012 by US law enforcement, it was by all estimates the largest and most active infringing website targeting creative content in the world.
"Infringing content on Megaupload.com and its affiliates was available in at least 20 languages, targeting a broad global audience," Fabrizio said.
"According to the government's indictment, the site reported more than $175m in criminal proceeds and cost U.S. copyright owners more than half a billion dollars."
Plaintiffs in the suit, filed at US District Court for the Eastern District of Virginia, included Twentieth Century Fox Film, Disney Enterprises, Paramount Pictures, Universal City Studios Productions, Columbia Pictures Industries and Warner Bros Entertainment.
In their suit against the file-sharing site, they are reportedly seeking unspecified damages and legal fees, claiming they are entitled to Megaupload's profits and about $150,000 for every copyright infringement.
"Megaupload was built on an incentive system that rewarded users for uploading the most popular content to the site, which was almost always stolen movies, TV shows and other commercial entertainment content," Fabrizio added.
"It paid users based on how many times the content was downloaded by others - and didn't pay at all until that infringing content was downloaded 10,000 times."
The lawsuit comes as Dotcom is combating a bid by US authorities to expel him from New Zealand to serve online piracy charges over the defunct website. He is also known as Kim Schmitz and Kim Tim Jim Vestor, according to the lawsuit.
The file sharing service was also accused of costing film studios and record companies over $500m while generating over $175m by promoting paying users to store and share copyrighted material.