Analysis: Will Kim Dotcom cut a deal? Here’s what will likely happen

Kim Dotcom is now the only Megaupload accused in New Zealand facing extradition, a decade after the infamous raid. Senior writer David Fisher has covered the case from the beginning and asks: Will Kim Dotcom cut a deal?

Will Megaupload founder Kim Dotcom cut a deal with the FBI over the website accused of costing copyright holders US$500 million?

Extradition is no longer a prospect for three out of the four Megaupload accused.

Dotcom is the remaining obstacle to New Zealand consigning to history an extraordinary saga that has provided an expensive and often unedifying stress test on our legal and political systems.

He became the outlier with news the United States had done a deal with former Megaupload chief programmer Bram van der Kolk and chief technical officer Mathias Ortmann.

The pair will appear in the Auckland District Court on May 19 to face copyright-related charges.

The deal they struck means they will face New Zealand charges instead of continuing to fight extradition to the United States where they would face the FBI indictment.

If they plead, or are otherwise found, guilty then there is light at the end of what was an otherwise endless tunnel. They faced years of fighting extradition and the possibility of decades in prison if sentenced in the United States.

Extradition is also off for Finn Batato, Megaupload’s former marketing director. He has developed extremely serious cancer which may yet claim his life.

It’s hard to see what deal Dotcom could offer or be offered.

He has invested an enormous amount of his public image in opposition to the United States. On Twitter today, he said he would “fight on”, posting a picture of himself in a boxing pose.

“I’m now the last man standing in this fight and I will continue to fight because unlike my co-defendants I won’t accept the injustice we have been subjected to.”

And he is a hard bargainer and the arch dealmaker. If he was to sit down and talk about a deal, what might look like a reasonable middle ground to others might not seem so to him. Those who have dealt with him in business speak of Dotcom’s ability to slice the pie so everyone gets enough – and then wondering at how he again wound up with a lion’s share.

It seems unlikely the United States would want Dotcom to feel he had come out well. Even if a deal were done, it seems likely he would fall hard.

The FBI would have it that Megaupload was a criminal organisation and Dotcom, as leader of that organisation, would be the most culpable.

It was Dotcom who conceived of Megaupload, who drove its development, who used the copyright industry’s biggest stars to literally sing its praises. He pulled in around $60m in 2010 from the company which, the FBI alleges, offered access to movies, music and other copyrighted material.

If culpability was to be judged by income and position, there is no question Dotcom was Megaupload’s only leader. He held 68 per cent of shares (versus van der Kolk’s 2.5 per cent and Ortmann’s 25 per cent). His $60m earnings in 2010 outstripped van der Kolk’s $2m and Ortmann’s $9m.

And there is also Dotcom’s strategy since the 2012 arrest. He has taken a combative approach, haranguing presidents from afar while attacking institutions with accusations of conspiracy and corruption.

Throughout this, Dotcom has also courted some of the United States’ biggest enemies, including Julian Assange and Edward Snowden.

He has a deep and sincere anger towards the United States over the destruction of Megaupload, which he has always maintained was legal and has said was valued at US$2billion at the point it was destroyed.

A deal seems unlikely, at least in the next few years.

The next step in the case will see Minister of Justice Kris Faafoi (or whoever has the role) almost certainly sign the extradition warrant that the Supreme Court says is justified. Faafoi, or a successor, will do so after an extensive briefing from the Ministry of Justice which will cover a range of factors that have to be considered.

Those will include whether Dotcom would face a fair trial and a proportionate jail sentence if convicted. It will consider the life he built here in New Zealand – the five children he’s involved in raising and the sixth currently on the way. It will also consider Dotcom’s health and whether he would receive the medical support required in the US prison system.

Then, Dotcom will appeal against that decision to the High Court, seeking a judicial review over the reasons and reasoning that went into it. Whatever the outcome there, the US or Dotcom will challenge the decision to the Court of Appeal and then the Supreme Court.

More years will fly by. It will go back to another Minister of Justice who will again sign, and there will likely be another challenge as – Dotcom will argue – the reasons to reject extradition have grown even greater.

Van der Kolk and Ortmann will have lived through the worst consequences of the deal they have struck and Dotcom will still be fighting. In their statement today, the two said a reason for striking the deal was “the continuing uncertainty associated with the extradition case” which had “taken a heavy toll on our lives”.

Dealing with that pressure has become a way of life for Dotcom and given how unpalatable a deal with the US might be, it could be the lesser of two evils.

It will not be many years until Dotcom has spent more time fighting extradition than the time Megaupload existed.

The United States calls Dotcom a “fugitive from justice”. He might just stay that way forever – a fugitive in luxury in a mansion outside Queenstown, tweeting his fury and innocence at the world.

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