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Megaupload Ltd was a Hong Kong -based online company established in that operated from to providing online services related to file storage and viewing.
On 19 January , the United States Department of Justice seized the domain names and closed down the sites associated with Megaupload after the owners were arrested and indicted for allegedly operating as an organization dedicated to copyright infringement. His lawyer said they would appeal to the New Zealand Supreme Court. On 19 January , Megaupload was re-launched as Mega under the domain name mega. The re-launch date was chosen to coincide with the one-year anniversary of Megaupload’s takedown by the U.
Federal Bureau of Investigation. The company web services included Megaupload. Other services included Megaclick, Megafund, Megakey and Megapay, all of which were advertisement and financial services.
Along with this, four blogs were created including Megabest and Megaking. Two additional services—Megabackup and Megamovie—were in development before their closure. Megakey was an adware application which removed bandwidth limitations on Mega services during “happy hour” periods.
In return, the users running Megakey agreed to supply some personal identification and demographic data and to allow the substitution of ads on third party websites they visited with those of Megaupload. Megabox, a new form of media downloading site, was the first of its kind. Kim “Dotcom” described Megabox as “very similar to iTunes” except that it operated in a web browser using HTML5 technology and loaded “much faster than iTunes or anything else out there”.
FileBox was a Flash applet that could be embedded onto any external webpage. It allowed users to upload content to Megaupload without having to visit the website itself or download the Mega Manager. Although incorporated in Hong Kong, the company did not operate in Hong Kong. From onward, users with Hong Kong IP addresses were banned from accessing the site.
The reason for the block was never disclosed by Megaupload,  but Hong Kong Customs officials have suggested that the block was an attempt to hinder law enforcement investigation. As of 23 May , access to Megaupload was intermittently blocked by the internet authorities in Saudi Arabia by their regulator Communications and Information Technology Commission. In July , access to Megaupload and Megavideo were blocked in India for Reliance Entertainment customers,  after a court order was obtained, citing illegal copies of the film Singham on file hosting sites.
On 19 January , U. For a short time after the closure of the site, users could access material via Google’s web cache and The Internet Archive. One day after the indictment Google and Archive. In January , MarkMonitor published a report entitled “Traffic Report: Online Piracy and Counterfeiting”, which said that Megaupload and Megavideo were, along with RapidShare , the top three websites classified as “digital piracy”, with more than 21 billion visits per year.
Megaupload Toolbar was said [ by whom? It was also said to contain spyware. When a file was uploaded to Megaupload and another file with the same hash was already found to exist, the uploader would be asked if they would like to link to the already existing file. Therefore, a single file may have contained multiple links to it. This caused some controversy, since when a DMCA takedown notice was issued only the link that was provided was removed; not necessarily the file itself.
Megaupload said that the video contained no infringing content, commenting: “we have signed agreements with every featured artist for this campaign”. Federal Bureau of Investigation that the four be extradited for racketeering and money laundering. The crown argued against bail on the basis that he was a flight risk with a helicopter on his front lawn, while defence lawyers argued that the helicopter could not fly far enough to reach another country.
They also said that Dotcom denied any criminal wrongdoing. Judge David McNaughton expressed concern at the discovery of two shotguns at Dotcom’s mansion during the police raid,  and deferred a decision on whether to grant bail, saying that he needed more time to review the submissions. Dotcom would flee jurisdiction and the possibility that if he reached Germany he wouldn’t be extradited to face the charges”. On 22 February , North Shore District Court Judge Nevin Dawson overturned the previous rulings and granted bail to Kim Dotcom,  saying that the risk of flight had diminished after his assets had been seized.
On 5 March , a formal request for the extradition to the United States of Kim Dotcom and three other senior Megaupload staff was filed in a New Zealand court. The assets in 63 bank accounts and around thirty other vehicles remained in custody. The restraining order on his property was granted in April During April , US district court judge Liam O’Grady stated “I frankly don’t know that we are ever going to have a trial in this matter,” as he found out that the company had never been formally served with criminal papers by the US.
On 28 June , New Zealand High Court judge Justice Helen Winkelmann ruled that the search warrants used to raid the home of Kim Dotcom were invalid, saying “The warrants did not adequately describe the offences to which they related. They were general warrants, and as such, are invalid.
On 10 July , a decision on whether Kim Dotcom and other Megaupload employees should be extradited to the United States was delayed until March , in order to allow further time for legal arguments to be heard.
Key commented “I expect our intelligence agencies to operate always within the law. Their operations depend on public trust. On 8 September , the Court of Appeal ruled that the New Zealand Police is to return seized electronic devices unencrypted back to Dotcom and those involved. On 23 December , New Zealand judge Nevin Dawson ruled that Kim Dotcom, as well as three of his colleagues, can be extradited to the United States to face copyright infringement charges.
Dotcom’s lawyers said they would appeal the decision. The indictment   alleged that Megaupload differed from other online file storage businesses. Media reports covering the case highlighted several points from the indictment used to support claims of illegal activity. The indictment provided instances alleged to show criminal behaviour, as well as indicating design points of Megaupload’s operating model as being evidence of criminal intent : .
Defense attorney Ira Rothken says that the raid was unjustly swift and did not give his client the opportunity to defend himself, quoting a similar case involving YouTube as an example of a completely different turnout.
Legal commentators point out that while the indictment may be correct and Megaupload might have acted as a criminal conspiracy as said, a number of points in the indictment are based upon selective interpretations and legal concepts described in one article as “novel theories” of the law  and could be challenged in court.
A Los Angeles Times analysis stated that the author was “struck by how far the indictment goes to find something nefarious”;  likewise a TechDirt analysis concluded that while the founder of Megaupload had a significant history of “flounting the law”, evidence has potentially been taken out of context or misrepresented and could “come back to haunt other online services who are providing perfectly legitimate services”.
The legal concerns included:. Safe harbor does not exist if the site has actual knowledge and does nothing about it. In Megaupload’s case, the indictment alleges DMCA provisions were used for the appearance of legitimacy — the actual material was not removed, only some links to it were, takedowns agreement was approved based on business growth rather than infringement, and the parties themselves openly discussed their infringing activities. The indictment says that Megaupload executives:.
Prosecutors said in the indictment that Megaupload was not DMCA compliant, and cited the example of an alleged infringer on the site known as “VV. According to prosecutors, although numerous takedown e-mails had been sent, none of the files had been deleted. In a television interview with 3 News , Kim Dotcom said he was not a “piracy king”, and said that Megaupload had applied the provisions of the DMCA and went beyond it, by giving copyright holders direct rights to delete links.
He also said that the indictment relied on a malicious interpretation of technical issues to construe its claim of criminal intent, and that there was significant legal use of Megaupload. Kim Dotcom denied the charges filed against him and retained the services of Ira P.
Rothken , an attorney who has defended several copyright infringement cases. Ira Rothken stated that there is no criminal liability for secondary copyright infringement under US law, quoting a similar case involving YouTube as an example of similar accusations which were dealt with as a civil case. Dotcom initially hired Washington, D.
The law firm Quinn Emanuel , retained by Megaupload to argue for the retention of Megaupload’s data, said in a motion filed to the court that there was a concerted effort by the United States Department of Justice to deny Megaupload fair legal representation. In the brief, Quinn Emanuel alleged that several law firms dropped out of the case after the DoJ informed them of potential conflicts of interest, arguing that they wanted to call clients of the firms as witnesses.
Given the size of the Megaupload, Quinn Emanuel said this “conflict of interest” argument could be applied to any law firm with experience in intellectual property rights, denying Megaupload experienced representation in a case where both law and technical issues are involved. Quinn Emanuel received such a letter but rejected the DoJ’s arguments.
He pointed out that criminal copyright infringement requires that willful infringement has taken place, and that taking Megaupload offline had produced the “deeply unconstitutional effect” of denying legitimate users access to their data. The defence has drawn on procedural errors by the prosecution to challenge the case and in a judgement at the end of May , New Zealand judge David Harvey granted the defendants the right to the disclosure of evidence held by the FBI in preparation for the extradition trial.
He also confirmed that the charges in the indictment relating to money laundering, racketeering and wire fraud are not separate criminal acts but are dependent on the claim of criminal secondary copyright infringement. Following the seizure of Megaupload, concerns were raised as to what would happen to the files that had been uploaded by its users.
Attorney Neil H. MacBride wrote:. The Mega Servers are not in the actual or constructive custody or control of the United States, but remain at the premises controlled by, and currently under the control of, Carpathia and Cogent. Should the defendants wish to obtain independent access to the Mega Servers, or coordinate third-party access to data housed on Mega Servers, the issue must be resolved directly with Cogent or Carpathia.
In response, on 30 January , Carpathia Hosting denied having access to MegaUpload files and issued a press release stating. Carpathia Hosting does not have, and has never had, access to the content on MegaUpload servers and has no mechanism for returning any content residing on such servers to MegaUpload’s customers. The reference to the 2 February date in the Department of Justice letter for the deletion of content is not based on any information provided by Carpathia to the U.
We would recommend that anyone who believes that they have content on MegaUpload servers contact MegaUpload. Please do not contact Carpathia Hosting. The Electronic Frontier Foundation has started a campaign to allow legitimate users of Megaupload in the US access to their data and wants the data preserved for that reason. It has chosen to represent one such legitimate user in court and thus has sided with Megaupload and Carpathia in asking the court to retain the data.
On 26 April , Megaupload data negotiations began. United States district court Judge Liam O’Grady ordered all parties to return to the negotiating table. The U. LeaseWeb wiped all of Megaupload’s data. Following the shutdown of the Megaupload website, the website of the United States Department of Justice and other websites were taken offline following concerted denial of service attacks attributed to Anonymous. Gizmodo concurred that it was “almost certainly the result of a quickly assembled DDoS [Distributed Denial of Service] attack—and easily the widest in scope and ferocity we’ve seen in some time”, commenting that “if you had any doubts Anonymous is still a hacker wrecking ball, doubt no more”.
On 19 January , Anonymous released a statement on Pastebin. On 31 May , a New Zealand court ordered police to return any items not relevant to the case and to provide copies of relevant material to Dotcom and his associates.
Former French president Nicolas Sarkozy said he was satisfied with the shutdown of the website. He found the site’s operators were reaping “criminal profits from the illegal distribution of copyrighted works”. Web organisations have raised concerns about possible effects of the Megaupload case on the future of file sharing , cloud storage , and Internet commerce. Dvorak , Glenn Greenwald , and Julian Sanchez have written on the topic as well, particularly as it relates US government powers to take down a web site without a trial, even without new laws like SOPA.
People who used Megaupload for personal and business storage, such as large audio and video files for family and work, have also voiced their complaints about the fact that they no longer had access to their files on the service.
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