By Charlotte Greenfield and Matt Siegel
WELLINGTON/SYDNEY (Reuters) - Nearly four years after dozens of black-clad police rappelled into his New Zealand mansion and cut him from a safe room, flamboyant German tech entrepreneur and would-be hip-hop star Kim Dotcom may finally be about to face the music.
A New Zealand court hearing starting on Monday will determine whether Dotcom will face charges of copyright infringement, racketeering and money laundering in the United States related to the Megaupload file-sharing site he founded in 2005.
Well known for his hip-hop inspired photo shoots with scantily clad women and luxury cars, Dotcom had assets including computers, art works, a pink Cadillac and bank accounts holding millions of dollars frozen after the 2012 raid in the hills outside Auckland.
U.S. authorities say Dotcom and three co-accused Megaupload executives cost film studios and record companies more than $500 million and generated more than $175 million by encouraging paying users to store and share copyrighted material, such as movies and TV shows.
"The U.S. ... took down the entire Megaupload site, went ahead and froze all their assets and did this with great publicity and public fanfare and did it in coordination with the very powerful force in the United States, from Hollywood," Dotcom's lawyer, Ira Rothken, told Reuters.
"We feel as though Kim Dotcom ... will not have a fair procedural playing field because he won’t have any assets with which to mount a defense for the largest copyright case in history."
Thumbing his nose at U.S. authorities, Dotcom set up a new cloud storage company call Mega after being bailed, but has since distanced himself from the business.
Monday's hearing will be watched by developers like Dotcom working in the grey areas of the law prevalent at the Internet's cutting edge for signs of how far Washington is willing to go to protect U.S. copyright holders, said Tom Pullar-Strecker, who covers technology for Fairfax Media in New Zealand
"You just have to look at what the U.S. has achieved already through this action. Kim Dotcom's business, Megaupload, has been destroyed really through simply taking the action," he said.
"It had an immediate chilling effect."
Megaupload accounted for about 4 percent of total traffic on the Internet in its heyday as users stored and shared files containing everything from wedding videos to Hollywood films.
Since his arrest, Dotcom, a German national and New Zealand resident, has been barred from leaving the country or venturing more than 80 km (50 miles) from his mansion, and is required to report to police twice a week.
The prosecution must prove that a crime was committed in both the United States and New Zealand in order to trigger an extradition treaty between the allies.
In an opinion submitted in support of Dotcom, Harvard law professor and copyright expert Lawrence Lessig argued that Washington's case does not meet those requirements.
"An attempt has been made to extract facts from multiple sources and over a wide span of time, to organize a large number of otherwise disconnected facts by using systematic phraseology and to juxtapose phrases in order to create an impression of coherence and substance," Lessig wrote.
"However, the attempt fails to reach its goals."
A spokeswoman for the New Zealand Crown Law service declined to comment.
(Editing by Lincoln Feast and Robert Birsel)