Ortmann and Others v United States of America and Another

• Jurisdiction: New Zealand
• Judge: Kós P,French,Miller JJ
• Judgment Date: 05 July 2018
• Neutral Citation: [2018] NZCA 233
• Docket Number: CA302/2015 CA128/2017 CA493/2017 CA494/2017 CA495/2017 CA511/2017
• Court: Court of Appeal
• Date: 05 July 2018

Between

Mathias Ortmann

First Appellant

Bram Van Der Kolk

Second Appellant

Finn Habib Batato

Third Appellant

Kim Dotcom

Fourth Appellant

and

United States of America

First Respondent

District Court at North Shore

Second Respondent

[2018] NZCA 233

Court:

Kós P, French and Miller JJ

CA302/2015

CA127/2017

CA128/2017

CA493/2017

CA494/2017

CA495/2017

CA511/2017

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

Civil Procedure — appeal against a High Court (“HC”) decision which upheld a District Court (“DC”) finding that the appellants were eligible for extradition — appellants operated a business known as Megaupload which allowed users to upload and share files of copyright material — whether double criminality is required in extradition between New Zealand and the United States — whether copyright infringement by disseminating infringing copies online could found an extradition offence under s24(2)(c) Extradition Act 1999 (“EA”) (determination of eligibility for surrender — how eligibility was determined under the record of case procedure in the EA

Counsel:

G M Illingworth QC, A K Hyde and PJK Spring for Messrs Ortmann and van der Kolk

S S Masoud-Ansari for Mr Batato

R M Mansfield and S L Cogan for Mr Dotcom

K Raftery QC, M J Ruffin, FRJ Sinclair and Z A Fuhr for the United States of America

No appearance for District Court at North Shore

• A Mr Dotcom's, and Messrs Ortmann and van der Kolk's, applications for leave to adduce further evidence on appeal are declined.

• B Leave to file the submissions referred to in the memorandum of Mr Illingworth QC dated 24 April 2018 is declined.

• C The questions of law on which Gilbert J granted leave are answered as follows:

  • (a) Question 1: Was the High Court Judge correct to find that the essential conduct with which the appellants are charged in each count constitutes an extradition offence for the purposes of s 24(2)(c) of the Extradition Act 1999?

    Answer: Yes, though for somewhat different reasons.

  • (b) Question 2: Was the High Court Judge correct to conclude that copyright in a particular work does not form part of the accused person's conduct constituting the extradition offences correlating to counts 4 to 8; and to conclude that proof of this is not required for the purposes of s 24(2)(d) of the Extradition Act 1999?

    Answer: Yes. Copyright in a particular work was not part of the appellants' conduct constituting the extradition offences alleged in counts 4–8 of the superseding indictment and it need not be proved for the purposes of s 24(2)(d) of the Extradition Act. Rather, it is a circumstance transposed when determining whether the offence is an extradition offence.

• D The remaining applications for leave to appeal on the questions of law raised by the appellants are declined.

• E The application for leave to appeal on the questions of law raised by the United States is declined.

• F The eligibility determination made by the District Court is confirmed. The District Court should now proceed without further delay to complete its duties under s 26 of the Extradition Act in accordance with the determination.

• G The appeal against Gilbert J's decision to decline judicial review is dismissed.

• H The appeal in CA302/2015 is dismissed.

• I The parties are granted leave to file memoranda of no more than two pages in length, excluding the cover page, in relation to costs within 10 working days of the delivery of this judgment. The appellants are encouraged to file a joint memorandum.

JUDGMENT OF THE COURT

REASONS OF THE COURT

TABLE OF CONTENTS

A INTRODUCTION	[1]
The Megaupload business model	[6]
B THE ALLEGATIONS	[6]
The United States charges	[18]
Illustrations from the ROC	[22]
C OUR APPROACH TO THE APPEALS	[23]
D THE EXTRADITION ACT	[26]
The statutory scheme	[26]
Interpretation principles	[59]
The Extradition Act's legislative antecedents	[60]
The New Zealand – United States Treaty	[67]
Extradition in practice under the 1965 Act and the Treaty	[72]
Parliamentary history of the Extradition Act	[78]
E DOUBLE CRIMINALITY IN EXTRADITION BETWEEN NEW ZEALAND AND THE UNITED STATES	[82]
Cullinane	[82]
Interpretation	[84]
Simplicity of extradition process	[86]
The Treaty's enumerative approach and double criminality	[89]
The Treaty language and double criminality	[90]
Reciprocity of New Zealand – United States extradition practice	[94]
The position in other jurisdictions	[96]
Conclusion: double criminality is required under the Extradition Act and the Treaty	[104]
F DETERMINING ELIGIBILITY UNDER THE ROC PROCEDURE	[105]
The Supreme Court decision in Dotcom	[106]
A meaningful judicial process	[107]
The Canadian cases on the ROC procedure	[110]
The New Zealand committal process	[115]
Transposition	[124]
G ARE THE ALLEGED OFFENCES “EXTRADITION OFFENCES”?	[133]
Analytical approach	[133]
Copyright	[135]
Judgment below	[138]
Submissions	[141]
Analysis	[143]
Limitation	[157]
Conspiracy	[163]
Count 2	[170]
The essential conduct	[170]
First pathway — Crimes Act, s 249	[173]
Second pathway — Crimes Act, s 228	[182]
Third pathway — Copyright Act, s 131	[186]
The Treaty	[190]
Conclusion	[195]
Counts 4–8	[196]
Count 3	[202]
The essential conduct	[202]
Pathways available	[204]
The Treaty	[209]
Conclusion	[211]
Counts 9–13	[212]
The essential conduct	[212]
First pathway — Crimes Act, s 249	[215]
Second pathway — Crimes Act, s 228	[219]
Third pathway — Crimes Act, s 240	[221]
The Treaty	[224]
Conclusion	[225]
Count 1	[226]
The essential conduct	[226]
Pathways available	[227]
The Treaty	[230]
Conclusion	[231]
Conclusion: the offences are “extradition offences”	[232]
H APPLICATIONS FOR SPECIAL LEAVE TO APPEAL	[233]
I ADMISSIBILITY AND SUFFICIENCY OF THE ROC	[237]
Was the ROC admissible?	[239]
Alleged non-compliance with s 25(3): admissibility	[240]
Alleged non-compliance with s 25(2): prescribed content	[244]
Reliability and duty of candour	[254]
Sufficiency of the evidence for committal	[257]
Submissions	[257]
Analysis	[260]
Application for leave to adduce further evidence	[263]
Conclusion on sufficiency	[265]
J THE STAY APPLICATIONS	[269]
The funding stay application	[270]
The circumstances	[271]
Application for leave to appeal	[278]
Analysis	[279]
The misconduct stay applications	[286]
The circumstances	[288]
Application for leave to appeal	[292]
Analysis	[293]
K JUDICIAL REVIEW	[304]
L SUMARY AND DISPOSITION	[322]
Summary of conclusions	[322]
Disposition	[328]

A INTRODUCTION

1 The United States wishes to extradite the four appellants to face trial for criminal infringement of copyright in that country. Through a business known as Megaupload they are said to have breached, on a massive scale, copyright in commercially valuable property such as movies, games and music.

2 In 2015 the United States secured in the North Shore District Court a finding that the appellants are eligible for extradition. 1 That Court has completed its inquiry but has yet to report to the Minister of Justice, whose decision it ultimately is to surrender them. The District Court also dismissed applications for a stay of proceedings, which had been brought on the ground that the United States had deprived the appellants of the capacity to fund their defence and otherwise abused the extradition process.

3 The appellants brought a wide-ranging appeal against the District Court decision on questions of law. They also sought judicial review. They failed before Gilbert J. 2 They now bring this second appeal on two questions of law, by leave of the Judge. 3 They also seek special leave to appeal a large number of additional

questions of law, 4 and they appeal the refusal of judicial review. 5 The United States also seeks special leave to appeal. 6 For completeness we record CA302/2015 is an appeal filed by Messrs Ortmann, van der Kolk, Dotcom and Batato against a judicial review decision of Katz J issued on 1 May 2015. 7 Before us the parties did not pursue this appeal and we are satisfied the concerns are similar to those in the other appeals and applications. We therefore dismiss that appeal

4 The two questions of law on which Gilbert J granted leave are: 8

• (a) Was the High Court Judge correct to find that the essential conduct with which the appellants are charged in each count constitutes an extradition offence for the purposes of s 24(2)(c) of the Extradition Act 1999?

• (b) Was the High Court Judge correct to conclude that copyright in a particular work does not form part of the accused person's conduct constituting the extradition offences correlating to counts 4 to 8; and to conclude that proof of this is not required for the purposes of s 24(2)(d) of the Extradition Act 1999?

5 These questions raise some issues of general importance: whether double criminality is required in extradition between New Zealand and the United States, whether copyright infringement by disseminating infringing copies online can found an extradition offence, and how eligibility is determined under the record of case procedure in the Extradition Act 1999 ( Extradition Act or 1999 Act).

B THE ALLEGATIONS

The Megaupload business model

6 We here explain, by reference to the record of case (ROC), how Megaupload is said to have worked. Except where...