Megaupload loses its top lawyer over conflict of interest

WASHINGTON (Reuters) - Content-sharing Internet service Megaupload.com has lost the help of one of the best-known U.S. defense lawyers as it begins to fight charges of copyright infringement, a person familiar with the matter said.

Robert Bennett was required to withdraw from the case because of a conflict involving at least one other client of his law firm, Hogan Lovells, this person told Reuters. The other client or clients were not identified.

Bennett initially advised Megaupload.com. The company and seven of its executives were charged in a 5-count, 72-page indictment unsealed on Thursday accusing them of engaging in a wide-ranging and lucrative scheme to offer material online without compensating the copyright holders.

Bennett's long career includes past representation of President Bill Clinton. He was Clinton's personal attorney in a sexual-harassment case brought by Paula Jones. He has represented a wide array of other prominent Washington officials and U.S. corporations, including former energy giant Enron Corp.

Under the ethics rules for U.S. lawyers, a firm generally does not represent two clients whose interests are at odds. Conflicts are especially likely to arise at law firms as large as Hogan Lovells, one of the biggest in the world, because of the number and variety of clients they represent.

Bennett was working for Megaupload before the website's executives were indicted, said Ira Rothken, one of Megaupload's lawyers. Rothken said Bennett was handling matters other then criminal defense.

After the U.S. Justice Department announced the indictments, Bennett provided initial guidance to the company, Rothken said. Rothken said he was not yet prepared to comment on the makeup of the U.S. legal team.

"Who is or isn't on the criminal defense team is still being decided," Rothken said.

U.S. investigators allege that Megaupload made more than $175 million by distributing copyrighted content without the required authorization.

The company has promised a vigorous legal defense, responding to the indictments by saying it offered only online storage.

(Additional reporting by Jeremy Pelofsky; Editing by Howard Goller)

Source: Reuters US Online Report Internet News

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