Megaupload founder Kim Dotcom cried foul last week when a new promotional music video for the file-sharing service was removed from YouTube by Universal Music Group on copyright grounds. This wouldn't be news if the video did indeed infringe on any part of Universal's copyright, except it didn't. While the music video features many mainstream artists, including P Diddy, Will.i.am, Alicia Keys, Kanye West, Snoop Dogg, Chris Brown, The Game and Mary J. Blige, it doesn't contain any copyrighted music. These artists were hired by Megaupload to literally sing the praises of the file-sharing service, and the song was composed by producer Printz Board. In other words, unless Universal has signed contracts prohibiting any of these artists from appearing in a video without its consent, the music label has absolutely no rights to material on any part of Megaupload's video. Mr. Kim told TorrentFreak that UMG is "sending illegitimate takedown notices for content they don’t own," calling it “dirty tricks in an effort to stop our massively successful viral campaign.” Calling UMG a rogue label, Mr. Kim initially only requested an apology and for YouTube to reinstate the video; after his efforts were proven futile, he filed suit against the music company. What follows is amazing at least to say. Universal, in defending of itself, claims that its action was perfectly legal, as it did not file any false takedown notices under the Digital Millennium Copyright Act, commonly known as the DMCA. Instead, it says that YouTube has granted it rights to remove videos on the website, even those that are not infringing on any of its copyrights. Here's what it says in a letter UMG lawyer Kelly Klaus sent to YouTube, after the video-sharing website requested more documentation to support the copyright claim:

Your letter could be read to suggest that UMG's rights to use the YouTube "Content Management System" with respect to certain user-posted videos are limited to instances in which UMG asserts a claim that a user-posted video contains material that infringes a UMG copyright. As you know, UMG's rights in this regard are not limited to copyright infringement, as set forth more completely in the March 31, 2009 Video License Agreement for UGC Video Service Providers, including without limitation Paragraphs 1(b) and 1(g) thereof.

Let me make this very clear: UMG says it has the right to take down videos on YouTube, even the ones that don't infringe any of its copyright. And it did. This is what copyright holders can do, given the power. Now consider the SOPA bill, which will grant them more power to do things like wipe websites off the Internet, hurt website operators financially, and potentially kill job-creating startups and innovation in the process. Can you say for sure that such power wouldn't be abused? Update: TechDirt had received a response from YouTube on the matter. It appears that UMG has no rights to take down any videos it dislikes on YouTube, but only live performances with its artists in it, provided it has prior agreement with its artists.

Our partners do not have broad take-down rights to remove anything they don’t like from our service. In limited cases, if they so choose, and based on exclusive agreements with their artists, partners can take down live performances.

Here's the video in question, which was finally reinstated, but only after UMG was sued (not the best music around though, to be very honest): [youtube http://www.youtube.com/watch?v=K9caPFPQUNs?rel=0]