Kim Dotcom Will Be Baby Gift to Royals, Kiwi Prime Minister Quips

Kim Dotcom

"First the Prime Minister sold me to Hollywood," the Megaupload founder tweets in response. "I'll pick palace over prison."

SYDNEY -- While the FBI wants Megaupload founder Kim Dotcom extradited from New Zealand to the U.S. to face racketeering, money laundering and copyright theft charges, New Zealand prime minister John Key has come up with a unique way of getting him out of the country: gifting him to Britain's royals.

After being quizzed by journalists on Monday about what the government was considering giving Prince William and Kate Middleton as a gift for the upcoming birth of their baby, Key quipped: “We're giving them Kim Dotcom.”

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That’s just fine with the Internet entrepreneur. After hearing about Key’s comment, Dotcom tweeted: "First the Prime Minister sold me to Hollywood. Now he's gifting me to the royal family. I'll pick palace over prison."

The exchange took place just days after the pair was face to face for the first time at a parliamentary inquiry Key was chairing into law changes that would allow the Government Communications Security Bureau (GCSB) -- the country’s internal security agency -- to spy on New Zealanders under certain circumstances. Currently, that is not permitted.

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Dotcom has an interest in in the hearing, as the GCSB last year was found to have illegally spied on him ahead of his dramatic arrest on the above charges.

TV network TVNZ reported that after reading a prepared statement, Dotcom was asked whether Key knew the GCSB had spied on him before he was arrested in a raid, a point that has been politically contested for months. "Oh, he knew about me before the raid. I know about that," Dotcom replied.

Key told the hearing that wasn't true. Dotcom then said: "Why are you turning red, Prime Minister?"

"Why are you sweating?" Key responded. Dotcom said that it was hot and that he was wearing a scarf.

The Internet mogul argued that extended spying powers would erode the privacy of New Zealanders. "Spying powers not only erode the right to privacy and freedom of expression, it also has a negative impact on innovation, economic growth and business," he said. "There has never been a greater need for New Zealanders to once again step forward and declare that their values shall not be undervalued or suspended under pressure from the United States."

Pressed for a hint about New Zealand's actual baby gift to the British royals, Key on Monday would only say it was "special," refusing to provide specifics. Asked if it was a stuffed kiwi, he said, "It's a step up from a stuffed kiwi."