U.S. authorities overreacted in shutting down the online file-sharing site Megaupload and seeking criminal charges against its executives, the company's American lawyer said Friday.

"We believe that the allegations are without merit and Megaupload is going to vigorously defend against the case," attorney Ira Rothken said.

Federal authorities shut the site down Thursday, the same day they announced indictments against seven people connected to the site, accusing them of operating an "international organized criminal enterprise responsible for massive worldwide online piracy of copyrighted works." Four of those charged were arrested Friday in New Zealand at the request of U.S. authorities.

The site, which traffic-tracking service Alexa ranked as the world's 72nd most visited website before it was taken down, allowed users to share and download files, many of which were copyrighted works made available for download without permission, according to authorities.

Rothken said the case demonstrates a "copyright extremist mentality" on the part of U.S. authorities and raises significant due process and consumer protection issues.

He said it was inappropriate for U.S. authorities to seize the company's servers and domain names, not to mention $50 million in assets, without a court hearing.

He also said the seizure means consumers who had stored legitimately acquired materials on sites owned by Megaupload can no longer access them.

The seizure "has essentially created a chilling effect on consumers using Internet cloud storage going forward," Rothken said.

Federal prosecutors allege Megaupload's founders "conducted their illegal operation using a business model expressly designed to promote uploading of the most popular copyrighted works."

The site's popular MegaVideo subsidiary was widely known in tech circles for its copious selection of pirated content, including recent movies and episodes of hit TV shows.

"The conspirators allegedly paid users whom they specifically knew uploaded infringing content and publicized their links to users throughout the world," prosecutors said in a statement. They also took steps to mask the presence of illegal content on the site, prosecutors said.

The company also discouraged users from using the site for legitimate personal storage by automatically deleting files that weren't regularly downloaded, prosecutors said.

Authorities said the operation had generated more than $175 million in illegal profits through advertising revenue and the sale of premium memberships.

Those indicted are citizens of New Zealand, Germany, Slovakia and the Netherlands. No U.S. citizens were named. However, Megaupload has servers in Ashburn, Virginia, and Washington, which prompted the Virginia-based investigation.

The investigation involved 20 search warrants in eight countries, authorities said. Officials seized 18 domain names from the company and its servers based in the United States, the Netherlands and Canada.

Megaupload's sudden shutdown Thursday got the attention of hackers, who quickly assembled a widespread operation to take down the Justice Department and FBI websites, as well as those for the Motion Picture Association of America, the Recording Industry Association of America and several other sites.

The Internet activism and hacking collective Anonymous took credit for the denial-of-service attacks, which don't damage computer systems but keep sites from operating properly by overloading them with spurious requests. That can slow a site down or keep its servers from responding to legitimate requests.

"It's a violation of freedom of speech," one Anonymous member told CNN of the Megaupload shutdown. "It's part of a bigger picture that's taking place ... which is a very big slide toward Internet censorship on a gigantic scale."

Most of the sites were back up by Friday morning, but the website for New Zealand police, which Anonymous also targeted, appeared to be down early Saturday.

The Justice Department and FBI sites targeted Thursday were operating normally on Friday, a law enforcement official told CNN. Investigators are "looking at forensics to see where (the attack) came from," the official said.