They aren't using the DMCA against him. Where DMCA comes into the picture is that for hosting sites DMCA compliance can be used as a defense against a charge of copyright infringement in the US.
The underlying problem for Megaupload is that what they were doing is illegal in over 180 countries (basically any country that is a party to a major international copyright treaty or convention).
A good general rule of thumb is that if you want to host something that is illegal in country X hosting it in country Y without an extradition treaty is not sufficient. You should pick a Y where it is not illegal there. Otherwise even if Y does not care enough to go after you, if Y has good trade or other relations with X the may respond positively to encouragement from X to go after you.
The underlying problem for Megaupload is that what they were doing is illegal in over 180 countries (basically any country that is a party to a major international copyright treaty or convention).
A good general rule of thumb is that if you want to host something that is illegal in country X hosting it in country Y without an extradition treaty is not sufficient. You should pick a Y where it is not illegal there. Otherwise even if Y does not care enough to go after you, if Y has good trade or other relations with X the may respond positively to encouragement from X to go after you.