Movie Studios Want to Copy Megaupload’s Servers

Well over four years have passed since Megaupload was shutdown, but aside from Andrus Nomm’s plea deal there has been little progress in U.S. proceedings.

Last December a New Zealand District Court judge ruled that Kim Dotcom and his colleagues can be extradited to the United States to face criminal charges.

This decision was quickly appealed by the defense and will be heard in August, so until then not much is expected to happen.

But there’s more legal trouble for the defunct file-hosting service. In addition to the criminal case, Megaupload and Kim Dotcom are also battling civil lawsuits against the major record labels and Hollywood’s top movie studios.

Fearing that they might influence criminal proceedings, Megaupload’s legal team previously managed to put these cases on hold, with permission from the copyright holders. However, when Megaupload’s counsel recently opted for another stay pending the extradition appeal, the movie studios objected.

In a new motion filed at a federal court in Virginia, Megaupload’s lawyers inform the court that the studios will only agree to the stay if they can get a copy of Megaupload’s data at Cogent Communications.

“Plaintiffs indicated they would not consent unless Defendants agreed to allow Plaintiffs to immediately serve a subpoena on a third-party, Cogent Communications, to obtain a mirrored copy of Megaupload’s users’ data cached on servers Megaupload had leased from Cogent,” they write (pdf).

Cogent was one of the companies where Megaupload stored its servers. While the original machines are no longer intact, the company has backed up all data which it will keep in storage pending the various lawsuits.

The Hollywood studios now argue that they “would prefer” to have a copy of the cached data as well, but this is something Megaupload has strong legal objections to.

“The cached data belongs to Megaupload’s users. Megaupload was an ISP to its users, who entrusted it with their data, and, by federal statute, Megaupload has certain legal obligations to its users, including confidentiality and privacy,” Megaupload’s legal team writes.

“As Megaupload explained to Plaintiffs in a lengthy meet-and-confer email, that there are numerous issues and legal risks implicated by Plaintiffs’ proposal to serve a subpoena on Cogent to obtain a mirrored copy of the cached user data,” they add.

Both sides discussed the matter in detail but were unable to come to an agreement they would feel comfortable with. Megaupload nonetheless, asks the court to freeze the case for another six-months.

If the court would find it appropriate that someone else other than Cogent gets access to the data, they believe that Megaupload would be the best suited party for this.

The movie studios are expected to submit their objection to the request and ask for a subpoena to copy Megaupload’s data at Cogent. A hearing on the renewed request for a stay is scheduled for later this month.

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