U.S. and MPAA Protest Return of Megaupload’s Servers

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A possible release of Megaupload's servers, containing millions of files of former users as well as critical evidence for Kim Dotcom's defense, is still far away. Responding to questions from the federal court, the MPAA says that it's gravely concerned about the copyrighted works stored on there. The U.S. Government, meanwhile, doesn't want Megaupload to use 'illicit' money to retrieve any data.

megaupload-logoWhen Megaupload was raided early 2012 the U.S. Government seized 1,103 servers at Carpathia’s hosting facility in the United States.

Nearly four years have since passed and it’s still uncertain what will happen to the servers, which are safely stored in a Virginia warehouse at the moment.

After a renewed request for guidance on the issue, District Court Judge O’Grady started to explore what options are on the table. He asked the various parties what would be required to release the servers and whether their possible return has any complications.

In a response, hosting company QTS/Carpathia says that most data will still be intact but that retrieving it will be a costly endeavor.

The equipment that was used to link the servers together is no longer on the market. Used parts are still available but this would cost roughly $500,000. In addition, hundreds of thousands of dollars are needed to move the servers and set them up properly.

United States Attorney Dana Boente notes that a successful data return would likely cost millions. However, the Government has no interest in the servers and doesn’t want any of Megaupload’s restrained funds to be released to pay for the costs.

According to the Government some of Megaupload’s money comes from illicit proceeds. In addition, the possible return of the servers is a concern because they contain child pornography.

“The United States further reminds the Court that the Federal Bureau of Investigation found that many of these servers contain, as indicated more particularly under seal, copies of known images of child pornography,” Boente writes (pdf).

The MPAA also responded to questions posed by the court. The Hollywood group says it’s still gravely concerned that the copyrighted movies and TV-shows may fall into the hands of others.

“The MPAA members remain gravely concerned about the potential release of the copyrighted works that are stored on the […] servers at issue here,” the movie industry group writes (pdf).

Transferring the data to Megaupload or another party would be copyright infringement in and by itself, they argue.

“The release of these digital files would not only risk the further infringing distribution of the MPAA members’ highly valuable copyrighted works, but any transfer of these files by QTS to Megaupload or a third party would itself be an infringement of the MPAA members’ copyrights in those works.”

Based on the reasoning above it’s nearly impossible to move any of the data without violating the rights of the movie studios.

However, former Megaupload user Kyle Goodwin, represented by the EFF, stresses that there’s no need to restore the entire infrastructure. He only wants access to the personal files he lost during the raid.

Finally, Megaupload’s defense argues that it can’t pay for the servers as long as their assets are restrained.

Dotcom’s defunct file-hosting service suggests placing the servers “under a litigation hold” at a reputable eDiscovery vendor such as KPMG, to ensure the confidentiality of the files. Recovering the data won’t come cheap though.

“Megaupload had previously received an e-vendor’s estimate of US$7.7 million for forensic duplication of the data needed for e-discovery and evidence purposes,” they write (pdf).

It’s now up to District Court Judge Liam O’Grady to make a recommendation regarding the possible return of Megaupload’s servers. Based on the input from the parties above this may prove to be a difficult task.


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