Megaupload Files Brief with Federal Court Requesting Data Preservation While Protecting User Rights Under the Stored Communications Act

Megaupload filed their response brief to the MPAA and RIAA studios' motion for preservation order on March 23rd, 2017 in Federal Court in the Eastern District of Virginia. Megaupload agrees that the cloud server data should be preserved and repaired as needed. Megaupload disagreed with the studios on certain proposed language in the draft preservation order that would act to preclude Megaupload from protecting the rights of its users under the Stored Communications Act (SCA) and accessing the data as needed to defend itself and others in the pending court cases. Here is a summary of Megaupload's submissions below.

You can read the full brief here.

RESPONSE OF DEFENDANT MEGAUPLOAD LTD.

TO PLAINTIFFS’ MOTION FOR ENTRY OF PRESERVATION ORDER

Defendant Megaupload Limited (“Megaupload”) hereby responds to Plaintiffs’ Motion for Entry of Preservation Order (Dkt. Nos. 61-64). Megaupload agrees that the Court should enter a preservation order in this action and a related private copyright infringement action1 specifying the agreed upon protocol to retrieve, restore, and preserve the cached data on servers that non-party Cogent Communications, Inc. had leased to Megaupload (“Cogent Servers”). Thus, Megaupload agrees to certain paragraphs of the proposed preservation order submitted by Plaintiff (Dkt. No. 61-1). As explained below, however, paragraphs 5 and 8 of the proposed order should not be adopted by the Court. Although written to sound neutral, paragraphs 5 and 8 tread on Megaupload’s rights and impair its ability to access and use that digital evidence in defense of the civil and criminal cases—essentially they enjoin Megaupload from access to this data without any extraordinary showing having been made. Instead, those paragraphs should be edited, and a new paragraph 9 governing Megaupload’s access should be added. A proposed form of order is submitted herewith.

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The Servers and the Data: The primary servers allegedly used by Megaupload in the United States are the so-called “Carpathia Servers” and the Cogent Servers (which together the government calls the “Mega Servers”). In January 2012, the Government executed search warrants as to Defendants at numerous locations around the world, including at Carpathia’s server-hosting facility in Virginia and at Cogent’s facility in the District of Columbia.3 On January 27, 2012, the Government informed Megaupload that it had “copied selected Mega Servers and copied selected data from some of the other Mega Servers,” without identifying the specific servers, the specific data, or the selection criteria. (Criminal Action, Dkt. No. 32, AUSA Prabhu Letter (Jan. 27, 2012).) At that time, the Government expressly disclaimed any “custody or control” over the Carpathia and Cogent servers:

"The Mega Servers are not in the actual or constructive custody or control of the United States, but remain at the premises controlled by, and currently under the control of, Carpathia and Cogent. Should the defendants wish to obtain independent access to the Mega Servers, or coordinate third-party access to data housed on Mega Servers, that issue must be resolved directly with Cogent or Carpathia.” (Id.).

Yet, thereafter, Megaupload’s access to the data on those servers has been anything but an issue that Megaupload could resolve “directly with Cogent or Carpathia.”

Importantly, Carpathia confirmed that it owns only the servers, but has no interest in the data: “Carpathia does not own and cannot access the data, nor does it have any interest in the data stored on” its servers; rather “its interests are solely in the physical hardware itself.” (Criminal Action, Dkt. No. 39 at 2.) Similarly, Cogent claims no interest in the cached data, only the servers on which the data are stored. As the Internet service provider (“ISP”), however, Megaupload has a statutory interest in the data (and its users have ownership and privacy interests in the data that has been stored).4 Similarly, as a defendant in pending civil and criminal cases, it has an interest in accessing this digital evidence to disprove the claims and charges. Yet, Megaupload has not yet had a clear path to the data on either set of servers.5

When Megaupload tried to acquire the Carpathia Servers so as to gain access to the data, the Government objected to block the sale. (Criminal Action, Dkt. No. 39 at 3.) And the government continues to object to Megaupload’s acquisition of those servers and access to thedata thereon. (Criminal Action, Dkt. No. 223 at 4-5 & n.3.) While again disclaiming any “custody or control” over the Cogent Servers, the government also has objected to Megaupload’s access to the data cached on the Cogent Servers—baldly asserting that it contains “contraband” that cannot be turned over to counsel for Megaupload. (AUSA Prabhu’s Letter to Magistrate Judge Anderson, June 23, 2016.)6

Accordingly, despite claiming that ownership of and access to the data is a private matter between Megaupload, Carpathia, and Cogent, all three have been handcuffed by the government’s objections—the servers and data supposedly are not “in custody,” but neither are they “free to go.”7

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ARGUMENT

Neither the government nor any party in the civil cases has filed a motion to enjoin Megaupload or preclude Megaload’s access to this data. Obviously, to obtain such extraordinary relief, the movant would have to make a substantial and detailed showing. None has been made. Yet, the government, merely by making bald assertions, and the Plaintiffs, through drafting legerdemain in the proposed preservation order, seek to bar Megaupload’s access to its own data. That is grossly unfair.

To be sure, Megaupload agrees that a preservation order is warranted. In extraordinary circumstances, like those now present, and prior to active discovery in a civil case, the Court has “inherent authority” to issue a “preservation order” that specific procedures be adopted to preserve specific evidence....

Read the Full Brief Here