Canadian Court Refuses to Ship Megaupload Servers to the US

A Canadian court has rejected a request from the United States to hand over 32 servers hosted by a local provider. Instead of simply handing over all data, which may include personal files of users, the court decided to first determine what files are stored on the machines. Megaupload lawyer Ira Rothken is pleased with the ruling and hopes the United States will be more considerate of the privacy of cloud hosting users when requesting data seizures in the future.

When Megaupload was raided last year the U.S. Government seized 1,103 servers at Carpathia’s hosting facility in the United States.

However, that was not the only hardware used by the file-hosting site. Megaupload also had machines elsewhere including 32 servers at an Equinix datacenter in Canada.

Suspecting that these machines may hold crucial data for the ongoing lawsuit, the U.S. Government asked Canada to hand them over for investigation.

In their request to the court the authorities back up their claim by citing an email from Megaupload staff, stating that the Canadian servers “will serve as a database / number crunching machines.”

Megaupload protested this broad request arguing that the servers may contain a lot of information that’s simply irrelevant to the case. The company asked the court to either deny the request, or appoint an “independent forensic examiner” who can inform the court what kind of files are stored on the 32 servers.

The Ontario court agreed with this reservation, and refused to send the servers to the United States before the contents are confirmed.

“The appropriate balance of the state interest in gathering evidence and privacy interests in information can be struck by an order that the servers be brought before the court [...] so that the court can make an order refining what is to be sent,” the order reads.

This likely means that an expert will be instructed to look at the Equinix servers to see whether the United States has any interest in the data. Until then, the servers will remain where they are.

Megaupload lawyer Ira Rothken is pleased with the ruling which he says protects the interests of users.

“We are pleased that the Canadian Court has issued a ruling designed to protect the privacy rights of Megaupload users,” Rothken told TorrentFreak.

“We hope the United States going forward will take into consideration the privacy rights of cloud storage users before attempting to search and seize servers globally in criminal investigations.”

According to Rothken the public should be very careful as to what information they store on cloud hosting services. He adds that people should use encryption to make sure that their personal files don’t fall into the wrong hands.

“The Government’s aggressive conduct here makes it clear that cloud storage users should strongly consider encrypting what they store in the cloud to use technology as the ultimate guardian of privacy rights,” Rothken adds.

While the old Megaupload didn’t offer built-in encryption, it is no coincidence that the new Mega will.

Kim Dotcom previously told TorrentFreak that he hopes to turn encryption into a mass product with the new Mega, which is scheduled to launch in a few days.

“Our easy to use one-click privacy feature will turn encryption into a mass product. We believe within five years half of all Internet traffic will be encrypted with solutions born from our new API,” Dotcom said last month.

Meanwhile, the legal battles will continue.