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Feds say MU subject to US laws


Feds say US ties make Megaupload subject to criminal law
Megaupload had servers and customers in the US, even filed a lawsuit here.

The United States government has told a Virginia judge that a long list of American connections makes Megaupload subject to US criminal law. The Friday court filing was a response to the company's argument that its lack of a US mailing address makes it immune to criminal prosecution in the United States.

Megaupload points to federal law requiring that notice of a corporate indictment be served on an officer of the corporation and sent to the corporation's last known US address. It has argued that since it doesn't have a US address, it cannot be indicted.

But Megaupload shouldn't be allowed to escape US jurisdiction on a technicality, the feds said in a Friday court filing. And while the locker site has never maintained an office in the US, it has extensive American connections.

Most obviously, the firm has hundreds of servers in the United States. It makes use of American financial services companies such as PayPal. It has numerous American customers.

And Megaupload has availed itself of the US legal system. Last year, the firm sued Universal Music Group in US courts for attempting to take down a Megaupload video from YouTube. And the site's terms of service stipulated that they would be "governed by and construed in accordance with the laws of the State of California."

"It appears that Defendant Megaupload, for its own convenience, would subject itself and its users to the jurisdiction of courts in the United States, even as the company now argues that it cannot be brought before a federal court to face criminal charges," the government writes.

And even if the company is not currently subject to US jurisdiction, the government argues, there's no time limit for serving papers on Megaupload. Therefore, it argues, the courts can put the case against Megaupload on hold until Kim Dotcom is extradited to the United States. Then, the government can personally serve papers on Dotcom as a representative of Megaupload.

Judge Liam O'Grady will consider Megaupload's arguments for dismissal, and the government's counter-argument, at a hearing in Alexandria, VA, on July 27.
by Timothy B. Lee
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