The Feds Win Few Friends With Their Megaupload Case

When last we dropped in on Megaupload founder, Kim Dotcom, at his home in New Zealand, he was reaping the rewards of the Justice Department's lack-of-charm offensive, as well as from a seemingly strong legal strategy and growing public sympathy. Since then, while there are certainly no guarantees that he'll prevail in a high-profile battle against the United States government, his position has, if anything, improved because of American ham-handedness and Kiwi outrage.

For starters, having shut down Megaupload and denied the company's users access to their stored data — much of it unrelated to the copyright concerns that initiated all the fuss — the feds are now telling Megaupload customers around the world that they'll have to foot the bill to have their information retrieved. Responding to a lawsuit brought by journalist Kyle Goodwin, who is represented by the Electronic Frontier Foundation, federal attorneys argue that, just because government efforts to build a case impose costs on third parties doesn't mean the government should be held liable for its actions. But they do more, as TechDirt points out, arguing that there's nothing the court can do, anyway, because the government is beyond reach. Specifically, in its brief, the government says:

No matter the merits of Mr. Goodwin's argument, any such claim that the government must make him whole is plainly barred in the Fourth Circuit. Congress has not expressly waived the United States' sovereign immunity against suits for money damages pursuant to Federal Rule of Criminal Procedure 41(g). Thus, the Court lacks jurisdiction to order the government to provide the funds to Mr. Goodwin to make him whole.

A quick Google News search reveals that particular go-to-Hell is reaping non-rewards in a multitude of languages.

If the federal government doesn't especially care about its PR foibles around the world, it might want to pay a little closer attention to relations with New Zealand officials, who actually have possession of Megaupload founder, Kim Dotcom. According to the New Zealand Herald:

FBI agents sent cloned copies of computers seized from Kim Dotcom and his Megaupload colleagues offshore just days after a judge said a court needed to decide if the agents were allowed to take the material, a court heard.

Dotcom's lawyer Willy Akel said the FBI agents committed an "illegal act" when they sent the 18 cloned computers and other items to the United States by the courier company Fedex. …

It's not completely clear yet, but it looks like the Yanks absconded with the evidence while their hosts were negotiating over the disposition of the stuff with the defense team, leaving egged faces all around.

By contrast, Judge David Harvey described Kim Dotcom as "upfront and transparent" and eased his bail restrictions. That's important, because the same judge is presiding over Dotcom's extradition hearing, and will decide whether the people who ignored his order about evidence have brought a sufficiently strong case to warrant shipping the "upfront and transparent" guy overseas to face trial — and the strength of the case isn't certain.