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US court puts studio and labels’ MegaUpload lawsuits on hold, for now

By | Published on Friday 13 June 2014


An American court yesterday granted a request from MegaUpload founder Kim Dotcom to put two lawsuits being pursued against him on hold pending the ongoing criminal investigation into his former business. Though the current freeze on the litigation will only run to August, when the matter will be reconsidered.

As previously reported, in April the US film and music industries both launched civil action against Dotcom and his MegaUpload cohorts over allegations the former digital business enabled rampant copyright infringement prior to its forced shutdown in 2012.

But, of course, the US authorities are still pursuing a criminal case against Dotcom et al over the same allegations, so lawyers for the Mega team quickly requested that any civil lawsuits be postponed until after the criminal action was complete. Otherwise defendant testimonies in the former might be hindered over worries they’d affect the latter.

Neither of the trade bodies that represent the US movie and record companies, the Motion Picture Association Of America and the Recording Industry Association Of America respectively, had much of a problem with the postponement plan, but they wanted certain conditions included in any ‘motion to stay’, and in the main the judge, Liam O’Grady, has obliged.

Under the motion, the MPAA and RIAA are free to add extra defendants and otherwise modify their lawsuits while the matter is on hold. And most importantly, O’Grady said it was fine for the plaintiffs to try and stop moves in New Zealand and Hong Kong to return previously frozen MegaUpload assets to Dotcom and co. The studios and labels have expressed fears that if the former Mega management get their money back they could move it off-shore, so that if and when the content industries are rewarded damages, they’ll be no cash to pay them.

According to Torrentfreak, the judge remarked: “The court finds that each of the plaintiffs’ proposed conditions are reasonable under the circumstances of this case because of the possibility that defendants’ assets abroad may become unfrozen. Plaintiffs may institute and pursue any action in the United States or a foreign jurisdiction to preserve defendants’ assets in the event that such action becomes necessary”.

The MPAA and RIAA’s litigation is now on hold for seven weeks, until 1 Aug. Meanwhile the criminal case against Dotcom et al moves along at pretty much the same speed as those protesting taxi drivers in London the other day.