Most of us have moved to the cloud–we put our most precious data, photos, videos, files, in the cloud like it’s a bank where we put our money in.  But there’s a huge difference.  A bank, if it goes bankrupt, gets rob or hit by a series of unfortunate events, they would return their clients’ money. But in the case of cloud service providers, if the government shuts it down, there’s no way consumers would be able to get their data back.  And that really sucks especially if the data you moved to the cloud is your sole copy.

And that’s what pisses off Abraham David Sofaer, a former New York federal judge.  In a paper he recently presented to the National Academy of Sciences regarding fending off cyberattacks, he was not amused when he learned that the Hong Kong-based, celebrity endorsed file-sharing service, Megaupload, was shutdown by the government for harboring and distributing pirated contents, and refused to give the data back to their rightful owners.

“It’s really quite outrageous, frankly,” the 74-year-old President Jimmy Carter appointee said in a recent telephone interview. “I was thinking the government hadn’t learned to be discreet in its conduct in the digital world. This is a perfect example on how they are failing to apply traditional standards in the new context.”

Sofaer teamed up with the  Electronic Frontier Foundation (EFF), an international non-profit digital rights advocacy and legal organization based in the United States, who’s helping legitimate Megaupload users to get their files back.

“It’s clear that he really gets why this case matters and has the experience and perspective necessary to take the long view: If the court allows the government’s actions to go unchecked here,” said EFF attorney Julie Samuels, “we’ll be facing a world with inhibited property rights that is less friendly for innovation.”

Another thing that irks Sofaer is the fact that the government has the power to do this to other sites as well.  Since the shuttering of Megaupload, then the demise of other services after the incident, it was clear that cloud services aren’t safe from the claws of the government; that even if they do not have sufficient evidence of a crime or if innocent people are involved, they would just do what they want.

But will every cloud service fall prey to the government?  I think not.  I think the top dogs of the cloud service industry, such as Google and Dropbox, can come off clean.  You see, the two cyberlockers aren’t very different from Megaupload as they both offer services that would allow direct linking to infringing files–but they’re still active.  Either they’re that good or the government is just whacked, or they just pick their battles very well.

Government Vs Megaupload, Carpathia and Users

Kim Dotcom, the founder of Megaupload and a number of his employees were charged with engaging in a racketeering conspiracy, conspiring to commit copyright infringement, conspiring to commit money laundering, and two substantive counts of criminal copyright infringement.  Before the trial against them can begin, the New Zealand District Court is asking the US government to hand over all their evidences against the accused so they can properly defend themselves in court.  The US government refused to handover their evidences but New Zealand District Court Judge David Harvey stated that it would be unfair.

“In my view there must be fairness and the hearing and balance must be struck, otherwise the record of case becomes dominant virtually to the exclusion of everything else and places the extradition process in danger of becoming an administrative one rather than judicial,” the verdict reads.

The Motion Picture Association of America greatly supports the government’s move in shutting down Megaupload and other related domains as they want piracy to be stopped.  Though the group wanted all the files to be inaccessible to Megaupload users, they felt for the legitimate users and stated that they should be given their files back but copyrighted materials should be inaccessible in the process.

“The MPAA Members are sympathetic to legitimate users who may have relied on Megaupload to store their legitimately acquired or created data, although the Megaupload terms of use clearly disclaimed any guarantee of continued access to uploaded materials,” MPAA’s lawyers wrote.

“If the Court is willing to consider allowing access for users such as Mr. Goodwin to allow retrieval of files, it is essential that the mechanism include a procedure that ensures that any materials the users access and copy or download are not files that have been illegally uploaded to their accounts.

“In no event should any Megaupload defendants or their representatives who have not generally appeared in this proceeding, and who are not subject to the control and supervision of the Court be allowed to access the Mega Servers under such a mechanism designed for the benefit of third-party Megaupload users.”

Back in April, Carpathia Hosting, the hosting company that provided services for Megaupload, stated in a court filing that the government should pay for their services since they’re still holding users’ data.  The government stated that they are in no way responsible in paying their services since they’ve ordered the hosting company to delete the Megaupload files from their system.

To make matters worse, the government also stated that affected Megaupload users shouldn’t direct their anger to them but instead sue Megaupload or Carpathia for their lost files.

Carpathia suggested selling the Megaupload servers for $1,000,000 in order to keep the data but the government declined the offer stating that they did not want Megaupload funds unfrozen.

Kyle Goodwin, a Megaupload user that stored work-related files on the site, with the aid of the EFF, filed a motion demanding the court finds a workable solution so that his data, as well as the data of other Megaupload users will be returned.  He also accused the Government of violating the constitutional rights of many innocent Megaupload users through the overbroad seizures of domains and servers.

To which the government answered stating that, “The government does not possess any of Mr. Goodwin’s property, nor does it seek to forfeit it,” Attorney General Neil MacBride wrote.

“The government also does not oppose access by Kyle Goodwin to the 1103 servers previously leased by Megaupload. But access is not the issue – if it was, Mr. Goodwin could simply hire a forensic expert to retrieve what he claims is his property and reimburse Carpathia for its associated costs.”

As for Goodwin’s claims for monetary loss because of what happened, MacBride stated that he can sue Megaupload or Carpathia since they were the ones providing the service and the two should have had an insurance policy for situations such as this.