Megaupload, the company of accused internet pirate Kim Dotcom, has failed in a bid to have criminal charges of global copyright theft thrown out of a United States court.

Judge Liam O'Grady in the US District Court said in a ruling yesterday that the country had authority to bring copyright charges against Megaupload despite the company having no offices in the US.

In May, Megaupload's lawyers asked that the charges be thrown out because the company had no US address and could not be served with court papers. However, in his ruling, Judge O'Grady said: 'It is doubtful that Congress would stamp with approval a procedural rule permitting a foreign corporate defendant to intentionally violate the laws of this country, yet evade the jurisdiction of the United States' courts by purposefully failing to establish an address here."

Yesterday, Dotcom, who is facing extradition from New Zealand to the US over the case, questioned the judge's ruling that the company was intentionally avoiding the jurisdiction of the US and should be liable for trial in a country where it was not based.

'US judgement scary for non-US companies: By not establishing a US office you "purposefully" chose to evade US jurisdiction?' he said on Twitter.

Megaupload allowed users to store and share data online, but was shut down by a US-led operation in January that seized its assets and raided Dotcom's mansion in Auckland.

US prosecutors accuse Dotcom and seven others of generating more than $175 million in illegal proceeds from the sharing of pirated film, music and software files. They are seeking to extradite Dotcom to the US, where he could face up to 20 years in prison.

Judge O'Grady said that until the time the US Government was able to hand Megaupload the charging documents, the case could still be dismissed.

He left open the possibility that the company had been denied due process by the delay in serving the indictment and whether this was grounds for the case to be thrown out.

Megaupload's lawyers said the judge's comments were an indication of the US Government's disregard for criminal procedure in their case against Megaupload. "Judge O'Grady firmly rejected the government's argument that it is free to ignore the rules of criminal procedure in its case against Megaupload," lawyer William Burck said.

"Although he deferred a final decision on whether the case should be dismissed permanently until after the extradition process in New Zealand is completed, he made it clear he will consider dismissing the case now on a temporary basis."

If one of the company's executives was extradited, they may then be served with the indictment, the judge said.

In another Twitter comment yesterday, Dotcom said: 'It's a nightmare case for me & my family. But ultimately it will strengthen your rights & protect you better. My fight is your fight too." Fairfax NZ

- © Fairfax NZ News

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