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Megaupload Renews Call|to Dismiss Indictment

(CN) - Megaupload renewed objections to the criminal charges it faces, days after a federal judge unsealed 152 partially redacted pages of documents related to the government's case.

The file-sharing website says U.S. District Judge Liam O'Grady should dismiss the indictment without prejudice until it can try to extradite a corporate officer and serve that individual in the district.

O'Grady had described this scenario somewhat when he denied Megaupload's first motion to dismiss last month.

Megaupload filed its renewed request for dismissal on Monday.

The six-page motion describes statements that its attorney William Burck, with Quinn Emanuel, Urquhart & Sullivan, made at a July 27, 2012, hearing.

"THE COURT: Well, that - can I require [the government] to serve the company on any particular date? There's no date in the rule - there appears to be no statutory limitation, and I understand your due process argument. So I - what if I, you know, would start with a premise that I don't control when the Government decides to serve the company. Where do we go from there?

"MR. BURCK: Well, Your Honor, we would submit that if the Court were ruling - going in that direction as a reasoning matter, that the appropriate result would be to dismiss the indictment without prejudice. ...

"A year down the road, two years, however long it takes and wherever the MLAT [Mutual Legal Assistance Treaty] process or the extradition process takes, at that point we could have this argument as to specific individuals, corporations, entities. But, in the meantime, having the company subject to the burden of a - the incredible burden of a criminal prosecution with no ability to defend itself and no service is an extraordinary result and one that is unprecedented," Burke argued in July, as quoted in the motion.

Days before Megaupload filed the new motion, O'Grady unsealed 152 pages of documents related to the U.S. government's warrant to shut down Megaupload.com.

The production comes in connection to the motion filed by small-business owner Kyle Goodwin, represented by the Electronic Frontier Foundation.

These documents have remained sealed since the U.S. seized the file-sharing site's domain names in January 2012, following the indictment and arrests of the company's corporate officers and founder Kim Dotcom.

In a March 2012 complaint, Goodwin said he used Megaupload to back up videos for his website OhioSportsNet.tv, and that now he cannot recover his data from the downed Megaupload servers.

"Access to the government's warrant application and related materials can help us ... provide assistance in our efforts to get Mr. Goodwin his property back," Electronic Frontier staff attorney Julie Samuels said in a statement after filing the motion to unseal.

A Megaupload attorney, Ira Rothken, told CNET that the unsealed documents show how prosecutors misled the judge when applying for a warrant. Prosecutors allegedly indicated that the government sent Megaupload a criminal search warrant in 2010 regarding a number of copyrighted video files on its servers.

"In our view that's a misleading statement," Rothken told CNET. "Megaupload was served with a criminal search warrant for alleged third-party user conduct and was advised not to interfere with that criminal investigation or with the files - as such disclosure, would jeopardize the ongoing investigation. To ask Megaupload to cooperate and then use that cooperation against them, to us seems to be both unfair and misleading."

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