When the file-sharing site Megaupload was taken down by US authorities back in January, a lot users were dumbfounded.  The site and all their files were inaccessible.  Fortunately, Megaupload used hosting sites like Carpathia Hosting Inc. and Cogent Communications Group Inc. to keep their files alive, but this wasn’t accessible to users.

The worst part was, after the authorities were done with their investigation, the hosting sites were given the go ahead to delete all Megaupload’s files.  And because the hosting sites are no longer receiving compensation for keeping all that data, because Megaupload’s funds had been frozen, there was no point in retaining the files.

But not all Megaupload users were guilty of piracy and they want their data back.  So with the aid of the Electronic Frontier Foundation (EFF), an international non-profit digital rights advocacy and legal organization based in the United States, Carpathia stated that it will help in collecting stories of legitimate users who want to access their files in Megaupload and not delete the data.  But the question remains: Who will pay Carpathia for keeping the files?

Payment issue

In a hearing held last week, lawyer for Carpathia stated in court that the federal government should pay Carpathia as it continues to keep the Megaupload files.  But Jay Prabhu, the lawyer representing the U.S. Attorney’s office, stated that taxpayers’ money should not be used in order to keep the files safe.  Prabhu also argued that if Carpathia was still doing business with Megaupload and the price of transacting with the said company went up, they would not be asking taxpayers to shoulder the expense.

One could argue that Carpathia should just delete the Megaupload files and make their servers available to paying clients since they already have the blessing to delete the files but there are other things to consider like the legal files of some users, and other parties like the Motion Picture Association of America, EFF, and Megaupload lawyers.  These said parties are also pleading with U.S. District Judge Liam O’Grady that the government pay for Carpathia for their service.  O’Grady stated that he sympathized with Carpathia’s situation but that did not go well with Prabhu.

Prabhu unleashed

The judge sympathizing with Carpathia was the last straw for Prabhu.

Prabhu stated that Carpathia is in no way innocent of the whole Megaupload debacle as they were given subpoenas regarding the company’s alleged copyright violations from the government as well those from civil complaints filed against Megaupload before the raid and shutdown.  It was also stated that servicing Megaupload generated $35 million for Carpathia and that there’s a possibility the hosting company may face a civil complaint.

Unfortunately, even if Carpathia knew that Megaupload files were pirated or illegal, they are protected by the Digital Millennium Copyright Act’s (DMCA) Safe Harbor provision which states that they are not liable for any copyright infringement made by their clients.