Megaupload lost a bid on Friday to see a trove of evidence held by U.S. prosecutors prior to extradition proceedings expected to begin later this year in New Zealand.
The country's Court of Appeal rejected two lower court rulings from last year ordering U.S. prosecutors to share more information to support their allegation that the file-sharing service profited by encouraging large-scale copyright infringement by its users.
The decision is a minor setback for Megaupload's defendants, including founder Kim Dotcom, Finn Batato, Mathias Ortmann and Bram van der Kolk. The group was indicted in January 2012 in U.S. District Court for the Eastern District of Virginia on charges of criminal copyright infringement, money laundering, racketeering and wire fraud.
Megaupload's attorneys could not be immediately reached. In its 49-page judgement, the three-judge Court of Appeals panel wrote that the scope of an extradition court is limited. Challenges to the reliability of material may be considered, but the interpretation of evidence "is more appropriate to a trial than to an extradition hearing," it found.
The U.S. is required to present a prima facie case to justify extradition with a summary of evidence that is called "the record of the case," according to information published by the court. But extradition proceedings do not have the same protections and procedures as criminal trials.
If more documents are needed, the protocol is for the court to ask New Zealand's Minister of Justice to work with the U.S. in accordance with the two countries' extradition treaty.
In May last year, Judge David J. Harvey of the North Shore District Court ruled that the U.S. should turn over documents to the defense that support the allegation that Megaupload "willfully" infringed copyrighted material. His decision was mostly upheld in August by Justice Helen Winkelmann of New Zealand's High Court.
Megaupload, which at one time was one of the most popular services on the Internet, was shut down at the same time Dotcom's mansion outside of Auckland was raided in January 2012.
Despite pending criminal charges, Dotcom forged ahead and launched a new file-sharing service called Mega in January, emphasizing the service's privacy protections for users while discouraging its use as a platform for trading copyrighted material.