The copyright industry upped the ante by getting the New Zealand government involved in its fight against Kim Dotcom, but yesterday's High Court decision declaring the search and seizure of Dotcom's property illegal shows the move could backfire on them says Internet New Zealand CEO Vikram Kumar.
Auckland High Court justice Helen Winkelmann said the warrants "did not adequately describe the offences to which they related. Indeed they fell well short of that. They were general warrants, and as such, are invalid." She also found the release of cloned hard drives to the FBI for shipping to the United States breached the law.
"They [copyright holders] used the government as an arm to enforce their own private rights," says Kumar.
"Now they need to be thinking whether to stay the course, and try and win it the US or should they try to minimise the damage and get out now. In a civil case the rights holders could opt to settle out of court or by other means, but that's not open to them right now."
Kumar adds that although justice Helen Winkelmann's decision would be a blow to the prosecution case in New Zealand, it would not stop the copyright holders from pursuing a case against Dotcom.
"I don't think this will put a damper on it. Hollywood and the copyright industry have a long history of expanding their efforts in cases like this," says Kumar.
"If anything I think it's going to continue for many years."
On Justice Winkelmann's decision which found the release of cloned hard drives to the FBI for shipping to the United States breached the law, Kumar says this area of the law requires more inspection by the government and criminal forensic experts.
"The crown previously advanced an argument that by copying data and giving it to the defendant it would somehow weaken the data's integrity," says Kumar.
"This is something the industry and government need to inspect. Forensic copying of data is important, and something the government is actually quite good at."
"What this decision shows is anyone that argues that copying data somehow makes it less credible is probably incorrect."
Kumar says he has invited Dotcom to speak at InternetNZ's Net Hui conference next month to speak about the commercial aspects of creating a cloud business, but Dotcom has declined.
"I guess he's missed an opportunity to speak on that," he says.
US authorities claim Dotcom and co-accused Mathias Ortmann, Fin Batato and Bram van der Kolk used the Megaupload website to knowingly make money from pirated movies and games. They have charged him in the US with multiple copyright infringement offences. An extradition hearing has been set down for August 6.
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