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Megaupload Case Has Far-Reaching Implications for Cloud-Data Ownership Rights

•, By David Kravets

The privacy and property rights of its 60 million users are also in jeopardy, as well as the privacy and property rights of anyone who stores data in the cloud, according to the Electronic Frontier Foundation, which is representing one of Megaupload’s users in a lawsuit against the government that could set a precedent for cloud users in general. A hearing on the issue in Virginia federal court is expected to be set any day.

The problem lies in the fact that there is currently no clear process for owners to retrieve property that federal prosecutors effectively seized when they shuttered the file-sharing and cyberlocker service last January over issues of alleged copyright infringement.

And even if a system is put in place for users to get back their files, it’s likely the data would first need to be reviewed by the government or a third party to determine if any of the data infringed copyrights, says EFF attorney Julie Samuels, because the government would oppose returning such data to account holders. But this raises serious issues about property rights and privacy at a time when more and more people are using the cloud.

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