SUPERIOR COURT OF JUSTICE – ONTARIO

COURT FILE NO.: M-9-11/12

DATE: 20130109

IN THE MATTER of an application made pursuant to section 11(2) and 12(1) of the Mutual Legal Assistance in Criminal Matters Act for a search warrant

AND IN THE MATTER of an application by the Attorney General of Canada on Behalf of the United States of America pursuant to s.15 (1) of the Mutual Legal Assistance in Criminal Matters Act for an Order to Copy and Copy and Send certain Data to the Government of the United States of America

RE: ATTORNEY GENERAL OF CANADA ON BEHALF OF THE UNITED STATES OF AMERICA v. EQUINIX INC. v. MEGAUPLOAD LTD.

BEFORE: Justice Pardu

COUNSEL:
Moiz Rahman, for the Minister of Justice

Scott C. Hutchison, for Megaupload Ltd.

HEARD: January 7, 2013

ENDORSEMENT

[1] The Attorney General of Canada applies for an order pursuant to s. 15 of the Mutual Legal Assistance in Criminal Matters Act (the Act) sending mirror-imaged copies of thirty-two computer servers to authorities in the United States of America.

[2] These servers were seized on January 19, 2012 pursuant to a search warrant issued by McMahon J. on January 18, 2012.

[3] The Respondent does not dispute that the evidence submitted to McMahon J. justified the issue of the warrant. That is to say, the evidence met the test required by s. 12 of the Act that there were statements under oath constituting reasonable grounds to believe that an offence had been committed and that evidence of the commission of the offence will be found in a building, receptacle or place.

[4] Equally, there is no dispute that the warrant was executed according to its terms and conditions.

[5] The Respondent’s position is that there is an enormous volume of information on the servers and that sending mirror image copies of all of this data would be overly broad, particularly in light of the scantiness of the evidence connecting these servers to the crimes alleged by the American prosecutors.

[6] The American prosecutors allege that individuals and the Respondent Megaupload Ltd. were parties to an offence of criminal infringement of copyright, conspiracy to infringe copyright, money laundering and racketeering. The allegation is that Megaupload Ltd. facilitated wrongful dissemination of copyright protected material such as movies and music.

[7] There are claims that the website operated by the Respondent had at least 50 million daily users and that the losses are conservatively estimated at $500,000,000.00. A search of 12 different email accounts of directors and employees of Megaupload Ltd. and Megavideo Ltd. over a period of about 69 months produced over 10 million emails. The Respondent has hundreds of servers and carries on business in at least four other countries. The means whereby it is said to disseminate copyright material are highly complex.

[8] The link said to connect the 32 servers to the crimes alleged is an email from one of the alleged conspirators indicating that these servers “will serve as a database / number crunching machines.”

[9] The Respondent submits that the volume of data on these servers is the equivalent of that contained on 100 laptop computers, and that the court should either refuse the sending order or in the alternative make an order under s.15 (2) of the Act compelling the servers seized to “be brought before the court in the form of a report from an independent forensic examiner who can inform the court as to the nature of the information contained on the 32 servers”.

[10] Section 15 of the Act provides:

15. (1) At the hearing to consider the execution of a warrant issued under section 12, after having considered any representations of the Minister, the competent authority, the person from whom a record or thing was seized in execution of the warrant and any person who claims to have an interest in the record or thing so seized, the judge who issued the warrant or another judge of the same court may

(a) where the judge is not satisfied that the warrant was executed according to its terms and conditions or where the judge is satisfied that an order should not be made under paragraph (b), order that a record or thing seized in execution of the warrant be returned to

(i) the person from whom it was seized, if possession of it by that person is lawful, or

(ii) the lawful owner or the person who is lawfully entitled to its possession, if the owner or that person is known and possession of the record or thing by the person from whom it was seized is lawful; or

(b) in any other case, order that a record or thing seized in execution of the warrant be sent to the state or entity mentioned in subsection 11(1) and include in the order any terms and conditions that the judge considers desirable, including terms and conditions

(i) necessary to give effect to the request mentioned in that subsection,

(ii) with respect to the preservation and return to Canada of any record or thing seized, and

(iii) with respect to the protection of the interests of third parties.

(2) At the hearing mentioned in subsection (1), the judge may require that a record or thing seized in execution of the warrant be brought before him.

[11] Where a judge is satisfied that a sending order should not be made the judge may order the return to the lawful owner or possessor of the material. A judge may alternatively order the material sent to the requesting state on any terms and conditions the judge considers desirable or may require the thing seized be brought before him or her.

[12] The jurisprudence is divided on the issue of where the onus lies on an application of a sending order.

[13] The Crown indicates that if I order the servers brought before the court, counsel will consult as to whether some consensual means can be established for sorting the irrelevant from the potentially relevant data on the servers.

[14] Given the nature of the allegations, it is likely that the volume and breadth of data relevant to the prosecution as a whole is enormous. Financial, web traffic and transactional information are all likely to be relevant.

[15] In R. v. Jones 2011 ONCA 632, the Court rejected the notion that authority to search a computer gave unfettered access to all data there located, at paragraphs [24], [25] and at paragraph [46]:

[24] This is not because the warrant should be struck as “too broad”, in the sense that it contained no limitations on the ability of the police to search the computer, and therefore improperly invaded the high expectation of privacy the respondent had in the contents of his computer, as the respondent argues. It is because the warrant itself is properly restricted in the circumstances. Although it contained no limitations on the types of files that could be examined, it was reasonably focused and limited in the types of evidence the police could seek; and that evidence did not include evidence of child pornography.

[25] In addition, I do not accept the Crown’s argument that the warrant authorized the search because a computer is an indivisible object which, like pieces of physical evidence, can be tested and inspected in whatever ways the police deem necessary once law- fully seized under the warrant. I also reject the somewhat connected suggestion that because the right to seize a computer would be a hollow one without the ability to examine its contents, it must follow that the police are entitled to examine the entirety of the contents.

[46] Put in terms of this case, the argument is that a warrant containing no limiting terms with respect to the parts of the computer that could be searched, properly authorizes a full examination of all the data stored on the computer as if it is one indivisible item. I do not accept this view, however. In my opinion, the analogy between forensic testing of a physical object and the examination of the contents of a computer is not an apt one. Unlike a physical object, it is not information generated by the physical characteristics of or adhering to the object that is the target of the search. It is the informational contents of the computer themselves that are the tar- get of the search. This is a qualitative difference.

[emphasis in original]

[16] Given the undisputed conclusion by McMahon J. that there were reasonable grounds to believe that evidence of the offences would be located on the servers in my view the appropriate balance of the state interest in gathering evidence and privacy interests in information can be struck by an order that the servers be brought before the court pursuant to s.15 (2) so that the court can make an order refining what is to be sent. By this, I do not mean that at this stage the servers must physically be delivered to the courthouse. The application for a sending order is adjourned without a fixed return date, returnable on 7 days’ notice. If counsel are unable to agree as to how the scope of relevant material is to be defined then the matter may be brought back before a judge of this court for determination of that issue.

PARDU J.

Date: January 9, 2013