The battle between Megaupload and the U.S. Government is heating up. In a new document filed at the federal court Megaupload's legal team accuses the Department of Justice of making up its own rules, while disrespecting foreign sovereignty. The U.S. is intentionally maintaining "flawed criminal action" in a case that should be dismissed, they argue.

Last month Megaupload asked the court to dismiss the case because U.S. law doesn’t permit criminal proceedings against foreign companies.

The issue has become crucial in the ongoing Megaupload proceedings, as it may lead to a premature dismissal of the case.

According to “Rule 4” of criminal procedure the authorities have to serve a company at an address in the United States. However, since Megaupload is a Hong Kong company, this was and is impossible.

As a result Megaupload asked the court to dismiss the case, but this request was opposed by the Government last week. According to the Government, the federal rules shouldn’t be interpreted so narrowly. A company should only be served on a U.S. address if they have one, the U.S. argued.

Megaupload’s team is not buying into this argument and submitted a detailed rebuttal to the court yesterday, explaining why the case should be dismissed.

“If the drafters‘ sole objective in imposing the mailing requirement was to ensure that a corporate defendant received sufficient notice, they could have drafted the rule to require that the Government send a copy of the summons to the company‘s last known address anywhere in the world.

Instead, the drafters specifically mandated that the summons be mailed to an address within the United States.”

In addition Megaupload’s legal team replies to the Government’s argument that it’s not required to serve a company as long as “the corporate defendant receives sufficient notice of the charges.”

This reasoning is “self-invented” and not supported by previous cases according to Megaupload. Instead, it’s an attempt to “rewrite — or, rather, erase” existing rules.

Talking to TorrentFreak, Megaupload lawyer Ira Rothken reiterated that the Department of Justice is not playing by the book.

“The DOJ failed to follow the rules which requires a foreign corporation to have an office in the United States as a condition of service of an indictment,” Rothken said.

“Megaupload Ltd is a Hong Kong corporation and has never had an office in the United States. The rules on service of an indictment are designed in part to respect foreign sovereignty,” Rothken adds.

While the DOJ’s failure might have been the result of sheer incompetence, the fact that the Government continues to ignore the rules is clearly intentional.

“The DOJ has read Megaupload’s motion to dismiss and refused to voluntarily dismiss the indictment against Megaupload – the DOJ maintenance of such a flawed criminal action if brought by mistake is now intentional,” Rothken told TorrentFreak.

Megaupload’s legal team has requested that the court discuss the above, and several other points that were raised, in an oral hearing later this month.