While serial self-publicist Kim Dotcom was re-igniting the submarine cable debate in New Zealand, the Electronic Frontiers Foundation's (EFF's) case trying to recover files on behalf of a former Megaupload user Kyle Goodwin took a new twist.

The EFF has been in court trying to gain access to the servers seized by the Feds last year, when the Megaupload saga began. Access to the servers, they have argued, is necessary to help establish Goodwin’s case that his files should be returned.

In a filing that the EFF says should “terrify” users of any cloud service, the government is arguing that Goodwin’s property rights aren’t sufficient to demand access to the servers.

The government arguments are that Goodwin cannot demonstrate any “ownership” over the servers, since he merely paid for a service. Moreover, while conceding that Goodwin might have the right to assert his copyright, that is “not sufficient to establish that he has an ownership interest in the property that is the subject of his motion – the copies of his data, if any, which remain on Carpathia’s servers”.

The EFF also said that “the government … reviewed the content” of Goodwin’s files in what it says is an attempt to “shift focus to Mr. Goodwin, trying to distract both the press and the court from the government’s failure to take any steps … to protect the property rights of third parties either before a warrant was executed or afterward”.

However, it’s the government’s argument about property rights over files that The Register finds intriguing. While it seems to have the capacity, as stated by the EFF, to chill the cloud computing market, it’s an interpretation of intellectual property rights that would also be unwelcome in Hollywood. Content owners would hardly welcome a determination that the existence of a copy of data isn’t necessarily sufficient to establish ownership rights over that data. ®