Megaupload extradition case delayed until March 2013 Published duration 10 July 2012

image caption Megaupload's Kim Dotcom was visited by Apple's co-founder Steve Wozniak in June

A decision on whether Megaupload employees should be extradited to the US on copyright and fraud charges has been delayed until 2013.

A New Zealand judge has postponed next month's hearing to allow more time to resolve legal arguments.

It follows earlier rulings regarding the rights of the accused and the legality of a raid on the file-sharing site creator Kim Dotcom's mansion.

The US is set to appeal against both decisions.

The case has been rescheduled provisionally for 25 March.

Lost earnings

Mr Dotcom has been accused of copyright theft, money laundering and racketeering fraud and faces a jail sentence of up to 20 years if convicted in the US.

Prosecutors allege that pirated movies and other content shared through his site cost copyright holders more than $500m (£322m) in lost earnings, making it one of the biggest cases of its kind.

They claim Megaupload's staff paid users "whom they specifically knew uploaded infringing content", potentially encouraging the practice.

The US Department of Justice alleges the firm made about $175m from advertising and membership fees as a result of its activities.

Mr Dotcom's lawyers deny the charges saying the site simply offered an online storage service and that the majority of its traffic was "legitimate".

'One-sided'

The US filed a formal request for the extradition of Mr Dotcom and three of his associates in March but has faced a series of setbacks in New Zealand's courts.

In May a judge said the US should share the evidence it had gathered from its seizure of Megaupload's computer equipment before the extradition hearing to prevent it from becoming a "one-sided" affair.

In June another judge ruled that the search warrants used to raid Mr Dotcom's home had been invalid because they had failed to "adequately describe" the offences being investigated.

Mr Dotcom is currently under house arrest at his Auckland home. He has been tweeting his thoughts since a ban preventing him using the internet was lifted in April.