Megaupload founder Kim Dotcom may be suing server hosting company Leaseweb over a “data massacre." The Dutch company says it deleted files from 630 servers due to lack of interest in them, but Dotcom has revealed letters proving otherwise.

The revelation comes a week after Dotcom accused the US government and Leaseweb of deleting millions of personal files without warning, including “petabytes of pictures, backups, personal & business property.”

Most of the permanently deleted data came from European users, with servers then re-provisioned to other customers – despite the fact that Megaupload had specifically requested that the hosting provider preserve the information.

“They deleted petabytes of data in the face of Megaupload’s data preservation notices. Our legal team asked them multiple times not to delete the data while the US court is deciding the pending cases including the rights of our users,” TorrentFreak quoted Dotcom as saying.

But Leaseweb’s senior regulatory counsel, Alex de Joode, said his company deleted the data and re-provisioned the servers “after a year of nobody showing any interest” in them.

“We did inform Megaupload about our decision to re-provision the servers,” de Joode said in a June 19 statement, thus disputing Dotcom’s accusation that the decision was made "without warning.” De Joode said that Leaseweb received no answer from the Megaupload team, so they “commenced the re-provisioning of the servers in February 2013.”

“To minimize security risks and maximize the privacy of our clients, it is a standard procedure at Leaseweb to completely clean servers before they are offered to any new customer,” he said.

To back up his accusations, Kim Dotcom has published an email which was sent from Megaupload’s legal counsel to Leaseweb in March 2012. The letter allegedly shows that Megaupload did, in fact, request preservation of the files.

"Megaupload continues to request that Leaseweb preserve any and all information, documentation and data related to Megaupload - as destruction by Leaseweb would appear to be in violation of amongst other things the applicable civil litigation data preservation rules and would interfere with evidence in a criminal matter [...]," said the letter. The email is signed by Megaupload lawyer Ira Rothken and addressed to Leaseweb’s A.H. Bram de Haas van Dorsser.

The email adds that “the Mega data on the servers at Leaseweb contain private and sensitive customer data and is subject to applicable privacy and data retention laws.”

“Megaupload is negotiating with the United States to discern feasibility of consumer data access and the conditions for the same," Rothken wrote in the letter. 

 The Electronic Frontier Foundation (EFF) representing the file-sharing website in court made a similar request to Leaseweb USA in April.

“We now write to formally request that you preserve that material both for purposes of contemplated future litigation and as a matter of obligation and courtesy to the innocent individuals whose materials have unfortunately been swept up into this case,” the EFF letter reads.

According to Dotcom, Megaupload’s legal team is analyzing whether Leaseweb violated the law.

“I can tell you that we are contemplating legal action against Leaseweb,” he told TorrentFreak on Wednesday.

“We believe that Leaseweb acted inappropriately under the circumstances when they destroyed data,” Rothken told the blogging website. “Ultimately we blame the United States who exercised constructive control over Megaupload’s assets and who had the obligation, resources, and ability to preserve all relevant and exonerating evidence including the data located at Leaseweb and failed to do so,” he added.

But Leaseweb claims it done nothing wrong. In a June 26 statement, the company stressed that “the contract between Leaseweb B.V. and Megaupload was governed by Dutch law.”

“This means the termination, and subsequent data retention needs to be valid under Dutch law. As there was no claim from the Dutch authorities on the data, the data was not subject to evidence rules. Also Dutch and European Privacy legislation prohibit giving third parties (i.e. MegaUpload customers, or Instra) direct access to their data,” the statement read.

Dotcom, who made a fortune from his file-sharing service Megaupload, is currently under a federal investigation, launched by the US Department of Justice after police raided his home. He is currently free on bail in New Zealand, with an extradition trial set for August.

The US has charged the Megaupload founder with facilitating copyright fraud on a massive scale, racketeering, and money-laundering, which carries maximum sentence of 20 years in jail.

Authorities claim Megaupload has cost copyright holders upwards of $500 million in lost revenues, due to content being illegally uploaded to its servers. The Department of Justice also believes Dotcom illegally earned $175 million by selling ads and subscriptions on the site.

On the anniversary of his arrest last January, Dotcom launched a new file-hosting site called ‘Mega.’

Kim Dotcom (Reuters / Nigel Marple)

 Tech mogul Kim Dotcom announced that he plans to be involved in next New Zealand general election while lobbying against a new legislation which would give spy agencies more powers to retrieve internet users’ personal information.

"I'm going to get engaged. I'm going to help as much as I can during the next election to make sure there is a government that takes the internet more seriously," said the founder of the file-sharing service Megaupload at the "Mega Breakfast" annual meeting of the Institute of IT Professionals , the New Zealand Herald reports.

He urged the IT community to carry out a campaign to improve government policy concerning internet business and issues. At the meeting he called to lobby against a new legislation that would require internet and telecoms companies to provide backdoor government access and approval for new technology.

The new proposed  bill would allow the New Zealand’s Government Communications Security Bureau (GCSB) to spy on its citizens on behalf of another agency, if they have a warrant.

The GCSB carried out domestic surveillance for the Security Intelligence Service, police and other agencies until last August, when the Kim Dotcom case raised questions about its legality. It was found that the GCSB were illegally spying on the Megaupload founder, a German national with New Zealand residency, prior to his arrest in January 2012 for alleged copyright violation.

Dotcom was subsequently arrested by the authorities who were aiding a US investigation into copyright violation. In March, Dotcom was granted the right to sue the secret services agency. According to an inquiry released in April, another 88 New Zealand citizens may have been illegally spied on.

Along with his Mega founder Mathias Ortmann he told the IT colleagues at the meeting that the recent revelations of the US NSA mass surveillance program by former CIA employee Edward Snowden, including New Zealand’s GCSB, had boosted the demand for his company’s encrypted cloud storage system.

At the Breakfast meeting Dotcom dismissed  Prime Minister John Key’s  statement that the spying law had been misunderstood.

"The law says you can't spy on New Zealanders. John Key stands in front of cameras and says 'we misunderstood the law'. How stupid can you get?"

The revelation of illegal spying by government agencies had created a potential shift in responsibility for the Megaupload business, said Dotcom.

"The potential settlement or damages situation has changed quite a bit since we discovered what went on. Potentially, at some point, we could go after the New Zealand government for full damages. I've said before I don't want to be a burden to New Zealand. The majority of that (settlement) would be reinvested in submarine cables, rural broadband."

The internet tycoon announced that he is currently involved with two investor groups and is set to start work on a second submarine cable to bring faster internet to New Zealand within 12 months.

The Institute billed Dotcom and Ortmann’s addresses as a chance to engage with those behind "New Zealand's largest tech start-up this year" said the NZ Herald.