Megaupload co-founder's bail 

appeal rejected by court

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Megaupload founder Kim Dotcom'

s bail application appeal has been rejected in New Zealand.

The High Court in Auckland said it agreed with an earlier 

ruling that Mr Dotcom - a German national - might try to flee the country.

The file-sharing site creator is accused of profiting 

from the copying and distribution of pirated content.

Mr Dotcom's lawyers said that he denied the charge 

and would fight an extradition application by the US.

Prosecutors had said Mr Dotcom - also known as Kim Schmitz 

- posed an extreme flight risk, noting that he had passports and 

bank accounts in three names and a history of fleeing criminal

 charges. They said measures, such as electronic monitoring, 

were likely to prove ineffective.

'Go to hell'

Lawyers representing the US authorities also said that a man 

with a history of making fake travel documents had 

unsuccessfully asked to visit Mr Dotcom following his arrest.

Mr Dotcom's said he had no intention of running away. 

He said he wanted to be with his pregnant wife and fight

 to get his assets unfreezed. He also denied all knowledge 

of the rejected visitor.

"If people were to approach me and to offer such a service, 

I would tell them to go to hell," Mr Dotcom said.

He added that he had also been contacted by a man claiming 

to be a prosecutor, who had said he could organise a favourable 

bail hearing in return for a payment.

He also complained that he had been sent letters from female

 prison inmates asking to become his pen pals.

Mr Dotcom's next court appearance is scheduled for 22 February, 

when his extradition hearing is planned.

Data deletion

Megaupload has been offline since 19 January, when the US 

government forced its shutdown and executed search warrants 

on two companies that provided it with file hosting services - 

Cogent Communications and Carpathia Hosting.

Megaupload lawyer Ira Rothken tweeted earlier this week

 that the hosting firms had agreed to preserve consumers' 

data until at least mid-February.

The US-based digital rights group Electronic Frontier 

Foundation has since written a letter hinting it might 

begin its own legal action if the service providers

 consequently tried to wipe the data, now that they 

were no longer being paid by Megaupload to store it.

"Many innocent third parties... used Megaupload for 

wholly legal purposes and have since lost access to their data,"

 wrote the organisation's legal director, Cindy Cohn.

"Many of these materials are property of the individuals 

involved, and they are legally entitled not only to access

 but to preservation and privacy.

"We are hopeful that our client and other third parties 

can obtain access to their material without resorting to

 legal action, but if that is not the case, we intend to take

 the necessary steps to ensure the return of their materials."