Dotcom's new service could breach bail conditions

Kim Dotcom could breach his bail terms or face further charges if he goes ahead with plans to start a new file-sharing service like his shuttered Megaupload site, a United States attorney warns.

The internet entrepreneur said on Twitter last month that a new file-sharing website was nearing completion and lawyers, partners and investors were ready for its launch.

Plans for the new service came after the Megaupload site was shut down as part of the United States copyright infringement case against Dotcom and his business partners.

In a court motion filed by the US Department of Justice this week, attorney Neil MacBride warned a new site could breach Dotcom's bail conditions or subject him to new charges.

The court papers cited a January bail application affidavit in which Dotcom said there was no realistic prospect or possibility of restoring his business.

"There is no ability for me to reinstate Megaupload either as it was prior to the police operation or as some new iteration of the site,'' he said.

Mr MacBride questioned whether Dotcom had intentionally misled the New Zealand courts to secure his release on bail.

"Defence counsel's claim that the corporate defendant can and should be allowed to operate undermines the sworn statements of Dotcom that he has no plans or ability to continue to operate or fund the businesses in the indictment during pendency of the extradition process.

"If defendant Dotcom intentionally misled the court in New Zealand about his intentions and capabilities in order to obtain his release from pre-extradition confinement, it seems defence counsel's representation might endanger Dotcom's bail situation or even subject him to additional charges.''

Dotcom's lawyer Ira Rothken said his client was innocent and he was entitled to be involved in business.