The intention may well have been this all along - to destroy the site and instill fear.  The case was probably unwinnable.

Charges against Megaupload may never go to trial

Radio New Zealand,

22 April, 2012

The company's owner, Kim Dotcom, is in Auckland, facing extradition proceedings.

Megaupload, which was the world's biggest file-sharing website, was closed down in January following charges led by the US department of Justice.

A US district court judge has expressed doubts about the case and Megaupload's US lawyer, Ira Rothken, says it is strange the authorities there knew about the failure to serve the papers.

Mr Rothken says the issue is a major hiccup for the prosecution's case.

"This is a procedural bug that the US ought to have contemplated in advance."

Megaupload was indicted in a federal court in Alexandria, Virginia, on 19 January and the site was then shut down.