Beyond the interesting questions of jurisdiction, the move will show to be completely ineffective in accomplishing their goal and more disruptive to law abiding users then the copyright violators. It is the equivalent of shutting down Greyhound bus and confiscating everything on board from all of the riders because the government found a few riders had marijuana in their pockets. Drugs will still find their way to their destinations without greyhound, and a lot of people will be inconvenienced, punished for the violations of others.
Video embedded below.
"The government takedown of Megaupload, a popular file-sharing site, has stoked simmering fears that hard-line enforcement of copyright infringements could profoundly disrupt Internet commerce.
File sharing has become a major way corporations collaborate with employees and partners and interact with customers. It fuels the sharing of rich content across Internet-connected devices in the home and office and distributed to mobile devices and has emerged as a major component of cloud computing, the delivery of content and services across the Web.
"If legitimate content is housed on the same service that might have infringing content, it gets sucked into this vortex and it's gone," says Dennis Fisher, security blogger at Threatpost.com. "I don't know how much the government or these companies (advocating strict anti-piracy enforcement) have thought this through. I would guess not a lot.""