Fair enough, so what sanctions against groups like Megaupload?
If the copyright holder can reliably, without any doubt, show that a certain files or files there contain their protected material, then Megaupload should be notified, and in turn forced remove that/those file(s). If they fail to do so within a reasonable amount of time, then monetary sanctions (after it went to court, of course) are in order, as with every other proven copyright infringement. Also, after a court ruled so, Megaupload should be forced to hand out user-account information and/or the IP address data of the user who uploaded it, plus access time when that upload happened.
Simple as that, since Megaupload is not the one who uploaded the file(s) in the first place. They simple provide a service which may or may not be used for crimes by others.
However, in no way should they, or anyone else operating such a (or similar) service be forced to hand out that information just because of the say-so of any alleged copyright holder. There must be proof first that the claimant is indeed the copyright holder to force them to delete that/those file(s). Any further action, like handing out user-account data, should be required only after a court has ruled so.
This is about privacy and security of users as well. Giving any company the power to demand such data just by say-so opens up a huge privacy risk. Imagine some oppressive regime requesting such data under the disguise of copyright infringement, just because they found that some user uploaded a regime-critical pamphlet or similar.
Corporate greed and wishes have to stand back and respect citizens rights first. They already invaded those rights far too deep. It's time that this stops and gets reversed.
What they actually want would translate, for example, to holding car manufacturers responsible for the faults of the actual drivers causing accidents, plus the drivers themselves, and then some.
Greetings,
Chris
ETA: Oh, and keep in mind that all the sanctions/etc. that i proposed here are already possible under current law. It's not the users or the providers fault that they don't use them. Yes, going that way requires some effort, and in some cases some money. But then, that's what they are there for: to protect the rights of their artists/etc. That's what they get paid for, and no little sums for that matter.