UPDATE: PS3 Hacker Did Not Flee To South America

The legal battle between Sony Computer Entertainment America and a hacker who published a jailbreak has taken a new turn in the wake of accusations that he deliberately withheld evidence from Sony.

Sony sued George Hotz for violating copyright and California law by publishing a jailbreak for the PlayStation 3 that allows other operating systems to be run on the console. Sony's complaint also says Hotz acted to circumvent the copy protections built into the device and trafficked in circumvention devices and components thereof. The trafficking refers to Hotz publishing the code on his blog.

Stories were circulating that Hotz, who used the moniker geohot, had fled to South America to slow Sony's lawsuit, which asks for damages and a restraining order. Sony had also filed court papers charging that Hotz. Who was ordered to deliver his hard drives to a neutral party, The Intelligence Group, did so only after removing vital parts.

Hotz's lawyer, Stewart Kellar, issued a statement to IGN saying that the parts of the hard drive have been delivered. Kellar also said there isn't any reason for Hotz to go to South America to escape the lawsuit, as it is a civil and not a criminal case.

Meanwhile, Hotz, on his blog, said he had planned the trip to South America since November. I mean, it is Spring break; hacking isn't my life, he wrote.

A big part of the legal battle between Sony and Hotz has been over where the case should be argued. Hotz and his legal team say it should be in New Jersey, where Hotz lives. Sony says it should be in California. If Sony can show that it was harmed in California, then the judge will probably grant its motion to have the case tried there.

In its latest filings, Sony says it has evidence Hotz opened up a PlayStation Network account. It then cites the terms of service that say anyone who sets up a PSN account is in a binding agreement with Sony, which explicitly states that any disputes with the company must be brought to court in San Mateo County.

Sony says Hotz created an account under the name blickmaniac that matches the serial number of the PlayStation 3 that Hotz bought in February 2010. By creating an account on the PSN, Hotz has essentially said he is willing to submit to the jurisdiction of a California court, as per the terms of service.

On top of that, Sony argues that a large number of people downloaded Hotz's jailbreaking software live in California. Therefore, the company argues, the case should be argued in California because the harm Sony suffered (the jailbreaking) occurred there.

Hotz's lawyer has argued against arguing the case in California because it would be a hardship for him to travel to there and it would set a precedent for companies being able to assert jurisdiction over anyone, anywhere, on relatively flimsy grounds.

Hotz has argued that the software he wrote only restores functions to the PS3 that were there before, as earlier versions of the firmware allow it to run other operating systems. Current versions do not allow this.

Suing hackers might not necessarily solve the problems Sony has with pirated software or unauthorized firmware modifications. A Sony employee accidentally re-tweeted the code key to the PlayStation 3, which would allow any user to get around the very copy protections and firmware restrictions Sony is currently arguing about in court.

Sony has issued an update to the PlayStation 3s operating system, to protect it against such modifications. Loading the update was required for anyone who wanted to use the PlayStation 3 network. But a Canadian software developer, Youness Alaoui, has also published a workaround. Alaoui says the code he published is legal in Canada, and what he wrote doesn't allow for pirated games to be run, so he isn't violating copyright, and he has not published the actual code.