A judge in the United States wants to hear more evidence before deciding whether copyright charges against Megaupload should be dropped.
At a court hearing in Virginia on Friday (local time), District Judge Liam O'Grady asked Megaupload and the US government to prepare their cases which will be heard in mid-July.
Megaupload lawyer Ira Rothken says it is a positive step.
He says Judge O'Grady also indicated that if the copyright charges are not dismissed, Megaupload founder Kim Dotcom can apply to have his funds unfrozen to pay for his defence.
The judge also deferred a decision on whether Megaupload users should regain access to their files that were seized by the US government.
Megaupload was indicted in a federal court in Virginia on 19 January this year and the site was shut down. Mr Dotcom and three co-accused were arrested in Auckland, New Zealand, the following day.
Formal papers requesting their extradition were lodged by the United States in early March.