A New Zealand court has ruled that search warrants used when 70 police raided the New Zealand mansion of the suspected kingpin of an internet copyright theft ring were illegal.
German national Kim Dotcom, also known as Kim Schmitz, was one of four men arrested in January as part of an investigation into his Megaupload.com website led by the FBI.
Prosecutors say Dotcom was the ringleader of a group that has netted $175m since 2005 by copying and distributing music, movies and other copyrighted content without authorisation.
Dotcom's lawyers say the company simply offered online storage.
On Thursday, High Court Judge Justice Helen Winkelmann found the warrants used in the seizure of property from Dotcom's mansion near Auckland were illegal and that moves by the FBI to copy data from Dotcom's computer and take offshore were also unlawful.
"The warrants did not adequately describe the offences to which they related," Winkelmann said in her ruling. "Indeed they fell well short of that. They were general warrants, and as such, are invalid."
In response, New Zealand's police said in a statement they were considering the judgment and were in discussions with Crown Law "to determine what further action might be required".
Police said no further comment would be made until that process was complete.
Dotcom is on bail in New Zealand, as US authorities seek to extradite him on charges of copyright theft and money laundering.
Officers cut Dotcom out of a safe room he had barricaded himself in within the sprawling mansion - reputedly New Zealand's most expensive home.
Millions of dollars in assets were seized or frozen, including almost 20 luxury vehicles, dozens of computers and expensive art works.