Warrants used to seize external hard drives, laptops and phones from Megaupload founder Kim Dotcom's mansion in January are illegal, a New Zealand High Court judge ruled on Thursday.
The overly broad warrants allowed for the seizure of a broad category of items, only some of which are relevant to the US charges of criminal conspiracy and copyright infringement, wrote Justice Helen Winkelmann in her judgement.
"The warrants did not adequately describe the offense to which they related," Winkelmann wrote. "Indeed they fell well short of that. They were general warrants, and as such, are invalid."
Winkelmann said she needed to hear from Megaupload and New Zealand government attorneys before proceeding further. A hearing is scheduled for July 4 at 10 am. New Zealand government attorneys can appeal.
New Zealand police said in a statement that they "are considering the judgement and are in discussions with Crown Law to determine what further action might be required".
One of Megaupload's attorneys, William Akel, said via email that Dotcom as well as defendants Finn Batato, Mathias Ortmann and Bram Van Der Kolk were pleased with the decision.
"We are now considering the implications of the rulings," Akel wrote.
The US is seeking the extradition of Dotcom, who is accused with six other individuals and two companies of profiting by encouraging Megaupload users to share material under copyright without permission. Megaupload displayed advertising and sold subscriptions for faster downloads of content.
US authorities contend Megaupload made as much as £112 million (US$175 million) while causing £321 million ($500 million) in damages to copyright holders.
During a raid at Dotcom's mansion outside of Auckland on 20 January, police seized up to 150 terabytes of data, some of which is encrypted. Portions of the data was copied by Federal Bureau of Investigation agents and sent to the US.
Winkelmann ruled New Zealand police violated the law by releasing the data to the US. The Megaupload plaintiffs did not consent to the shipment of copies of the data to the US, she wrote.
An independent barrister should be appointed to conduct a review of the items seized and identify material that is either irrelevant to privileged, she wrote.