DotCom Warrant Judgment: Text

Thursday, 28 June 2012, 5:50 pm
Article: Scoop News

The following is the result of automatic text-recognition on today's judgment regarding police actions regarding Kim DotCom's property in the Megauplaod case. It contains formatting and text errors. The original judgment [PDF] should be used for reference.

IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY
CIV-2012-404-1928
[2012] NZHC 1494
UNDER the Judicature Amendment Act 1972
IN THE MATTER OF an application for judicial review and
application for order for interim relief
pursuant to section 8
BETWEEN KIM DOTCOM
First Plaintiff
AND FINN BATATO
Second Plaintiff
AND MATHIAS ORTMANN
Third Plaintiff
AND BRAM VAN DER KOLK
Fourth Plaintiff
AND ATTORNEY-GENERAL
First Defendant
AND THE DISTRICT COURT AT NORTH
SHORE
Second Defendant
Hearing: 22 and 23 May, 6 June 2012
Counsel: P Davison QC (22 & 23 May only), W Akel and R Woods for First
Plaintiff
G J Foley for Second, Third & Fourth Plaintiffs
M Ruflin (22 and 23 May only), F Sinclair for First Defendant (joined
in capacity as representative of New Zealand Police)
J Pike and A Toohey (6 June only) for First Defendant (joined in
capacity as the Central Authority for the purposes of the Mutual
Assistance in Criminal Matters Act l992)
Judgment: 28 June 20l2
JUDGMENT OF WINKELMANN J
DOTCOM & ORS V ATTORNEY-GENERAL HC AK CIV-2012-404-1928 [28 Junc 2012]

T his judgmeni was delivered by me on 28 June 2012 ai 3.30 pm pursurmi I0
Rule 11.5 ofthe High Court Rules.
Registra17Depz1Iy Registrar

TABLE OF CONTENTS
Introduction
A. Were the warrants invalid?
(i) Factual background
Execution of Warrants and items seized
(ii) Judicial review of search Warrants issued under the MACMA
(iii) Is the offence adequately described in the warrants
(iv) Was there adequate definition ofthe authority to search
and seize
(v) Should conditions have been imposed?
B. Did the Police seize items outside the scope of the search warrant?
C. Was the provision by the Police of copies of digital tiles to the FBI
unlawful?
(i) Does s 49 regulate physical custody of an item only?
(ii) Did the plaintiffs consent to images of computer hard drives
being shipped to the FBI oifshore?
First phase
Second phase
Third phase
Was there consent?
(iii) Would the Solicitor-General have consented to the shipment?
Summary of findings
Relief
U]
[9]
[20]
[27]
[36]
[51]
[73]
[37]
[90]
[93]
[93]
[104]
[118]
[122]
[134]
[141]
[144]
[145]

Introduction
[1] The government of the United States of America seeks extradition of the
plaintiffs in relation to charges stemming from their operation of the Megaupload
business, a business which allows customers to upload bulk amounts of data to the
internet, and share that data with others. The allegation is that the Megaupload
platform has been used by customers in widespread breach of copyright. The
United States has asked the Attorney-General of New Zealand for the New Zealand
Police’s assistance with the investigation of that suspected criminal offending. That
request has been made under the Mutual Assistance in Criminal Matters Act l992
(MACMA), an Act to facilitate the provision and obtaining of international
assistance in criminal matters.
[2] In fulfilment of that request the Police have taken a number of steps including
arresting the plaintiffs, carrying out searches, seizing assets, and obtaining orders
freezing assets. The plaintiffs seek a judicial review of three search warrants issued
by the North Shore District Court and executed by police in January 2012 at
addresses associated with the first plaintiff Mr Dotcom, and the fourth plaintiii;
Mr Van Der Kolk, but at which assets of all four plaintiffs were seized.
[3] The plaintiffs allege that the search warrants were unlawful. They contend
that the warrants were unreasonably broad in their terms; lacking specificity as to the
charges to which the searches related, and as to the items to be searched for. It is
further argued that the warrants should have prescribed a process for dealing with
items taken away following the search, because the warrant authorised the search
and seizure of digital storage devices which would inevitably store at least some
irrelevant information. It was also known that the items seized were to be sent to the
investigating authorities in the United States. It is argued that the Court should have
stipulated conditions for the return to the plaintiffs of the original items, or at least

clones] of those items, and a procedure for safeguarding irrelevant and privileged
material from access by the investigating authorities.
[4] The plaintiffs also seek to review the actions of the Police in executing the
search warrants, on the grounds that they exceeded their powers in seizing and
holding the items that they did.
[5] The first defendant was originally joined in the proceedings for, and on
behalf of the Police. During the course of the initial hearing of the application for
review, I was told by counsel for the first defendant that the Police had allowed the
FBI to ship to the United States images of the content stored on the digital storage
devices, that is to say, clones of the hard drives of those devices. The Police sought
leave to file further evidence explaining the circumstances in which this occurred.
That leave was gr'anted and the initial hearing came to an end.
[6] Following the r'eceipt ofthe additional information, the plaintiff`s sought leave
to amend their pleadings to add to the relief sought a declaration that removal from
New Zealand of clones of the hard drives was unlawful. That leave was granted
unopposed. At the request of the first defendant, there was then a further day’s
hearing in respect of this new aspect to the proceeding. I gave leave to Mr Pike and
Ms Toohey to appear as counsel for the first defendant, but appearing for the
Attorney-General in the Attorney’s capacity as the Central Authority for New
Zealand. “Central Authority” is defined in the MACMA as “the person or authority
for the time being designated by that country for the purposes of transmitting or
receiving requests made under or pursuant to” MACMA.2
[7] The plaintiffs now seek relief in the amended statement of claim which
includes declarations that the warrants and removal of clones from New Zealand
were unlawful, and also the making of orders as to how the items seized are to be
dealt with by the Police.
I Throughout this judgment the expressions cloning and imaging are used interchangeably. There
is some evidence that the processes involved in cloning and in forensic imaging may be
different, but that difference is not material for the purposes of this judgment.
2 Mutual Assistance in Criminal Matters Act 1992, s 2.

[8] The issues that arise in this proceeding are as follows:
(i) Were the warrants invalid because of lack of detail as to the oifences
to which they related, and the parameters of the search, and/or
because ofthe failure to attach sufficient conditions?
(ii) ln any case, have the Police exceeded the authority conferred upon
them by the warrants?
(iii) Did the Police act unlawfully in allowing the FBI to transport clones
of hard drives overseas?
(iv) What, if any relief should be granted in comiection with any
invalidity or illegality?
A. Were the warrants invalid?
(0 Factual bnckgrozmd
[9] The plaintiffs have interests in the Megaupload group of companies, which
includes Megaupload Limited, Megavideo Limited and Megastutf Limited, the latter
a New Zealand registered company. The plaintiffs Mr Dotcom and Mr Van Der Kolk
are resident in New Zealand.
[10] On 5 Janualy 2012, prosecuting authorities in the United States obtained an
indictment from a Grand Jury in the State of West Virginia, charging the plaintiffs,
along with other individuals and corporate entities (including Megaupload Limited),
with breach of copyright, conspiracy to breach copyright, conspiracy to racketeer
and money laundering. Under United States law, “racketeering” involves a criminal
enterprise that is focused on committing or furthering any of a number of criminal
olfences, including money laundering and criminal breach of copyright.
[l l] The charges flow Hom the activities of the Megaupload business. The FBI
contends that the plaintiffs and companies in the Megaupload group were part of a

conspiracy, which the FBI for operational purposes has called the “mega-
conspiracy”. The criminal objects of the conspiracy are alleged to have been to
administer intelnet websites which were used by others to reproduce and distribute
iniringing copies of television programmes, software, music and motion pictLu'es,
and also to conduct monetary transactions with the proceeds of those unlawlial
activities. The FBI’s case is that Megastuff Ltd was involved in the transfer and
distribution of illicit proceeds generated from the website.
[12] From early 2011 the Police were involved in providing direct assistance to
the FBI in relation to the FBI’s investigation. Police assistance was initially
provided infoimally, on an agency to agency basis, but in a letter dated 11 January
2012 the United States Central Authority3 requested the Attorney-General for
assistance on a government to government basis.4 The letter stated that various
authorities, including the FBI were investigating the “mega-conspiracy”, its oiiicers
and employees, including Mr Dotcom and Mr Van Der Kolk and Megastuff Ltd. It
was alleged that members of the mega-conspiracy knew how their websites were
used by others, had themselves used the systems to upload as well as reproduce and
distribute copyrighted content and were aware that they had benefited financially
directly from massive intiingement of copyrighted material. The United States
Central Authority sought assistance including:
assistance in the search of property and seizure of evidence located in
New Zealand; in the interviewing of \vitnesses and targets; and in the
collection of other business and official records.
[13] The letter of request stated that evidence was needed in order to iinther
demonstrate that the mega-conspiracy’s directors and employees were awa1'e that
Megaupload’s websites were regularly used to reproduce and distribute inhinging
copies of copyright works, to gain a better understanding of and document the mega-
conspiracy’s activities, and to identify additional individuals who were working with
the mega-conspiracy. The United States Central Authority requested that two
properties of Mr Dotcom be searched at a time when it was known that Mr Dotcom’s
3 Department of Justice of the United States of America.
4 The Department of Justice is the requesting, and the Attorney-General the receiving, Central
Authority,

business associates, Mr Batato and Mr Ortmami, would be present, attending
Mr Dotcom’s birthday celebration. The property of Mr Van Der Kolk was also to be
searched. Law enforcement authorities were asked to seize “all evidence, lruits and
instrumentalities of the crime being investigated, including, but not limited to, the
following ...”. The letter then listed six categories of documents and things that
should be seized, and concluded, at page 36:
Please have the seizing oiiicials complete the attached Certificate With
Respect to Seized Items and forward tl1e seized articles with the certificate to
the appropriate authorities for transmittal to the United States.
[14] On 17 January 2012, the Deputy Solicitor-General, acting with the delegated
authority of the Attorney-General,5 issued an authorisation for the Police to apply for
sea1'ch warrants for the search and seizure of “evidence, fruits and instrumentalities”
including but not limited to the six categories of documents and things. The
authorisation stated that the relevant oiTences alleged to have been committed under
United States law for the purposes of the warrant were:
Conspiracy to commit racketeering, in violation of title 18 United States
Code, Section 1962(d), which carries a maximum penalty of twenty years of
imprisonment.
Conspiracy to commit copyright inningement, in violation of Title 18,
United States Code, Section 371, wl1icl1 carries a maximum penalty of live
years of imprisonment.
Conspiracy to launder monetary instruments, in violation of Title 18, United
States Code, Section l956(h), which carries a maximum penalty of twenty
years of imprisonment.
Criminal copyright inningement by distributing a work on a computer
network, and aiding and abetting of criminal copyright inningement, in
violation of Title 18, United States Code, Sectio11s 2 & 2319, and Title 17,
United States Code, Section 506, which carries a maximum penalty of tive
years of imprisornnent.
Criminal copyright inliingement by electronic means, and aiding and
abetting of criminal copyright inningement, in violation of Title 18, United
States Code, Sections 2 & 2319, and Title 17, United States Code, Section
506, which carries a maximum penalty of live years of imprisonment.
5 See: Constitution Act 1986, s 9C.

[15] Crown counsel and legal advisors to the Police appeared before
Judge McNaughton in the District Cornt at North Shore on 18 January. The Judge
did not have time to deal with the application for the warrants at that time and it was
stood down, the application coming again before the Judge on 19 January 2012. At
that time, Detective Sergeant Nigel McMorr'an sWor'e an affidavit before the Judge
which formed the application for search Warrant, made under ss 43 and 44 of the
MACMA. Those sections provide:
43 Assistance in obtaining article or thing by search and seizure
(1) A foreign country may request the Attorney-General to assist in
obtaining an article or thing by search and seizure.
(2) Where, on receipt of a request made under subsection (1) of this
section by a foreign country, the Attorney-General is satistiedg
(a) That the request relates to a criminal matter in that foreign
country in respect of an oifence punishable by imprisonment
for a term of 2 years or more; and
(b) That there are reasonable grounds for believing that an
article or* thing relevant to the proceedings is located in New
Zealand,-
the Attorney-General may authorise a member of the Police, in
Writing, to apply to a District Court Judge for a search warrant in
accordance with section 44 of this Act.
44 Search warrants
(1) Any District Court Jrrdge who, on an application in writing made on
oath, is satisfied that there are reasonable grounds for believing that
there is in or on any place or thing»~
(a) Any tlring upon or in respect of which any offence under tlre
law of a foreign country punishable by imprisonment for a
term of 2 years or mor'e has been, or is suspected of having
been, committed; or
(b) Any thing which there are r'easonable grounds for believing
will be evidence as to the commission of any such offence;
or
(c) Any thing which there are reasonable grormds for believing
is intended to be used for the purpose of committing any
such offence-~
may issue a search warrant in r'espect of that thing.

(2) An application for a warrant under subsection (l) of this section may
be made only by a member of the Police authorised under
section 43(2) of this Act.
[16] The application repeated much of the material in the United States Central
Authority’s letter of request, but no mention was made in the body of Detective
Sergeant McMo1ran’s afhdavit that the seized items were to be sent to the FBI in the
United States. The letter of request referring to that fact was, however, attached as
an exhibit to the afiidavit. The memorandum filed in support of the application for
the warrants did not address the issue of what was to be done with the items seized.
For reasons not explained in the affidavits filed in this proceeding, warrants were
sought only in respect of the suspected breach of copyright and money laundering
offending, and were not sought in respect of conspiracy to commit copyright
inhingement, conspiracy to commit racketeering or conspiracy to money launder.
[17] Warrants were issued in respect of the three addresses for which the request
was made. The warrants authorised search and seizure of items pursuant to
s 44(1)(a) and (b), but not s 44(1)(c).
[18] Each warrant was issued in the following form:6
To: Every Constable
(or to , constable)
I am satisiied on an application
(in writing made on oath/affirmation)
THAT there is reasonable ground for believing that there is (are) in any
building, aircraft, carriage, vehicle, box, receptacle, premises or place
situated at [the address], the following thing(s), namely:
As per Appendix “A”
6 With minor immaterial variations.

(upon or in respect of \vhich an olfence of Breach of Copy Right and Money
Laundering has been or is suspected of having been committed)
(or which there is reasonable ground to believe will be evidence as to the
commission of an offence of Breach of Copy Right and Money Laundering)
THIS IS TO AUTHORISE YOU at any time or times \vithin 14 days from
the date of this warrant to enter and search the said building, aircraii,
carriage, vehicle, box, receptacle, premises or place situated at [address],
\vith such assistants as may be necessary, and if necessary to use force for
making entry, whether by breaking open doors or otherwise, and also to
break open the box (receptacle) (any box or receptacle therein or thereon) by
force if necessary; and also to seize:
(any thing upon or in respect of which the otfence has been or is
suspected of having been committed)
(or any thing \vhich there is reasonable ground to believe \vill be
evidence as to the commission ofthe offence)
DATED at Auckland this l9"‘ day of J anuaiy 20l2.
Appendix A attached to each of the warrants read as follows:
All evidence, fruits, and instiumentalities of the crimes being investigated
including, but not limited to, the follo\ving:
0 Indicia of occupancy or residence in, and/or o\vnership of the
P1`0P°11Y§
I All documents and things in \vhatever form relating to the
reproduction and distribution of copyrighted \vorks, including, but
not limited to, motion pictures, televisio11 programs, musical
recordings, electronic books, images, video games, and other
computer software;
0 All records and things in \vhatever form, including communications,
relating to the activities of tl1e Mega Conspiracy, including, but not
limited to, Megaupload, Megavideo, and Megastuff Limited;
0 All bank records, deposit slips, \vithdra\val slips, cheques, money
orders, \vire transfer records, invoices, purchase orders, ledgers, and
receipts;
° All documents that reference shipments, imports, exports, customs
or seizures;
0 All digital devices, including electronic devices capable of storing
and/or processing data in digital form, including, but not limited to;

o Central processing units;
o Rack-mounted, desktop, laptop, or notebook computers;
o Web sewers;
o Personal digital assistants;
o Wireless communication devices, such as telephone paging
devices;
o Beepers;
o Mobile telephones;
o Peripheral input/output devices, such as keyboards, printers,
scanners, plotters, monitors, and drives intended for
removable media;
o Related communication devices, such as modems, routers,
cables, and connections;
o Storage media, including external hard drives, universal
serial bus (“USB”) drives, and compact discs;
o Security devices.
Execution of warrants and items seized
[20] The warrants were executed on 20 January 2012. In an afhdavit filed in this
proceeding the officer' in charge of the operation, Detective Inspector Grant
Wormald, describes how all police involved in the search received briefings as to the
nature of the case before that search. The briefings included what was evidence and
what was likely to contain evidence relevant to the proceedings in the United States.
The additional staff called upon to assist were also fully briefed, either in the days
leading up to or on the morning of the execution ofthe search warrant.
[21] Once on site Detective Inspector Wormald relied on the expertise of the
Police Electronic Crime Labo1'atory (“ECL”) staff to determine which items would
be required and were relevant in terms of the search warrant. He said that Police
protocol for dealing with electronic items dictates that electronic items seized under
warrant are not to be examined by the searchers because of the risk the data will be
lost or altered and the integrity of the exhibit thereby harmed. The protocol
necessitates that items specified in the warrant, in this case essentially all of the data

storage devices, had to be seized so the content could be f`orensically examined
offsite, under f`orensically sound conditions and by appropriately qualified stai.
[22] He describes the approach when seizing items. Documentary items were
primarily seized at the scene on the basis they might contain relevant information for
the investigators and therefore evidence. He continues:
Similarly to computers and electronic storage devices it is all but impossible
to interrogate the significance of a document at a scene with certainty, thus
in practice those deemed to be covered by the search warrant are seized for
closer inspection by those investigators able to make the final determination.
[23] Detective Inspector Wormald said that although the Police were able to
decide what documents and digital storage devices should be seized on the basis that
they might contain relevant information for the United States investigators, the
Police had and have no request from the Central Authority to proceed to assess those
things f`or relevance. In this case, the assessment for relevance will have to be done
by the United States authorities, as they are the investigators. The Police are not in a
position to undertake that assessment. It was also his understanding and instruction
in planning the operation, that the Atto1ney~General would direct that the items
seized pursuant to the warr'ants would immediately be sent to the United States to be
forensically processed and examined there. The digital items were not to be
examined in New Zealand.
[24] Detective Inspector Wormald was awar'e that Mr Dotcom employed several
domestic stai, some of` whorn lived on either of` his two properties. He was aware
that the applications f`or the warrants did not set out proposed conditions as to how to
deal with the property of third parties or other irrelevant items, but he believed there
was no requirement that they do so. In his experience no search warrant application
made domestically (save for a search warrant to be executed in a lawyer’s office)
would set out any such conditions.
[25] In an affidavit filed in this proceeding Mr Allan Langille, the Supervisor of
Digital Forensics at ECL confirms that ECL has not analysed any of` the devices. He
is however, able to estimate that 150 terabytes of data has been seized. It is common
ground that a large number of digital storage devices and a very large volume of data

has been seized. Mr' Langille says that the ECL does not have the capacity to
undertake the imaging, storage and analysis of the amount of data seized during the
investigation without expending a considerable amount of money to employ stati,
purchase analysis equipment and for storage ofthe forensic images.
[26] Mr Thomas Song, Deputy Director of the United States Department of
Justice, Criminal Division Cybercrime Laboratories has also filed an aitidavit in
which he says that he has been told by FBI agents that some of the digital storage
devices contain encrypted drives or volumes. The plaintiffs have not provided the
passwords to enable that material to be easily accessed. He says that it is essential
that the Department of Justice’s Cybercrime laboratory maintain custody and control
ofthe original digital evidence to preserve its integrity. This will avoid the necessity
for a technical expert hom New Zealand to travel to the United States to testify at
trial. He continues:
lu addition, this is necessary, in part, because by the time the criminal matter
goes to trial, new issues may lrave arisen, often due to arguments raised by
the defence, which would require searching the electronics with diierent
keywords and topics.
UD Judicial review of search warrants issued under the IIIACIIIA
[27] Since Entick v Carrington7 the Courts have been prepared to review the issue
and execution of warrants where their legality is challenged. The fundamental duty
of the Coruts is to uphold the rule of law. In this context the Court’s role is to ensure
that those who wield the powers of State do so in compliance with the law.
[28] A search warrant authorises a significant invasion of privacy and interference
with the exercise of property rights. Section 2l of the New Zealand Bill of Rights
Act 1990 provides:
Everyone has the right to be secure against unreasonable search or seizure,
whether ofthe person, property; or correspondence or otherwise.
7 Enfiek v Cmwingron (1765) 19 sr Tr 1029.

lntrusions upon the privacy and property rights of individuals must have a proper'
legal basis. A search warrant is a document evidencing judicial authority to search,
For this reason the Courts have insisted that warrants be drawn so as to make clear
the precise parameters of the authority to intrude upon those rights. Thus in Tranz
Rail Ltd v Millington District Court the Court of Appeal saidzs
For centuries the law has set its face against general warrants and held them
to be invalid. Entry onto or into premises pursuant to an invalid warrant is
unlawful and a trespass: Leach v Money (1765) 19 State Tr 1002; Chic
Fashions (West Wales) Ltd v Jones [1968] 2 QB 299; and Auckland Medical
Aid Trust v Taylor [1975] 1 NZLR 728 at p 733 per McCarthy P. A general
wanant in this context is a warrant which does not describe the parameters
of the warrant, either as to subject-matter or location, with enough
specificity.
[29] lt is not every defect in a search warrant that will justify the grant of relief on
judicial r'eview. A Court is unlikely to grant relief where the defect is of a minor or
technical nature. The applicants have to show that the defect is funclamental,9 but
general warrants ar'e fundamentally deficient, If a warrant is invalid then any search
and seizure undertaken in reliance upon it is unauthorised and therefore illegal.
[30] For the first defendant reliance is placed on dicta of the Court of Appeal in
Gill v Attorney-Generallo to support the submission that judicial review is an
exceptional remedy and that the Courts are reluctant to review the legality of the
issue and execution of warrants. This is said to be particularly so when an
investigation into alleged criminal offending is at an early stage, as is the case here,
and particularly where other remedies are available to the subject of the search,
including the ability to have any evidence excluded under s 30 of the Evidence Act
2006.
[31] Mr Pike for the New Zealand Central Authority takes this submission further.
He submits that the current litigation is a collateral attack on the search warrant
process because there is no criminal process in train in New Zealand; the relevant
trial process has commenced in the requesting state with the filing of indictments.
8 7i'anz Rail Ltd v Wellington District Court [2002] 3 NZLR 780 at 793.
9 Gill vAttorney-General [2010] NZCA 468, [2011] l NZLR 433 at [16] ~ [29].
“’ Ibid.

Although he concedes that the New Zealand courts can review the legality of the
warrants and their execution, the purpose ofthe MACMA process and the underlying
international legal principles should inform the approach to that challenge. He
submits that, just as was observed in Gill, where the challenge is based on questions
that in a criminal setting would go to admissibility, the question must be whether
those matters are better and more appropriately resolved by the trial cou1t; in this
case, the trial court of the requesting state,
[32] The point that the purposes of the MACMA regime must be taken into
account when considering its provisions is well made. Underlying the MACMA
regime is the concept of international comity, and also the expectation that assistance
provided by the Police will be reciprocated when required. The international
background to the MACMA is the Harare Scheme (a Commonwealth mutual
assistance regime) and the United Nations Model Treaty on Mutual Assistance in
Criminal Matters (adopted by General Assembly Resolution 45/117 of 14 December
1990). In Solicitor General v Bzjaku the Court of Appeal discussed the implications
of the MACMA as follows:
[25] The MACMA’s enactment to implement the Treaty recalls an
observation in Avowal at [21]:
A regime of obstruction has been replaced by one containing a
large element of cross-border cooperation.
As was stated in A Ltd v Director of the Serious Fraud Ojice HC AK CIV-
2005-404-6833 28 March 2007 at [113]I
Ne\v Zealand accepts responsibility as a member of the
world community to promote and maintain the rule of law
internationally.
The MACMA is to be construed and applied in that light.
[33] The obligations of cross-border co-operation do not of course require a
hands-off approach from the courts, and the MACMA regime only contemplates the
provision of assistance permitted by our domestic laws. It would not be consistent
“ Solicitor General v Bzgak [zoos] NZCA 334.

with the object of promoting the rule of law internationally, were the domestic courts
to refuse to review the lawfulness of warrants obtained under the MACMAregime.
[34] It is also significant that the New Zealand Parliament chose to model the
provisions relating to the issue of search warrants on other domestic statutory
provisions relating to the issue of search warrants including s 198 of the Summary
Proceedings Act 1957. In R v Bzyak the Court of Appeal was addressing different
provisions in the MACMA, but the reasoning in the following passage applies with
equal force in this casezlz
In short, in a general way the New Zealand Parliament elected to give as
much assistance in New Zealand to overseas law enforcement agencies as it
would to New Zealand authorities, but no more, For it would be a rather odd
result if a foreign law enforcement agency could get more by way of pre-
conviction relief here than would be had by a New Zealand agency.
[35] The domestic courts are best placed to determine compliance with domestic
laws, and for these plaintiffs there is no alternative remedy in New Zealand for any
invalidity and illegality involved in the search and seizure process. If having
conducted a review, it is determined that there was a fundamental defect in the
warrant, it is diificult to see why a Court should decline to declare as much, even
where trial processes are engaged in another jurisdiction. The issue of the
engagement of criminal trial process counts, if it counts, at the point of time of
determining what relief should be granted. As to the first defendant’s reliance on
Gill, that case was concerned with very different facts. Judicial observations that
there is something exceptional about the availability of judicial review need to be
viewed within the particular context in which they arise. Where genuine (non
technical) grounds for review are made out, it will be the refusal of relief (even if
only in the form of a declaration) that is the exceptional course, rather than the
reverse.”
'Z R v Bzgnk [2007] NZCA 347 at [47].
U Dwnz Rail Ltd rf Wellington District Courl at [45].

dw Is the ojence adequately described in the warrants?
[36] lt is logical to start with the statutory requirements as to the fonn and content
ofa MACMA warrant. Those particulars are set out in s 45:
45 Form and content of search warrant
(l) Every warrant issued under section 44 of this Act shall be in the
prescribed form.
(2) Every \varrant issued under section 44 of this Act shall be directed to
any member of the Police by name, or to any class of members of
the Police specified in the warrant, or generally to every member of
the Police.
(3) Every warrant issued under section 44 of this Act shall be subject to
such special conditions (if any) as the District Court Judge may
specify in the warrant.
(4) Every warrant issued under section 44 of this Act shall contain the
following particulars:
(a) Tl1e place or thing tl1at may be searched pursuant to the
warrant:
(b) The offence or offences in respect of which the warrant is
issued:
(c) A description of the articles or things that are authorised to
be seized:
(d) The period durin which tl1e warrant may be executed, being
a period not exceeding l4 days from the date of issue:
(e) Any conditions specified by the Judge pursuant to
subsection (3) of this section.
[37] The prescribed fonn referred to is form 5 in the Schedule to the Mutual
Assistance in Criminal Matters Regulations 1993. It requires that the country under
whose laws the offence is alleged to have been committed be stipulated.
[38] As s 45(4)(b) provides, any warrant issued must relate to the particular
offence or offences in respect of which it was sought, When ss 44 and 45 are read
together, it is clear that the authority to sea1'ch and seize confeired by the Warrant
must also be so limited. In the absence of detail limiting the warrant in this way, the

warrant is a general warrant. The MACMA does not authorise the issue of general
warrants, and as previously noted, the law “sets its face against thenr.”14
[39] Here, the critical detail in the warrants related to the allegation of breach of
copyright oifending. It is common ground that the money laundering oifence alleged
was contingent upon the breach of copyright, and flowed from it. Without proper
definition as to the primary offence, there could be little definition as to what was
relevant to that secondary offence of money laundering.
[40] As is properly conceded by Mr Rufhn for the Police, there are deficiencies in
the description of the offences in this case. The warrants do not stipulate that the
offences of breach of copyright and money laundering are offences under the law of
the United States of America, nor that they are punishable by a sentence of
imprisonment of two years or more. They do not refer to any statutory provision to
enable the subject of the warrant to understand the nature of the offences referred to.
The failure to refer to the laws of the United States on the face of the warrants,
would no doubt have caused confusion to the subjects of the searches. They would
likely read the warrants as authorising a search for evidence of offences as defined
by New Zealand’s law. The only clue that they are not is that each warrant is headed
“The Mutual Assistance in Criminal Matters Act l992”. That is not much of a clue.
[41] Mr Davison does not argue that these deficiencies on their own render the
warrants invalid, but rather that they contribute to the lack of precision infecting the
entirety of the warrants. He says that in describing the offence simply as breach of
copyright, without stipulating the country in which the offence was alleged to have
been committed, or the nature of the alleged breach of copyright, the warrant
provided inadequate definition of the oifence. A necessary consequence of that was
that it also provided inadequate definition of what could be searched for. Copyright
can exist in many things. A breach of copyright can be effected in many ways.
These were general warrants both in form and reality.
N 7i'anz Rail Ltd v Fkllingfon District Court at [3 8], above rr 7.

[42] ln Auckland Medical Aid Trust v Taylorgls a warrant was classified as general
where it stipulated the offence as “abortion” rather than specifying a particular
instance of illegal termination ofpregnancy.16 McCarthy P said:17
If then a warrant can only be issued following information relating to a
particular offence and in respect of that offence, one would expect to see in
the warrant particulars which indicate the olfence with sufiicient
paiticularity at least to enable the otiicer executing it and the person in
respect of whose premises it is issued to know what the offence is.
[43] Alter discussing the inadequacy of the description of the offence, McCarthy P
went on to say of the applicant police oliicerzlg
what he wanted and what he thought he got, was a general warrant to
search for evidence of any of the offences covered by ss 182 to 186 of the
Crimes Act. In my view, it would be contrary to the 1'ole which the Courts of
our tradition have always adopted of protecting the integrity of a man's
premises and of viewing in a conservative way the extension of statutory
powers to interfere with privacy, if we were to uphold the wairant in this
case.
[44] The warrant must be framed with as much speciticity as the relevant context
permits.” Detail of the specitic offence is important because it is a requirement of
the statutory scheme, It is a requirement of the statutory scheme because it det`mes
the extent of the authority to search and seize. It informs the person or persons
searching of the parameters of the Police’s authority to search and seize goods. It
also provides the subject of the search with enough information to enable the subject
to obtain legal advice about the permitted limits of that search. For this reason s 47
of the MACMA requires that the police oiiicer executing the warrant issued under
s 44 have the warrant with him or her, and produce it on initial entry and at any
subsequent time.
15 Auckland Medical Aid Dust v Taylor and Ors [1975] 1 NZLR 728,
A point taken on appeal was that there was no such offence as “abortion”, the type of offence
referred to was “procuring an abortion”. However the Court said that a misdescription of that
type in the warrant, provided it would not mislead anyone, was a defect or irregularity of form
\vhich did not invalidate the warrant, A much more fundamental error was the failure to stipulate
the particular offence or offences rather than simply the type of offence.
17 At 736.
‘“ At 737.
W A Firm of Solicitors v Disirict Court ntAuckIn/7d [2006] 1 NZLR 586 (CA) at [75].
I6

[45] l agree with the plaintiffs that the words “breach of copyright” do not comply
with the requirements of the Act or those of the regulations. They describe the type
of offence, and then do so inaccurately. They provide no detail as to the particular
offence or offences. The requirement imposed by s 45 is not to describe the type of
offence, but rather the offence or offences in respect of which the warrant was sought
and obtained.
[46] Copyright may be breached in a multiplicity of ways, and a breach of
copyright may involve a multiplicity of media. The warrant authorised the Police to
search for any offence of breach of copyright. Because warrants should be constiued
as a whole, I have considered what other material there is that might assist in
defining the o1Tence.2° Although close inspection of Appendix A reveals clues that
the suspected breach or breaches of copyright involved the use of electronic media,
that was neither a necessary nor obvious conclusion. Particularly since there were
contraindications in the list such as the item “All documents that reference
shipments, imports, exports, customs or seizures”. ln any case the subject of the
warrant should not be left to attempt to guess the purposes of the warrant through
deductive reasoning. lt should be spelt out plainly in the required part. And to say a
breach of copyright involves the use of electronic media scarcely limits the field.
[47] There is evidence in this case that greater specificity was immediately to
hand in relation to the suspected breached of copyright and could have been
provided. The terrns of the authorisation to apply for sea1'ch warrant addressed to
Detective Sergeant McMorran described the breach of copyright offending in the
following way:
Criminal copyright infringement by distributing a work on a computer
network, and aiding and abetting of criminal copyright infringement, in
violation of Title 18, United States Code, Sections 2 and 2319, and Title l7,
United States Code, Section 506, which carries a maximum penalty of five
years of imprisonment.
Criminal copyright infringement by electronic means, and aiding and
abetting of criminal copyright infringement, in violation of Title 18, United
2° Rural Timber Ltdv Hughes [1989] 3 NZLR 178; R v Sanders [I994] 3 NZLR 450, 454.

States Code, Sections 2 and 2319, and Title 17, United States Code, Section
506, which carries a maximum penalty of tive years of imprisonment.
[48] I am inclined to think that even that level of detail fell short of what could
and should have been provided, lacking as it did reference to the involvement of the
Megaupload business in the alleged offending. There is reference to the “mega-
conspiracy” in the appendix, but because there is no description or definition of what
that was, the reference adds to, rather than removes the confusion.
[49] To conclude on this point, the warrants did not adequately describe the
offences to which they related. Indeed they fell well short of that. They were
general warrants, and as such, are invalid.
[50] Before I leave this topic, there is one further peculiarity about the form in
which the warrants were sought and issued which I record: the applications did not
extend to racketeering, or to conspiracy to commit copyright infringement. It
included money laundering rather than conspiracy to commit money laundering.
The Police were authorised to apply for a warrant in relation to the five listed
offences and Appendix A list was linked by the United States Central Authority to
those offences. It is perhaps understandable why an application was not made in
respect of “racketeering” as the evidence would likely be the same as for the other
offences, and there may have been a concern that racketeering is an offence
unfamiliar to a New Zealand Judge. But the allegation of conspir'acy brought in to
the mix inchoate offending, which the allegation of breach of copyright and money
laundering did not. Appendix A was clearly framed in light of that additional level
of offending, referring as it does to evidence of the mega-conspiracy. However,
since this aspect of the application and warrant was not explored in argument, and
was in any event not likely to be determinative, I put it to one side for the purposes
of this judgment.
(iv) Was there adequate definition of the authority to search and seize?
[51] As outlined above, the adequacy of the definition of the scope of the search is
not capable of separation from the issue of specificity as to the definition of the
offence. If there is inadequate specificity as to the offending to which the warrant

relates, it is likely that there is inadequate specificity as to the extent of the authority
bestowed by it to search and seize items. Nevertheless, there a1'e some particular
points raised by the plaintiffs that relate to Appendix A that need to be addressed
separately.
[52] The plaintiffs note that the warrant commences with the statement that the
issuing judicial officer is satisfied that there are reasonable grounds for believing that
the items listed in Appendix A in effect, fall within either s 44(l)(a) or (b). They
argue that the warrant therefore authorised the seizure of the Appendix A items and
that the categories in Appendix A were so broadly drawn that it was inevitable that
the Police would seize irrelevant documents and irrelevant digital files, the latter
stored within the hard drives of the digital devices.
[53] For the defendant, Mr Ruffin says that the categories stipulated in Appendix
A are limited by the fact that the warrant only authorised the seizure of “anything
upon or in respect of which the offence has been or is suspected of having been
committed (or anything which there is reasonable ground to believe will be evidence
as to the commission of the offence)”.
[54] Again, the starting point is the MACMA. The warrants could only lawfully
authorise seizure of items to the extent allowed under the MACMA. Section 46
describes the powers conferred by the warrant, and s 46(l)(d) provides that subject
to any special conditions specified in the warrant, every warrant issued under s 44
authorises the Police to search for and seize anything referred to in s 44(l).
[55] I accept the plaintiffs’ submission that even when each of the wairants is
construed as a whole, their form is such that they would most likely be read as
authorising the seizure of all of the items in Appendix A. This is because the issuing
Judge has expressed himself as satisfied that “all” of the items within the second to
sixth listed bullet points in the appendix fall within s 44(l)(a) or (b).
[56] The issuing judge could not have been satisfied that there were reasonable
grounds for suspecting that all of the things listed in Appendix A we1'e evidence of
breach of copyright or the related money laundering, when those categories were so

broadly drawn. For example, had he turned his mind to it, he would have identified
that the digital devices listed in Appendix A would most likely store some irrelevant
material, probably a large volume of irrelevant material, since the walrants were to
be executed at domestic properties. He might also have identified the real possibility
that not all of the accounting material or shipping documents would be relevant.
[57] Mr Davison makes an additional point in relation to the following item in
Appendix A:
All records and things in whatever form, including communications, relating
to the activities of the Mega Conspiracy, including but not limited to,
Megaupload, Megavideo and MegastuffLimited.
[58] He submits that because of the inclusion of the expression “Mega
Conspiracy” in this item, its meaning is obscure. I accept his submission that
without definition of the “Mega Conspiracy” it is hard to imagine what falls within
this category.
[59] Mr Ruffin would have been on stronger ground with his arguments if
Appendix A had simply listed categories coherently described within which items of
evidence might exist. That would have clearly cast the onus upon the Police to
undertake the sorting and sifting exercise that would be expected. Appendix A is
not, however, drafted in that way.
[60] I have reflected upon whether this is an overly technical construction of the
warrants. I do not think that it is, and indeed the evidence suggests that the Police
sought warrants that authorised the seizure of entire categories of items because of
the methodology they had settled upon for complying with the request for assistance.
It is clear from the evidence of Detective Inspector Wormald that it was the intention
of the Police to seek warrants that authorised the seizure of anything that might
possibly be relevant, in the knowledge that irrelevant material would be caught up in
the net that was cast. As Detective Inspector Wormald explained, the Police needed
to seize such broad categories of items because the Police were not able _to assess
relevance, and indeed had no request to do so. That would have to be done by the
FBI and the FBI would do that offshore. Seizing the categories of items was the
assistance which the Police were requested to provide.

[61] The Police clearly believed that they had obtained a warrant that authorised
this approach, and one can understand the operational imperatives that drove this,
given the need to leave the ultimate determination of relevance to the FBI. There
wer'e ways around this however, and operational difficulties cannot expand the scope
of the authority it was possible to confer on the Police under ss 44, 45 and 46 of the
MACMA.
[62] It is also argued that the seizure of all digital devices was authorised because
they were devices on which the offence had been committed. Special Agent Poston
refers to the significance of electronic fingerprints on the electronic devices. That
could justify retention of the hardware involved in a digital storage device but not
the irrelevant digital information contained on it. These digital devices were to be
taken from residential properties. ln this day and age computers (and even phones)
are used by individuals and families to store a wide range of material and
information, family photos and films; personal correspondence (emails) and
generally information of a private and purely personal nature.
[63] lt is true, as Detective 1nspectorWormald identifies, that a practice has grown
up of police taking away fiom a search site material for the purposes of undertaking
a sorting exercise offsite to separate the relevant from the irrelevant, and, given that
approach, it is inevitable that some irrelevant material will be taken from the search
site. The practice that Detective 1nspectorWormald describes has been the subject of
judicial consideration in the past. A review of the cases reveals, as one would
expect, that this is a practice which has parameters.
[64] ln A Firm of Solicitors v District Court at Aucklandzl the Court of Appeal
addressed two conflicting English authorities which dealt with the extent of the
authority of police officers to take from a search site material for the purpose of
offsite sorting of relevant from the irrelevant. In Reynolds v Commissioner of Police
ofthe Metropolis" the English Court of Appeal held that a warrant issued under the
Forgery Act 1913 GJK) could not authorise the police ofiicer executing it to
21 A Firm of Solicitors v District Court atAzlcklr1nd [2006] 1 NZLR 586.
22 Reynolds v Commissioner of Police ofthe Metropolis [1985] QB 88l, [1984] 3 All ER 649 (CA).

indiscriminately remove from premises every book, file, bundle or document he
could lay his hands on, even for the purpose of temporary sorting. Removing
material, even for the purpose of sifting offsite, was a seizure. But the officer
executing the warrant was entitled to remove from premises files, books, bundles or
documents which, at the time of removal, he reasonably believed contained forged
material or material which might otherwise be of evidential value. lf that occun'ed,
any subsequent sorting process had to be carried out expeditiously, with non-
evidential material being returned promptly.
[65] The conflicting authority the Court of Appeal considered is R v Cheslerfield
_/izstices, ex p Bramley.23 In that case, Kennedy LJ limited the application of the
principles enunciated in Reynolds to the specific legislation. He accepted the
approach described in Reynolds was a common~sense answer to the situation faced
by an officer executing a warrant, when dealing with a large volume of material.
However, the practice of offsite sorting could not be authorised by a statutory
provision which permits the person executing the warrant to seize only items which
he or she reasonably believes are evidence in relation to an offence under
investigation. Where seizure involves items which do not fit within those categories,
unless the consent of the owner of the premises is obtained, the person executing the
warrant would have no defence to an action for trespass to goods based on
unjustified seizLu'e of the material.
[66] ln A Firm of Solicitors one ofthe issues for the New Zealand Court of Appeal
was whether Serious Fraud Officers were justified in removing computer drives from
a law office, cloning them for the purpose of offsite sorting of relevant material from
inelevant and then returning the originals. The clones were sealed by an independent
computer' expert pending r'esolution of privilege claims. The Court of Appeal said:
[95] While Reynolds and Bramley dealt with different statutory
provisions, we do not find the reason given in Bramley for distinguishing
Reynolds particularly convincing. To the extent that the existence of a “quick
and effective remedy” may be relevant, it could be argued that, at least in so
far as privilege is concerned, there is a quick procedure in the SFO Act in s
24(5) forthe resolution of disputes relating to privilege, which could be seen
13 R v ChesteljfieIdJz1stices, exp Bramley [2000] QB 576; at 588.

as having some features in common with that applying under the Forgery
Act which applied in the Reynolds case. However, s 24(5) does not deal with
the problem \vhich would arise \vhere the material seized includes irrelevant
material.
[96] If the approach taken by the majority in Bramley were followed in
this case, it could be argued that an SFO olticer executing a search \varrant
issued under s 12 could never remove from the searched premises a
computer hard drive containing data other than data which \vas relevant to
the investigation, or privileged material. Nor would cloning of such a
computer hard drive on site, followed by removal of the clone, ever be
permitted. We do not consider that to be the law in Ne\v Zealand, at least in
the context of the SFO Act. We did not hear argument about the position
applying to searches made under other New Zealand statutes and express no
view on those other statutory provisions.
[97] To the extent that the judgment of the majority in Bramley and the
judgment of Slade L] in Reynolds conflict, we prefer tlre latter. The approach
suggested by Slade LJ in Reynolds represents a reasonable balance between
the competing interests of respect for privacy rights and effective la\v
enforcement in cases involving large amounts of documentary material or
computer data.
[67] Mr Ruiiin submits that cases such as A Firm of Solicitors should be limited to
their particular facts, and submits it is significant that they were cases concerned
with the protection of legal privilege. I do not consider the principles described there
should be so limited in their application. Ultimately what was at issue in that case,
and what is at issue here, is the scope of statutory authority to search and seize. The
Court in A Firm of Solicitors expressly addressed itself to the issue of non-privileged
but irrelevant material in [95], because the statute under' investigation provided the
statutory scheme to deal with privileged material. I also note that Reynolds, the
reasoning of which was adopted by the Court of Appeal, was a case concerned with a
search of the plaintiff ’s home.
[68] Assuming then that the Police were operating under a valid warrant, what
were the Police entitled to do in this case? They were required to conduct a
preliminary sorting exercise at the premises, as the warrants could not authorise an
officer' to removed from the premises indiscriminately all documents and records. In
this case the Police faced the additional difhculty that they were not the investigating
officers and had limited knowledge of the operation. Although this is not a point
taken by the plaintiffs (and therefore is not a point which I attach Weight to in this
judgment) the Police would have had limited ability to do this sorting. Given the

state of knowledge of the Police, it would have been a proper approach for them to
involve officers from the FBI in this exercise. Section 46(1) authorises the use by
police of “such assistants as may be reasonable in the circumstances for the purpose
of the entry and sea1'ch”. Because the assistants would have been foreign law
enforcement oflicials it may have been prudent to have them as named assistants in
the warrants authorising the search.
[69] Providing the Police act reasonably in so doing, following the initial sorting
exercise, they were then entitled to remove from the premises those things which at
the time they reasonably believed contained material which might be of evidential
value. This included the digital storage devices enclosed within computers and other
electronic devices. Any necessary offsite sorting process in relation to those items
removed should then have been carried out promptly and those items which were not
found to fall within either of the two categories identified in the warrant should then
have been returned promptly to the owner.
[70] The ability to search computer hard drives onsite is of course limited, given
the need to preserve the integrity of the contents through the search process. It
would have been reasonable for the Police to take the hard drives oifsite and clone
them, Either the original or the cloned hard drive should then have been returned to
the owner (depending upon whether there was any evidential value in the hard drive
for which the clone is not an adequate substitute).24 This approach was necessary
because there was no legal basis upon which the Police were entitled to retain
material which did not fall within the two categories in s 44(l). It would have been
necessary to have the assistance of the FBI in this exercise.
[71] As to what could be retained following this process, the word “evidence” in
ss 44 and 46 must be considered, in context, to have a wider meaning than its usual
meaning when used in court proceedings. Its meaning in comparable provisions in
the equivalent United Kingdom legislation (the Criminal Justice (International Co-
” This would of course also be subject to the proviso that material which would enable further
offending should not be returned. This might be the case in relation to unlawful material which
is found on the hard drive.

operation act 1990) was discussed by the English Court of Appeal in Regina v
Secretary of Slate for the Home Deparlment and Others Ex Parte Fininvesl Sp./1
and Others, as follows:25
When, therefore, one is speaking of ‘evidence’ in the context of a criminal
investigation, the pe1'missible areas of search must inevitably be wider than
once that investigation is complete and the prosecution’s concern is rather to
prove an already investigated and “instituted offence”.
[72] I would add to that, to fall within s 44(l)(a) or (b) the item must at least be
relevant to the investigation. If not that, then there is no meaningful limit to what
can be seized. This construction is consistent with the fact that the trigger for the
authorisation for a search warrant under s 43 is the Attomey-General’s satisfaction
that there are reasonable grounds for believing that an article or thing relevant to the
foreign country’s criminal proceeding is located in New Zealand.
[73] The Ex Parte Fininvest case is an example of the type of approach that could
have been employed by the Police in this case to both meet the operational
difficulties they faced and comply with the domestic statutory framework. In
Fininvest the applicants for judicial review were alleged by Italian authorities to be
involved in a very large scale fraud. A request for assistance was received from the
Italians, sent under the provisions of the United Kingdom Criminal Justice
(International Co-operation) Act 1990. The request was that a search be undertaken
for specified documents. A search warrant was duly obtained. Named Italian
investigators were permitted to accompany any police constable executing the
warrant so they could advise whether documents fell within the terms of the warrant.
Documents were removed from the search site and examined, in the United
Kingdom, by the Italian authorities to determine which were relevant and which
were required for transmission to Italy. Some were returned to the applicants. Some
wer'e sent to the Home Secretary. None were transmitted to Italy pending the hearing
of the application for judicial review.
25 Regina v Secretary of State for the Home Deparlment and Others Ex Parte F ininvart Sp.A and
Others [l 997] l WLR 743 at 752.

[74] One of the grounds of judicial review in the proceeding was that the warrant
was impermissibly wide, and amounted to a fishing expedition. In finding the
warrant valid Simon Brown LJ said:26
In short, the request for assistance here is not, as the applicants contend,
vague and speculative; rather it is as precise and focused as such a request
could sensibly be in these circumstances. It is impossible to know just what
documents are both in London and relevant. To discover that, it is necessary
to find, examine and appraise them. Given, however, that these are the type
of documents invariably germane to any major company baud investigation,
it is highly likely that many will be relevant. And in so far as any of the
documents seized prove not to be, they will not be transmitted to Italy.
[75] The Police here could have had the assistance of the FBI in the initial
execution of the warrants. In any event they should have moved promptly through
the offsite process permissible when dealing with large quantities of material. The
purpose of that sorting is to extract the relevant from the irrelevant, and it seems to
me inevitable that the FBI should have been able to assist with that.
[76] Under the provisions of MACMA the United States Central Authority is not
entitled to irrelevant material seized during the search. Although Mr Song says the
FBI wishes to keep all material against the possibility that some new issues will
emerge, issues of relevance must be determined at the time of the search and offsite
sorting process. There is no construction of s 46 which would permit the seizure of
material which is irrelevant at the time of search against the possibility it
subsequently becomes relevant.
[77] To conclude, the warrants were expressed to authorise the search for and
seizure of very broad categories of items. These categories of items were defined in
such a way that they would inevitably capture both relevant and irrelevant material,
The Police acted on this authorisation. The warrants could not authorise seizure of
irrelevant material, and are therefore invalid.
2° At 753,

(v) Should conditions have been inqmsed?
[78] Mr Davison argued that the warrants should have contained conditions to
deal with the issue of irrelevant material. Mr Ruffin argues that it is only in
situations involving significant issues of legal privilege that conditions should be
imposed. He refers to Gill as supporting the proposition that conditions should not
readily be attached to warrants.
[79] I do not consider that Gill stands as authority for the proposition that Courts
should be reluctant to impose conditions on warrants. The passage in Gill which
Mr Ruffin relies upon is one in which the Court of Appeal refers with approval to an
earlier decision of that Court in Television New Zealand Lia' v Attorney General.” In
Television New Zealand the Court of Appeal expressed the need for care in
expressing principles applicable to Warrants so as not to constrain the necessary
discretion of the issuing Judge. In the course of reviewing the issue of the warrant,
the first instance Judge had attempted to formulate detailed guidelines for the issue
of warrants in relation to media organisations, including a set of standard conditions.
On appeal, the Court emphasised that cases vary greatly and that it was inappropriate
to go further than identifying general principles to be borne in mind when the
reasonableness of granting or executing a Warrant was under consideration. The
comment relating to the imposition of conditions set out in Gill was in response to
the suggestion that warrants in connection with media organisations should have, as
a matter of course, special conditions attaching. The Court Went no further than
saying that conditions may be imposed but that they will not be the norm.
[80] Section 45(3) contemplates that special conditions may be imposed in
relation to MACMA warrants. It creates a discretion that is to be exercised in the
particular circumstances of the case.
[81] In this case I acknowledge that it is a rather academic exercise to consider
Whether conditions should have been imposed, given the finding that the warrants
27 Television New Zealand Limited v A ff0l'I1€y-G€l1€l'(1l [l995] 2 NZLR 641 (CA).

were invalid. But since the issue may be relevant to the grant of relief, I will address
it. If the warrants had been adequately specific as to offence and scope of authorised
search, it may have been appropriate to impose conditions because those conditions
could have addr'essed just how the offsite sorting exercise was to be undertaken. In
considering whether to impose conditions it was relevant for the Judge in this case to
weigh the inevitability of an offsite sorting exercise, the likely size of that exercise,
and the requirements for cloning the content of the digital storage devices. It was
also relevant that there was no information provided in the warrant applications as to
when or where the sorting exercise was to take place, or who was to do it. Finally, it
was relevant that there was information available to the Judge (although this
information was not prominent in the material presented in support of the
application) that the Police intended to deliver the items seized to the FBI in the
United States.
[82] To achieve an appropriate balance between the investigative needs of the FBI
and the right of the plaintiffs to be free from unreasonable search and seizure of their
property and correspondence, it may well have been appropriate to impose
conditions. The failure to do so meant that the subjects of the warrants were leff
unsure of their rights in relation to the material taken offsite, and also risked
irrelevant material being released to the FBI, beyond the jurisdiction of the New
Zealand Courts to order its return.
[83] As to the nature of appropriate conditions, in A Firm of Solicitors, a case
involving as its name suggests, the search of a firm of solicitors, the Court of Appeal
saidzzs
conditions attaching to Anton Piller orders made in the civil jurisdiction
of the High Court may provide some guidance, though there would
obviously need to be adaptations to suit the circumstances of the case. It
would be necessary to ensure that the cloning exercise, and the subsequent
extraction of evidential material, was undertaken by an appropriately
qualified and independent expert. It may be that the process should be
supervised by the issuing Judge or a person appointed by the issuing Judge
for the purpose.
it At [rosy

[84] In this case, however, there is no evidence of significant volumes of
privileged material and any conditions needed to reflect the concerns they were
intended to address, In any search privileged material may fall within the net. But
when a search of a legal ofHce is contemplated, it is a concern that should be at front
of mind for the Police and the issuing officer. There is considerable expense
involved in some of the procedures contemplated by the Anton Piller procedures. I
consider that a less onerous set of conditions would have been appropriate where
privileged material was not of particular concern. The conditions should have
provided for the cloning exercise and extraction of relevant material, what was to be
done with irrelevant material, and whether the plaintiffs were to have returned to
them the original hard drives retlurred, or clones.
[85] As is plain from my earlier comments I also do not consider that the
conditions needed to keep from the FBI the content of the hard drives. Indeed, to
enable the MACMA regime to achieve its purposes, it seems inevitable that in
complex cases the investigating authorities must be engaged in the sorting exercise,
which proper execution of the warrant requires.
[86] To conclude on this issue, if the warrants had been adequately specific as to
offence and scope of search, it may still have been appropriate for the issuing Judge
to impose conditions to address the offsite sorting process that was inevitable in this
case. The conditions could have provided for the cloning of hard drives, the
extraction of relevant material and the return to the plaintiffs of the original hard
drives, or their clones.
B. Did the Police seize items outside the scope of the search warrant?
[87] I have held that the warrants were invalid because they were general warrants
lacking adequate specificity as to the offence and to the scope of the items to be
searched for. Moreover, the warrant authorised the seizure of items falling outside
the parameters of s 44(1), Search and seizure pursuant to an invalid warrant involves
the Police in a trespass and unauthorised seizure of property.

[88] If I am wrong that the warrants were invalid, then it is nevertheless clear that
the Police, in executing the warrants, have exceeded what they could lawfully be
authorised to do. This is because they continue to hold, along with the relevant,
material they concede will be irrelevant. They have taken few steps to identify that
material, and no steps where the material resides on the computer hard drives. The
Police say they have no intention of sorting the evidence or potential evidence, from
the irrelevant. They intend to allow the FBI to do that in the United States. That is
an app1'oach that is not available to them. Section 46 of the MACMA only
authorises seizure of items referred to in s 44(1), and it is only things seized under
s 44(1) that are amenable to a s 49(2) direction that the items be sent to a foreign
investigating authority.
[89] No one addressed the issue of whether the Police conduct also amounted to
an unreasonable sea1'ch and seizure. My preliminary view is that it did, but as I have
not heard counsel on this, I make no finding at this point. If the issue requires to be
dealt with, it can be dealt with when I hear the parties in relation to relief.
C. Was the provision by the Police of copies of digital files to the FBI
unlawful?
[90] During the course of the first hearing of this application for review, it
emerged that hard drives had been imaged and shipped by the FBI to the United
States. The plaintiffs say the shipment of those images was unlawful because it was
contrary to the Solicitor-General’s direction given under s 49(2) on 16 February 2012
that any items seized were to remain in the custody and control of the Commissioner
of Police until further direction.
[91] Section 49 ofthe MACMA provides:
49 Custody and disposal of things seized
(l) VVhere any member of the Police seizes any thing pursuant to a
warrant issued under section 44 of this Act, that member of the Police
shall deliver the thing into the custody ofthe Commissioner of Police.
(2) Where a thing is delivered into the custody of the Commissioner of
Police under subsection (1) of this section, the Commissioner of
Police shall arrange for the thing to be kept for a period not exceeding

l month from the day on which the thing was seized pending a
direction in writing from the Attorney-General as to the manner in
which the thing is to be dealt with (which may include a direction that
the thing be sent to an appropriate authority of a foreign country).
(3) Where, before the expiry of the period referred to in subsection (2) of
this section, the Attorney-General gives a direction in respect of the
thing, the thing shall be dealt \vith in accordance with the direction.
(4) Ifno direction is given by the Attorney-General before the expiry of
the period referred to in subsection (2) of this section, the
Commissioner of Police shall arrange for the thing to be returned to
the person from whose possession it was seized as soon as practicable
after that period has expired.
[92] It is common ground that there was no document directing the release of
images, signed by the Attorney-General, the Solicitor'-General or the Solicitor-
General’s delegate, and that, at the time the images were sent to the United States,
the s 49(2) direction which applied was that of 16 February. Mr Pike for the New
Zealand Central Authority argues that s 49(2) is only concerned with physical
custody, and, notwithstanding the provision of copies, as the originals remained in
the physical custody of the Police, no direction under s 49(2) was required to allow
shipment. Alternatively, he argues that any unlawfulness involved was of a technical
nature because the plaintiffs had consented to the release of images to the FBI and, in
any event, the Deputy Solicitor General would have directed the provision of the
images if he had been asked to.
(D Does s 49 regulate physical custonjf of an item only?
[93] Mr Pike’s essential submission for the Central Authority is that neither the
language nor' the context of s 49 support the argument that all dealings with seized
items held by the Commissioner, even those that do not affect legal custody of the
original items seized, must be supported by a s 49 “direction”. Things seized are
kept by the Commissioner pending a written direction. Once a written direction (of
the sort dated 16 February 2012) is issued, the things are no longer' kept pending
direction but rather kept pursuant to the direction issued. That in itself Mr Pike
submits, tells against the construction that access to or other actions relating to the
seized things not affecting their physical custody, or their status as items seized
pursuant to the MACMA, requires a s 49 “dir‘ection”.

[94] An interpretation of s 49 that required a direction to authorise each and every
dealing with an exhibit whilst it is in the custody of the Commissioner of Police
would be inconsistent with the purpose of the MACMA legislation. In executing a
search warrant obtained pursuant to a MACMA request, the Police are likely to have
to allow foreign law enforcement agencies access to items seized. Consequently,
custody is to be given a broad and liberal meaning: if an item seized remains under
the control of the Police, it is within their custody.” Whether a s 49 direction is
required when it is proposed to send to law enforcement agencies overseas an exact
replica of the items is a rather more difficult question. The original physical item
seized remains in the possession of the Police, However, once a clone of a hard
drive is sent offshore, the Police have lost the ability to control what is done with
information stored on that hard drive, The same may also be true of copies of the
documents involved, The wording of the legislation does not address how replicas
(effectively identical twins of the item) fit within this regime.
[95] Fortunately in this case this is not an issue that I have to decide, because a
direction under s 49(2) was made. The Commissioner of Police was directed to keep
the items in his custody and control. Mr Pike suggested the inclusion of the word
“control” in that direction was simply a case of lawyers including a boiler plate type
provision and that it could be disregarded. While the basis upon which it would be
appropriate to ignore the words of the direction is unclear, it seems in any case that
there was some intent behind the particular words used. Ms Madeline Laracy, a
solicitor with Crown Law, has filed an affidavit in opposition to the application for
review dated 25 May 2012. In that affidavit she says there were two reasons why the
Solicitor-General did not direct the items seized be sent offshore immediately. The
first was that the Police and Crown Law, representing the Central Authority, were
concerned to ensur‘e that there was a register which clearly identified every single
item and every document. The second was notification of the proposed filing of
judicial review proceedings by Mr Dotcom to challenge the warrant and prevent the
computer items leaving the country before arrangements had been made which were
satisfactory to preserve the applicant’s ability to access data. lt is apparent Hom the
Z’ Rural Timber Lrd v Hughes [1989] 3 NZLR 178 (CA) at 186,

correspondence on the file that the plaintiffs’ were also concerned from an early
stage that irrelevant items had been seized. Therefore both challenges as to the
legality of the warrants and to the extent of items seized required some resolution
[96] The hard drives seized contain information in the form of digital files. Those
files are part of the relevant hard drive. The information is the property of the
plaintiffs, just as much as the private papers were the property of the plaintiff in
Entick v Carrington. Once clones of the digital files were shipped offshore, the
Police no longer had control over what was done with them. They could not, for
instance, compel their return, nor pr'event the FBI dealing with them as it chose, even
if it was subsequently determined that there was any invalidity affecting the warrant,
or that items outside the scope of s 46(l)(d) had been seized. The direction that the
items remain under the custody and control of the Commissioner during the ‘sorting
out’ period was therefor'e a sensible one. It gave time for some sort of resolution of
the various issues to be worked out with the plaintiffs, or time for those issues to be
determined by the Courts. The failure to observe the direction, by permitting or
allowing the shipments, may have involved an irrevocable seizure of material.
[97] To conclude on this issue, the release of the cloned hard drives to the FBI for
shipping to the United States was contrary to the 16 February direction given under
s 49(2) of the MACMA that the items seized were to remain in the custody and
control of the Commissioner of Police. This dealing with the cloned hard drives was
therefore in breach of s 49(3) of the MACMA.
(iD Did the plaintws consent to images of conqmter lzard drives being shipped
to the FBI 0ff§`]l0l'E?
[98] Extensive affidavit material has been filed in relation to this aspect of the
hearing. Most of that affidavit evidence relates to discussions between Crown
counsel (who were at the time representing the New Zealand Central Authority),
plaintiffs’ counsel and the Police concerning the cloning of the hard drives with a
view to providing those copies to the FBI and to the plaintiffs.

[99] l\/Ir Pike explained in submissions that this affidavit material was produced
because it was understood that allegations of serious misconduct on the part of the
Crown had been raised and that as a consequence the Court had directed the filing of
evidence. I had not however, directed the filing of evidence. During the first phase
of the hearing, in response to a question from me, Mr Ruffin said that images of
computer files had been taken by the FBI and sent to the United States of America.
Both Mr Davison and Mr Foley expressed surprise at that; Mr Davison noting that an
application for interim relief in the present proceedings had been resolved on the
basis that all items continued to be held pursuant to the s 49(2) direction of
16 February. I asked l\/Ir Ruffin for clarification and he sought leave to file affidavits
from those who had been involved at that earlier stage (including counsel and
police). That leave was granted.
[100] At the hearing on 6 June, counsel for the plaintiffs confirmed that, while no
allegation of bad-faith was made, it was contended on the plaintiffs’ behalf that the
transfer of the material offshore had been unlawful, the plaintiffs had not consented
to it, and that the plaintiffs had been misled in these present proceedings. The latter
because the plaintiffs had withdrawn their applications for interim relief on
Mr Ruffin’s assurance that the material seized by Police would continue to be held in
accordance with the s 49(2) direction of 16 February and that the direction preserved
the status quo.
[101] Having reviewed the chronology of events as revealed through the affidavits
of the participants and correspondence in Court documents, three phases in the
dealings between the parties emerge. The first phase, immediately following the
sear‘ch and seizure, continued through until early March. During that phase, Crown
Law negotiated with the plaintiffs with a view to obtaimng agreement upon a basis
on which all original items could be shipped to the FBI and the Crown could be
provided with passwords which would enable the FBI to access the encrypted files.
[102] The second phase of the dealings was one in which it became apparent that
no resolution of these wider issues would be able to be reached. During this phase
the Crown attempted to settle a basis upon which the Crown could nevertheless

despatch original items to the FBI, setting aside only those in respect of which there
was dispute.
[103] DLu'ing the final phase, which overlapped significantly with the second phase,
the plaintiffs’ placed before the Court the issues, in one form or another, as to the
status of the items seized, and what was to be done with them, Images of the hard
drives were sent to the FBI in the United States.
First phase: Initial attempts at a negotiated resolution as to the status ofthe items:
[104] Dealings between the various parties in relation to the items seized began as
early as 9 February 2012. They commenced with a letter from Mr Davison to
Ms Toohey seeking the Lu'gent return of Mr Dotcom’s computer and hard drives to
enable him to prepare his case in opposition to any extradition proceedings, and
suggesting that the tiles be cloned in short order. On 10 February 2012, Mr Davison
sent a further letter noting the volume of material that had been seized by the Police
and the fact that no detailed schedule had yet been provided. He wanted to ensure -
that none of the items seized by the New Zealand Police are sent out of
New Zealand or delivered into the custody or possession of representatives
of the US Government unless and until Mr Dotcom has had an opportunity
of obtaining and being provided with copies of documents or has his
computers returned following the electronic copying (cloning) being
undertaken with a view to the US Government retaining such clo11es as
evidence as to the contents of seized computers.
[105] Written assurance was sought that none of the items seized by the Police
would be provided to the US Government without proper and adequate notice being
provided so that Mr Davison could apply to the Court for an order as to the
appropriate disposition or retention ofthe items.
[106] By letter dated 14 February, Mr Davison wrote again to Ms Toohey advising
that, in the absence of any satisfactory arrangements as to the status ofthe exhibits,
his client would apply for judicial review challenging the issue of the search warrant
and would also apply for an interim order restraining the Crown and the Police from
delivering or giving possession to the US Government of all and any of the search
items seized by the Police.

[107] The day after the 16 February direction under s 49(2), Mr Foley wrote to
Ms Toohey saying that he had instructions to consider whether to challenge the basis
upon which the warrants had been obtained. He said until he had received and had a
reasonable opportunity to peruse relevant disclosure in relation to the matter", no
material or information should be passed over to the US Government or any other
government agency or persons. He recorded his expectation that, as part of the
investigation, the Police had sought assistance in imaging/cloning various electronic
devices and contained data and asked for advice on how long it would take.
[108] Although there was some intervening toing and froing between the parties,
the next significant event in the chronology is a letter from Ms Laracy, Crown
counsel, to Mr Davison dated 24 February 2012. In that letter Ms Laracy said that
although the evidence was required to be sent to the United States in its original
form, that had not yet happened and would not happen without advising the plaintiffs
first. She proposed that the Attorney-General direct that all original computer items
and other exhibits be sent to the United States in order to effect the purpose of the
mutual assistance required. In relation to Mr Dotcom’s laptop and his two external
hard drives, she proposed that they be promptly cloned and the clones provided to
Mr Dotcom. The New Zealand or United States authorities were prepared to bear' the
cost of that in relation to those specific items in order to reach a position which
reasonably satisfied competing interests and to achieve an expeditious resolution of
the issues. She said that if Mr Davison was not agreeable to the process, the Crown
would urgently seek a directions hearing in the District Court.
[109] She said that it was not pr'oposed to return the original hardware to
Mr Dotcom as the United States investigators required to examine that in its original
form. United States experts and investigators needed to work in their own laboratory
environment to analyse and clone the computer items so that they could be assessed
in the same conditions, according to the same processes and standards, and by the
same investigators as other computer items relating to the Megastuff Conspiracies
seized in other locations around the world. She said:
In short, it is not possible in the context of an investigation of this nature for
computer items to be cloned in Ne\v Zealand and tlre clones alone sent to tlre
United States. Further, it is not feasible or appropriate for the computer

items to be cloned in New Zealand first and the clones retained. That would
unduly impede the United States investigation. It would also put an
unreasonable burden on the New Zealand authorities.
[110] She noted Mr Dotcom’s intention to file a judicial review of the search
warrant by which the computer items and other exhibits were obtained, and said:
We do not see that that indication should impede the items being sent to the
United States. We believe the United States may be willing to provide an
undertaking regarding prompt return of items if the New Zealand search
were ultimately held by our Courts to be an unreasonable search and seizure.
[111] Mr Davison responded by letter dated 29 February 2012. He said that there
was an issue as to whether all of the “computer items” seized from Mr Dotcom’s
property were within the ambit of the items that could be legitimately seized and
removed pursuant to the search warr'ants. He provided examples. He continued:
Accordingly, before any fmal decision is made relating to the handover of
any computer items to the US Government, there will need to be a detailed
schedule prepared identifying each and every item that was to be handed
over to the US Govemment representatives
[112] He thanked Ms Laracy for her advice that no items had been provided to, or
sent to the United States and that she would not make any such arrangements without
lirst advising Mr Davison on behalf of Mr Dotcom. He said:
Given your indication that you will “urgently seek a directions hearing Hom
the District Court” to determine any issue of disagreement between us, I take
it that no items whatsoever will be transferred to or handed over to the US
Government or its representatives in the absence of either agreement being
reached between us that that is an appropriate course or an order ofthe Court
authorising and approving the handing over of such items to the US
Government or its representatives.
He asked for confirmation that his understanding was correct.
[113] Discussions continued between Mr Davison, Mr Foley, Ms Laracy and
Ms Toohey in relation to the possibility of cloning some items for the purpose of
disclosure to the defence. On 6 March 2012, Ms Laracy emailed Mr Foley and
Mr Davison making a ‘without prejudice’ offer to expedite the issues between the
parties in relation to the status of the various items seized. She confirmed again that
no items of evidence had left New Zealand and that the Crown would advise the

plaintiffs if it was planned that any would. She said, in relation to the few specific
computer items sought by the defence, if they could be cloned or copied safely in
New Zealand without compromising the integrity of the originals, the Police might
be prepared to use the ECL in New Zealand for that purpose. Once those items were
copied and once the plaintiffs had the opportunity to check the copies and establish
that they were accu1'ate and readable, those and all other computer items in their
original form would be sent directly to the United States. All hard copy documents
seized would be scamred by the Police onto disc and the disc sent to the United
States with hard copies remaining in New Zealand.
[114] Correspondence then ensued, both by email and by letter, about the exact
terms such an agreement might contain and as to the methodology to be employed
for cloning. On 7 March, Mr Davison proposed that the Crown prepare a draft
undertaking for his consideration. On 13 March 2012, Ms Laracy provided a draft
“evidence tr'ansfer proposal.” The first paragraph of that proposal recorded that no
items obtained under the search warrants production orders were to leave New
Zealand or to be transferred into the control of the US authorities until the “specific
items” had been imaged and readable copies had been acknowledged as received by
the respondents. The ‘specific items’ were listed and were items the plaintiffs had
requested copies of.
[115] The second paragraph recorded that originals rather than copies of the items
seized other than hard copy documentary items, were to be transferred to the US
authorities pursuant to the Mutual Assistance r'equest. The specific items would be
imaged by an FBI forensic expert who may use the premises of the Electronic Crime
Laboratory in Auckland for that purpose. It also provided that any passwords and
information necessary for the FBI expert to properly access the specific items would
be provided by the r'elevant plaintiff to Detective Sergeant Nigel McMorran in
advance of the imaging. On receipt of the copies, the plaintiffs would have up to
five working days from collection of the images of specific items to advise the
Crown Law Office in writing that they had received acceptable images of the content
of the specific items. After expiry of that period, the transfer of all evidential items
might occur.

[116] The draft agreement then recorded that, notwithstanding the pr'evious
provisions,
any items in respect of which there is a live dispute as to whether they fall
within the scope of the search warrant will be set aside for further
consideration and not transferred to US custody or control until that matter
has been resolved by the parties or by a court. Any other exhibits may,
however, be transferred to the US Authorities pursuant to the agreement.
[117] On 15 March 2012, Mr Davison wrote to Ms Laracy saying that some items
had already been identified as being allegedly outside the scope of the warrant. He
said that he proposed to review the updated police exhibit schedule with a view to
identifying any further items which Mr Dotcom contended were outside the ambit of
the search warrant or which would be readily recognisable as being of no evidential
value. He enclosed an amended agreement which included a new clause 12 which, if
accepted, would impose upon the New Zealand authorities an obligation to clone all
electronic data before handing either the originals or the cloned copies to the US
authorities.
Second phase: No agreement
[118] On 16 March, Ms Toohey emailed Mr Davison and Mr Foley to say that the
amended agreement was not acceptable to the United States because of the size of
the imaging task proposed. She acknowledged however, that it was not possible to
estimate the size of the task until the FBI had had an opportunity to preview the
contents of the electronic items. She suggested, as an interim arrangement, that two
FBI investigators would come to New Zealand to prepare two sets of the 17
specified items. They would take one set back to the United States and leave a
second set in New Zealand pending resolution. She said agreement on terms
remained possible, and asked for further detail ofthe “live dispute” items.
[119] On 16 March, Mr' Davison replied by letter' saying he was taking further
instructions in respect of the “live dispute” items. He said:
...pending the receipt of further instructions from Mr Dotcom as to what
additional “live dispute” items he contends should be added to the existing
list and pending the analysis of the materials to be undertaken by the FBI
forensic agents, it would appear premature for either party to take a final

position. Notwithstanding, there is utility and good sense to the proposed
action ofthe preparation of two sets ofthe 17 specified items.
[120] It seems the FBI agents arrived in New Zealand on 18 March. On 21 March
2012, Ms Laracy and Ms Toohey wrote to Mr Davison recording that no agreement
had been reached as to the imaging of the specific items and transfer of all items.
They recorded that the FBI agents were in New Zealand, and that:
They will make two images ofthe original 17 “specific items”. The FBI will
return to the United States after the imaging, transferring the originals of the
specific items at the same time. You will also receive the images of these
items at that time. A possible exception to this is the CCTV content which
needs to be imaged and assessed by the Police after imaging.
[121] Further on in the letter they said:
We also propose to send the originals of all other computer/digital items to
the United States. In the absence of clear idea of categories of information
that your client contends is relevant hom the items seized under warrant, it is
unreasonable to prevent their transfer to the United States. We would like to
give you an opportunity to respond in writing on this issue, setting out also
the law you rely on, so that your position can be further assessed. We would
need to have your response by 4.00 pm on Trresday, 27 March 2012. If
necessary we intend to seek directions Hom the Court. This would have to
happen urgently.
Third phase: Siaius of items seized raised in Disirict Court:
[122] Later that same day, Mr Foley emailed the Court, and served upon Crown
counsel a copy of a memorandum for the District Court in advance of a telephone
conference to be held on 22 March. In that memorandum he addressed a number of
issues including status of the various items seized and the validity of the warrant. In
relation to the imaging of items seized, his memorandum included the following:
2. (a) New Zealand imaging should be undertaken forthwith and
working duplicate copies of those images provided to the
respondents without delay to allow a check to be made as to
whether the image appears to be in working order;
(b) No device, nor copy of same, should leave New Zealand until
the respondents have had reasonable time to review images
provided;
(c) Working images of the balance of all digital items seized to be
provided to the respondents no later than 28 April 2012,

[123] Following the conference on 22 March 2012 the Judge issued a minute
recording discussion as to the need for imaging in New Zealand of the information
contained on the computers. The Judge went on to schedule a hearing in relation to
several issues which included:
To consider whether or not directions should be made regarding the imaging
of computers seized in the search and [if] so what those directions should be.
[124] Later that same day Mr Davison wrote to Ms Toohey and Ms Laracy. In the
letter he referred to a telephone conversation with Ms Toohey in which he had
sought written confirmation that, notwithstanding the tenns and contents of the letter
of 21 March 2012, having regard to the matters traversed before Judge Harvey, and
the intended Court hearing, in the absence of any agreement no items seized would
be transferred or delivered to the US government and its agents for removal from
New Zealand and transfer to the United States pending determination of the issues
by the Court. He noted previous discussions and negotiations were directed at the
imaging/cloning of specific items, which process would then be followed by an
opportunity for his client to be satisfied that the images provided in relation to his
own specified items was fully readable by him before the hardware items were
transferred or passed to the US Government representatives for removal from New
Zealand. ln the new proposal, no such opportunity was proposed. He said that,
provided it was possible to get back to an arrangement whereby there was an
opportunity for the verification of the readability of certain items, he anticipated no
difficulty in reaching an agreement that allowed the United States government agents
taking originals back with them.
[125] Ms Toohey responded by email at 5.29 pm on the afternoon of 22 March
confirming that the original computer equipment would not leave New Zealand
pending the decision of the District Cornt. However, she continued:
FBI agents who are in New Zealand are currently making two sets of images
ofthe specific items. They will take one set of images. The other set \vill be
made available for disclosure, This preserves your position in terms of
access to an image and, if necessary access to the original for the time being.
She went on in her email to say that a copy of the documentary items which the
defence already had would be sent to the US authorities for their assessment of

relevance to the investigation. She apologised for the infonnality of the email but
said that she was on leave from the next day and had little time to respond.
[126] Mr Davison did not respond to this email, but Mr Foley did. On 23 March
2012, he sent an email, copied to Mr Davison, to Ms Laracy and Ms Toohey. I set
the detail of that out in filll:
Thank you for your email, belo\v.
Images
Might you provide copies of images as they become available to allow any
checking at our end to proceed without delay?
Documentagg items
In my view the police are required to ensure that only items properly seized
pursuant to the MACMA warrant are ultimately made available to the US.
I am told a number of items were seized/obtained by the police likely f`all
outside the warrant or other statutory powers of seizure. Those items should
not be provided to the US, or anyone else. They should be retumed at an
appropriate time.
My indication during His Honour’s telephone conference yesterday followed
my memorandum for that conference (further copy attached) - tl1at NZ
authorities should go through the material to sort out what might be properly
given up and \vhat should not.
I do object to the US receiving this material before the items are checked.
As earlier indicated I would wish to take instructions as to the final list of
items to be released, and am available to \vork co-operatively on this issue
once the initial sorting exercise is complete.
Please confirm your agreement, a11d advise whether or not material has
already been provided to US authorities. If so would you please identify the
material, date of release, and to whom release was made?
He attached to that email a copy of the memorandum filed for the telephone
conference the previous day.
[127] It is this email and Mr Davison’s failure to respond to Ms Toohey’s email,
that the Crown relies upon on as evidencing consent on the part of the plaintiffs to
the shipment of the copies. In her affidavit filed in this proceeding Ms Laracy notes
that Mr Davison did not respond to the email from Ms Toohey, and that Mr Foley,
under the heading of “Images”, makes no complaint about the proposed course of

action. She says that the rest of the email relates to the heading “Documentary
items”.
[128] Detective Sergeant McMo1ran’s evidence is that shortly after 5.00 pm on 23
March he was told by the FBI they had arranged for “seven ha1'd drives” to be
shipped by FedEx to the United States. There is no direct evidence of what Crown
Law had communicated to the Detective Sergeant as to whether the FBI could take
the images, but his evidence was that “ultimately” his understanding was that the
FBI could. He said he made no 1'eport of his discussion with the FBI regarding these
“seven hard drives”, and from the next day was on leave.
[129] At 5.06 pm on that day Ms Laracy filed a memorandum in the District Couit,
seived on the plaintiffs’ counsel, in which she recorded that the key issues for
resolution were:
Duties and entitlements for New Zealand parties in respect of
digital/computer items seized under the MACMA warrants for transfer to,
and examination by, the United States authorities;
[130] At 5.46 pm on 23 March Ms Laracy responded to Mr Foley’s email
confirming that no items of evidence had left New Zealand and setting out an email
from Detective Sergeant McMorran. In his email Detective Sergeant MCMO11'3.H
concludes:
The FBI are going to be working through the weekend to get all this
completed and hope to have everything finalised by next Thursday and are
booked to leave New Zealand on the 315' March. Prior to leaving they will
run the copies to ensure they can be read and then once satisfied they will
return a copy and the original to ECL who in turn will hand them back to
OFCANZ for storage pending the outcome ofthe hearing on the 2"d-3‘d April
or directed otherwise by the Crown.
[131] Although Ms Laracy’s email, and its enclosure, created a misleading picture
as to the status of the evidence, I accept that timing delays explain the inaccuracy of
the information she conveyed.
[132] The next relevant step in the chronology is the filing of an application fO1'
orders relating to items seized under the MACMA warrant. This was filed by

Mr Foley on 26 March 2012, and picks up the text of the original memorandum filed
by Mr Foley. The first order he sought was as follows:
That in relation to seizure under warrant or otherwise of files or items
containing, or capable of containing electronically stored information:
(a) Imaging of those devices is to be undertaken forthwith and working
duplicate copies of those images provided to the applicants without
delay to allow checks to be made as to whether the image appears to
be in working order;
(b) That no device, nor copy of the same, is to leave New Zealand until
the applicants have had a reasonable time to review images provided
and have confirmed and responded in writing that they are able to
use the images;
(c) That the respondent obtain an undertaking from the US authorities
that working images of the balance of all digital items seized are to
be provided to the applicants no later than 28 April 2012.
[133] It was after this application was filed that the second instalment of images
was shipped by the FBI to the United States (on 28 March). There is no evidence as
to the circumstances of this shipment. Detective Sergeant McMo1~ran was away on
leave by this time. Detective Inspector Wormald does not seem to have been directly
involved in any dealings with the FBI in relation to this second shipment.
VWIS there consent?
[134] It is difficult to construe this sequence of events as evidencing the plaintiffs’
agreement to images of the hard drives being released to the FBI. Earlier on the day
Ms Toohey sent the email (22 March) on which the Crown relies, Mr Foley, for his
clients had raised the status of the items seized, (including copies of those items), as
an issue that required resolution by the Cotut and a hearing date had been set.
Mr Davison followed that conference up with both a telephone call and letter in
which he requested Written confirmation from the Crown that no items seized would
be transferred.
[135] Ms Toohey did not provide that written confirmation but rather stated the
FBI’s intention to take one set of copies, and make one available for disclosure.
However, she provided no time frame as to when the FBI would “take” the imaged
copies and interest was nothing to indicate it would be the next day. But

Ms Laracy’s and Ms Toohey’s letter of the previous day proposed that the plaintiffs
had until 4.00 pm on Tuesday 27 March 2012 to identify “live dispute” items, those
items the plaintiffs disputed fell within the tenns of the warrant. This timing was
consistent with Detective Sergeant McMorran’s statement that the FBI were leaving
on 31 March, Given this context, the plaintiffs would not likely have understood the
22 March email as imposing a 24 hour deadline. Indeed it seems that the Police and
the Crown also did not expect the clones to be shipped the next day.
[136] As to Mr Foley’s response 1 accept that there is some ambiguity in the setting
out of his email, but the most obvious reading of it is not that proposed by
Ms Lar'acy. The email is more sensibly read as containing preliminary comments in
relation to both “images” and “documentary items”, and then going on to address
matters of general process affecting all items seized. This is particularly so when the
email is read along with the memorandum it attached.
[137] The fundamental objection to construing what occurred as consent however
is that the plaintiifs had by that time squarely placed the status ofthe items seized,
including copies of those items, before the Court. In these cir'cumstances the Crown
could not reasonably proceed on the basis that the plaintiifs consented without
obtaining their express consent. Silence was not enough (though of course,
Mr Foley was not silent). At best the correspondence was ambiguous and given that
a hearing date had been allocated for resolution of issues in relation to the status of
the items, the Crown needed to proceed with considerable caution to ensure that it
did have the plaintiffs’ consent, ii indeed it was seeking it.
[138] Ms Toohey, as counsel for the Central Authority has elected not to tile an
aiiidavit setting out her' communications with the Police. This may cloud the picture.
Nevertheless the correspondence and aiiidavits create a clear impression that there
was confusion between the Crown and the Police, and perhaps even within the
Crown team, as to what was occurring in relation to the images. This was probably
contributed to by the fact that two key people, Detective Ser'geant McMorran and
Ms Toohey went on leave at the critical time. This may explain why the Crown did
not advise the District Court Judge that images had already been shipped by the FBI
to the United States. It is hard to see why, if matters proceeded as the Crown

suggests, the duplicate copies that were taken were not then made available to the
plaintiffs, when that was what Ms Toohey had proposed in the email of 22 March.
[139] Finally, I mention the Crown’s reliance on a telephone conversation between
Detective Sergeant McMorran and Mr Davison that is described in an affidavit filed
by Detective Sergeant McMorran and also recorded in a note of the telephone
conversation he kept in his diary and has annexed to his affidavit. He says that he
told Mr Davison that copying had taken place and that as far as he was aware some
copies of specific items had been sent by the FBI to the United States and he also
says that Mr Davison did not object to this. Mr Davison has chosen not to file an
affidavit to describe the correspondence and exchanges or to personally respond to
any of the Crown material on this issue. To do so would cause him difficulty in his
representation of Mr Dotcom in terms of the professional rules of conduct. As it
happens I do not attach significance to this conversation, as it is meaningless in this
context to speak of consenting to that which has already happened, and in any case,
Mr Davison represents only one of the plaintiffs.
[140] To conclude, I find no evidence that the plaintiffs consented to the clones
being shipped to the FBI in the United States. Given the confused nairative of
events that emerges from the correspondence and affidavits and the incomplete
material, I do not propose to make any finding beyond that.
MD Would the Solicitor-General have consented to the S/1QlI1I€l1f?
[141] The final submission made on behalf of the Central Authority is that the
Deputy Solicitor-General (acting as the delegate of the Attorney-General) would
have given a direction to the Police to allow the FBI to ship the images if he had
been requested for such a direction to enable this to proceed. For this reason, any
breach of s 49(2) is of a technical nature only. In this Mr Pike refers to an email
dated I6 March 2012 from Ms Toohey to the United States Central Authority, the
Police and others in which she says:
I have spoken to our Deputy Solicitor-General this morning in 1'elation to
your query. We think it would be acceptable for the two FBI agents to come
to New Zealand, but could they do two clones, one set for the US, and one

set to leave behind for disclosure, once agreement or a litigated resolution is
reached?
[142] In written submissions the Crown said that this was evidence of the Deputy
Solicitor-General’s consent to the clones being sent offshore. In oral submissions
Mr Pike accepted that although this email was not evidence of a s 49(2) direction, it
was evidence that such a direction would have been given if it was requested of the
Deputy Solicitor-General.
[I43] This argument has the fatal flaw that the email is dated 16 Mar'ch and refers
to different arrangements than those proposed in Ms Toohey’s email of 22 March.
Moreover it was after that date that the status of the items seized was raised with the
Court, and a hearing date allocated. In that context I do not accept that the Deputy
Solicitor-General, if properly informed of this background, would have directed the
release to the FBI of the copies. The Crown is held to the standards of the model
litigant, yet to take such an action would be to defeat at least part of the purpose of
the plaintilfs’ application to the District Court, and also render futile, at least part of
the District Court dete11nination.3°
D. Summary of findings
[144] I summarise my findings as follows:
(a) The warrants did not adequately describe the offences to which they related.
Indeed they fell well short of that. They were general warrants, and as such,
are invalid.
(b) The warrants were expressed to authorise the sear'ch for and seizure of very
broad categories of items. These categories of items were defined in such a
way that they would inevitably capture within them both relevant and
irrelevant material. The Police acted on this authorisation. The warrants
could not authorise seizure of irrelevant material, and are therefore invalid.
3° As it happens the application in the District Court was not proceeded with, the issues having
become subsumed in this proceeding and in the application to the District Court for disclosure.

If the warrants had been adequately specific as to offence and scope of
sear'ch, it may still have been appropriate for the issuing Judge to impose
conditions. Conditions could have addressed the offsite sorting process,
which was inevitable for the items taken away from the search sites. The
conditions could have provided for the cloning of hard drives, the extraction
of relevant material and the return to the plaintiffs of the original hard drives,
or their clones.
The Police relied on invalid warrants when they searched the properties and
seized the various items. The search and seizure was therefore illegal. If it is
relevant, I will hear counsel on Whether in each case this therefore amounted
to an unreasonable search and seizure for the purposes of s 21 of the New
Zealand Bill ofRights Act l990.
If I am wrong that the warrants were invalid, then it is nevertheless clear that
the Police, in executing the warrants, have exceeded what they could lawfully
be authorised to do. This is because they continue to hold, along with the
relevant, in‘elevant material. The Police have adopted this approach because
they have no request from the United States Central Authority to sort the
relevant from the irrelevant, and in any event do not have the ability to
undertake this exercise Without assistance. The Police faced operational
difficulties in executing these search warrants in a lawful manner because
they are not the investigating oiiicers with knowledge of the operation. The
pr'ovisions of the MACMA ar'e however sufficiently flexible to enable the
Police to involve overseas investigating oiiicers in the execution of Warrants
to meet this operational difficulty.
The release of the cloned hard drives to the FBI for shipping to the United
States was contrary to the l6 February direction given under s 49(2) of the
MACMA that the items seized were to remain in the custody and control of
the Connnissioner of Police. It was therefore in contravention of s 49(3) of
the MACMA.

The New Zealand Central Authority argued that any breach of s 49(3) was
technical because the plaintiffs consented to the shipment of the clones to the
FBI in the United States. I have fotmd that no consent was given by the
plaintiffs. Given the confused narrative of events that emerges from the
correspondence and aliidavits and the incomplete nature of the evidence, I do
not propose to make any finding beyond that.
The New Zealand Central Authority also argued that the Deputy Solicitor-
General would have given a direction under s 49(2) authorising the shipment
of the clones to the FBI in the United States, had he been asked. Any
contravention of s 49(3) was therefore technical. I do not accept that the
Deputy Solicitor-General would have given such a direction, if informed that
the status of all items seized, including copies of those items, was the subject
of an application by the plaintiffs to the District Court.
l45 The substantive relief sought by the plaintiffs is as follows:
a. An order by way of declaration that the MACMA Search warrants
were unlawful;
b. An order by way of declaration that the removal of clones from New
Zealand was contrary to the Solicitor-General’s direction to the
Commissioner of Police dated I6 February 2012, was not authorised
in accordance with s 49 of MACMA and was accordingly unlawful;
c. An order that none of the items seized nor clones or copies thereof
remaining in New Zealand, be permitted to leave New Zealand or be
accessed in any way other than in accordance with the process set out
in below, subject to further order ofthe Court;

An order that the first defendant forthwith provide the plaintiffs with
the clones of seized items currently held by the New Zealand Police
(the existing clones);
An order requiring the first defendant to provide confirmation in
writing to the plaintiffs identifying those items, the clones of which
have been removed from New Zealand, and confirming whether or
not the existing clones are eEectively duplicates of the clones
removed from New Zealand.
An order providing for the following process:
i. The appointment of an independent and appropriately
experienced barrister or barrister and solicitor of the High
Corut of New Zealand (the independent practitioner) to
conduct the review set out below and to otherwise assist the
parties in effecting this process.
ii. The review, by the independent practitioner, of all items
seized, for the purpose of identifying irrelevant and privileged
material.
iii. That clones containing only relevant and non-privileged
material located on the seized electronic items (the disclosable
clones) be created and provided to the United States
authorities; and
iv. That the first defendant meet the reasonable costs and
expenses ofthe independent practitioner, including the cost of
such technical assistance and/or resource as he/she might
reasonably require.
An order requiring that all items identified as containing no relevant
material be returned forthwith to the plaintiffs.

h. An order that complete clones of those seized items which are found
to contain any relevant and non-privileged material be provided to the
plaintiffs as soon as possible, and in any case, not later than the
disclosable clone of that item is provided to the United States
authorities.
i. An order directing the first defendant to notify the relevant United
States authority of the Court’s decision in this matter, and request the
voluntary return of the clones removed from New Zealand, along with
any copies/clones or data taken therefrom.
j. The ability for either party to seek further orders from the Court as
required, including in relation to any dispute as to the relevance or
privilege attaching to a certain item or items during the review by the
independent practitioner.
[146] For the reasons given at paragraph [3 5] above, 1 am satisfied that declarations
should issue in relation to the validity of the warrants and the transfer of the clones.
1 will hear counsel in relation to the form of those declarations if counsel are unable
to agree on them.
[147] I am not at this point prepared to make the remaining orders sought. Given
the extent of the challenges, and the nature of my findings, 1 require to hear further'
hom counsel as to the appropriate remedy or remedies before making any order.
This proceeding can be listed before me at 10 am on 4 July 2012 (prior to the hearing
of the related judicial review proceedings) for the purposes of timetabling necessary
steps for that purpose.
Winkelmann J

Solicitors:
Simpson Grierson, Auckland
Crown Law, Wellington
Counsel:
P J Davison, Auckland
GJ Foley, Auckland
M J Ruffin, Auckland

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