A New Zealand court has found that the search warrant used to arrest the founder of Megaupload, Kim Dotcom, was legal. That puts a big hole in his defense.

It was two years ago that he was arrested at his mansion and his laptops and hard drives were seized. That action was appealed and a lower court decided that it was not legal because it was too vague. However, the New Zealand government, acting for the US authorities, has successfully appealed the decision.

The court said in a statement: "In deciding that the search warrants were valid, the Court of Appeal accepts that they were in form defective in some respects, but the defects were not sufficient to mean that the warrants should be treated as nullities."

"Mr. Dotcom and the other respondents would have understood the nature and scope of the warrants, especially in light of their arrest warrants, which were not defective, and the explanations given to them by the Police when the properties were searched. In these circumstances no miscarriage of justice occurred."

The Department of Justice has said in a filing that Dotcom was the head of "a worldwide criminal enterprise, which operates and administers several internet websites that reproduce and distribute infringing copies of copyrighted works, including motion pictures, television programs, musical recordings, electronic books, images, video games, and other computer software".

It wants to extradite him back to the US.

Dotcom's legal team will probably appeal the decision to the Supreme Court.