Dotcom, also known as Kim Schmitz, was arrested nearly five years ago after the FBI shut down Megaupload and accused him of willful copyright infringement, as well as a string of other offences.
The website attracted more than a billion visits and had more than 150 million registered users. The FBI alleged Megaupload earned more than $175 million in revenue at a cost of more than $500 million to copyright owners.
A long legal battle followed, with German national Dotcom fighting his extradition from New Zealand, where he has permanent residency.
The High Court of New Zealand held on 20 February that copyright infringement by digital online communication of copyright protected works to members of the public is not a criminal offence in New Zealand.
But a “conspiracy to commit copyright infringement amounts to a conspiracy to defraud and is therefore an extradition offence listed in the US-NZ Treaty,” the High Court ruled.
Dotcom tweeted that the judgement clarified that online copyright infringement is not a crime in New Zealand, but expressed that he felt singled out.
He tweeted: “New Zealand Copyright Law (92b) makes it clear that an ISP can't be criminally liable for actions of their users. Unless you're Kim Dotcom?”
“Extradition Judgement in a nutshell: We won but we lost anyway.”