As Kim Dotcom's extradition defense enters its second day, the court has heard that none of the 13 charges against the Megaupload founder are enough to extradite him to the United States. The U.S. is characterizing the alleged offenses as extraditable fraud but Dotcom's team believes that copyright violations can not be prosecuted as such.

The extradition hearing of Kim Dotcom and former colleagues Mathias Ortmann, Finn Batato and Bram van der Kolk, continued in the Auckland District Court today.

The quartet is fighting deportation to the United States on serious charges including conspiring to commit copyright infringement, conspiring to commit money laundering, and engaging in a racketeering conspiracy.

However, the court heard from the defense that the offenses don’t meet the criteria for the men to be sent to the United States.

Dotcom’s lawyer Ron Mansfield said the Crown, arguing on behalf of the United States, has been attempting to characterize the charges against the men as fraud, an extraditable offense.

However, he pointed out that the US Supreme Court previously ruled that copyright infringement can not be considered fraud. A key case, Dowling v. United States, is referenced in a white paper published by Kim Dotcom (pdf).

It’s important for Dotcom to make a clear distinction between copyright infringement and fraud. Mansfield says that all of the 13 charges against the Megaupload founder are underpinned by copyright infringement allegations.

Also muddying the waters is the fact under United States law one of the criminal copyright infringement charges brought against Dotcom has already exceeded its time limitations. The others, Mansfield said, are not aimed at his client and are dependent on other charges being proven.

“Categorically there is no case to answer under US law,” he said.

“Unless the United States can show an offense of criminal secondary copyright infringement in the United States as a matter of law, this court must reject this application for surrender.”

But locally there are issues too. Mansfield told the court that New Zealand legislation does not recognize copyright infringement as fraud either and the extradition treaty between the two countries does not hold copyright infringement as being an extraditable offense.

“That’s the end of the story, really,” he told Judge Nevin Dawson.

Further boosting Dotcom’s position, Mansfield argued yesterday that even charges of (non-extraditable) copyright infringement are excessive.

As the operator of a service provider company, Dotcom and his colleagues should’ve enjoyed ‘safe harbor’ and not been held liable for the infringing acts of their users.

Dotcom’s defense is expected to conclude this week but no matter what the outcome, it’s unlikely to be the end of the extradition legal process. Whichever side loses, both are expected to take their case to appeal.