After proceedings began in September, Kim Dotcom began his extradition hearing defense in New Zealand today. His legal team argued that U.S. prosecutors cherry-picked evidence, intentionally mis-translated discussions to make the entrepreneur look bad, and created criminal liability for service providers where none exists.

Two-thirds through September Kim Dotcom’s long-awaited extradition hearing finally got underway.

Expected to last just four weeks, progress was hindered by legal argument, much of it centered around claims that Dotcom and former colleagues Mathias Ortmann, Finn Batato and Bram van der Kolk, weren’t getting a fair hearing.

Attempts to delay the extradition on those grounds ultimately failed last week and today Kim Dotcom’s defense finally got underway. As expected, lawyer Ron Mansfield immediately began painting a negative picture of U.S. prosecutors, highlighting selective use of evidence and subtle attempts at twisting discussion transcripts in their favor.

Much had previously been made of apparently incriminating Skype calls Dotcom had placed with his former business partners, but today Mansfield said the U.S. had knowingly translated those from German to suit their cause.

One, in which Dotcom allegedly said: “At some point a judge will be convinced how evil we are and then we are in trouble,” was corrected by Mansfield to state: “Because at some stage a judge will be talked into how bad we allegedly are – and then we will be a mess.”

Another instance, seen in the 3News image below, shows a Dotcom reference to individuals who uploaded large amounts of content to the site. For both sides in this fight the differences between the two translations are small but significant.

“It’s not only a misrepresentation which was known by the United States, it is one which it has exploited for its own benefit,” Mansfield told the court.

The U.S. had cherry-picked evidence sampled over several years, he said, discarding everything that contradicted their case and retaining anything that didn’t.

“What the United States have done here is simply bundle up years of selective or ‘cherry-picked’ conversations where those conversations [appear to show] an awareness or knowledge of copyright infringement,” Mansfield said.

While actual knowledge of copyright infringement is indeed a serious matter, Mansfield argued that there are limits on how far a company like Megaupload can be held liable for the actions of its users.

He said that in both New Zealand and the United States laws exist to protect people like Dotcom and the service provider companies they create, and the U.S. is attempting to create criminal liability where non exists.

“What the US is effectively saying to Internet service providers is: ‘You need to actively investigate copyright infringement and stop it, because if you don’t you’ll not only be civilly liable but criminally liable’,” Mansfield said.

“Internet giants like Google, Facebook and Twitter are immune from prosecution and to indict them would result in unprecedented public outrage.”

Of course, U.S. prosecutors aren’t placing Megaupload in the same category as the companies listed above. However, Dotcom’s lawyer said that Megaupload was not only legitimate, but also had the backing of some of America’s biggest stars.

To prove his point, Mansfield began playing the controversial ‘Mega Song‘, an advert that gained so much traction late 2011, just weeks before the raid on Dotcom.

Starring P Diddy, Will.i.am, Alicia Keys, Snoop Dogg and Kanye West, among others, Mega Song showed that Megaupload was mainstream and ‘up front’. Judge Nevin Dawson apparently didn’t see the video’s relevance, however, and ordered it to be switched off part way through.

Dotcom’s defense is expected to run for the remainder of the week. If extradited to the U.S. and subsequently found guilty, both he and his former colleagues face several decades in jail.