Yesterday it emerged that incorrect information supplied by the Police's Organised and Financial Crime Agency (Ofcanz) led to the Government Communications Security Bureau (GCSB) unlawfully monitoring the communications of Kim Dotcom and one of his associates.
Court documents show that after being asked by Ofcanz to monitor the communications of Dotcom and his associates, the GCSB asked for assurances the men were all foreign nationals.
The GCSB is forbidden by law to spy on New Zealand citizens or permanent residents.
Ofcanz gave the assurance all four were foreign nationals, despite Dotcom and his Dutch co-accused Bram Van Der Kolk being permanent residents of New Zealand.
Mr Pike told the court today that the information gathered by the spy organisation was relevant to the arrest operation carried out by police.
He said the Crown would disclose information about the spying while protecting its sources and channels.
Earlier, the court heard from Dotcom's lawyer Paul Davison QC who said information from the Crown showed the spy agency was concerned about the movements of Dotcom and his co-accused.
He said the evidence suggests there could have been more spying by the GCSB.
Mr Davison said "independent eyes'' were needed to look at the information and report back to the court.
Before today's proceedings began, Dotcom told waiting media that he had to restrain his comments in light of his extradition hearing scheduled for March this year.
"All I want to say to you today is this New Zealand Government has underestimated the sophistication of New Zealanders, of their media and especially of the courts ...
"The courts in New Zealand, they are dealing with lies, cover-ups and fake stories on a daily basis and they will see straight through this and it will lead them to an open and honest discovery of everything that happened, and it is in the interest of all New Zealanders that we get to the bottom of this.''
The wrangle over the GCSB's involvement is only the latest in a series of legal missteps by police and other agencies involved in the January 20 raid on Dotcom's Coatesville mansion.
The courts have also heard legal arguments over the use of search warrants later found to be invalid, and the seizure of Dotcom's cash, cars and property using a court order which should never have been granted.
Spying on the group began on December 16 last year and ended on January 20 but did not involve installing devices.
Detective Inspector Grant Wormald, who oversaw the raid, told the High Court last month of meetings just before the raid and also two months earlier that were attended by what was then referred to as an unnamed government organisation.
Asked by Mr Davison whether anyone other than police had Mr Dotcom under surveillance at the time of the raid, Inspector Wormald said there wasn't.
That exchange took place on August 9. A week later, acting Prime Minister Bill English issued a Ministerial Certificate - essentially a suppression order - to Mr Wormald, Police Commissioner Peter Marshall and GCSB director Ian Fletcher in which he said disclosing the involvement of the GCSB "would likely prejudice the security of New Zealand".
"I direct that neither you nor any other person subject to this direction shall provide any information or answer any question in this proceeding" Mr English said in the certificate which was obtained by TV3's Campbell Live.
- additional reporting Adam Bennett
