Newell further argued for continued name suppression and said there was a potential prejudice to his client's fair trial rights and prejudice to potential witnesses who may come forward.
"Their evidence would be tainted," Newell said.
Crown solicitor Brian Dickey, opposing the application for name suppression, said there was no issue surrounding fair trial rights.
"These events happened in Washington in the confines of the embassy ... There was an extensive police investigation at that location," he told the court.
The court heard from Newell that publication of the man's name may also cause hardship to his employer and endanger the safety of his family.
Judge Glubb said he was not satisfied that the man's fair trial rights would be breached or that any of the other issues raised would create undue hardship if his name was published.
The judge made an order to lift the suppression of the accused's identity - however Newell immediately indicated he would appeal the judge's decision - resulting in suppression automatically being reimposed in the interim.
The man was remanded on bail until the case will be heard again in July.
The Ministry of Foreign Affairs and Trade and other government ministries have directed questions about the case by the Herald to police.
Police have simply confirmed a person has been charged in relation to "an offshore matter".
International law experts previously told the Herald New Zealand's criminal jurisdiction applies to the case because of where the alleged act occurred or who the accused is.
The New Zealand embassy is located in an area of Washington called Embassy Row, where many countries have diplomatic outposts and attaches stationed.
New Zealand's current Ambassador to the United States is Tim Groser.
