Kim Dotcom and his lawyer are calling into question the evidence under oath given by a top police officer, calling it inconsistent.
The internet millionaire has been in the High Court at Auckland again on Wednesday, fighting to get access to evidence against him, including material illegally gathered by the Government's spy agency.
He is fighting extradition to the United States to face copyright, money laundering and fraud charges.
Detective Inspector Grant Wormald gave evidence at an earlier hearing, saying apart from surveillance carried out by the police, there was no other surveillance of Mr Dotcom to his knowledge.
Defence lawyer Paul Davison, QC, told the court on Wednesday that is inconsistent with what has now been released about the involvement of the Government Communications Security Bureau (GCSB).
Court papers show it was the Organised Financial Crime Agency, which Detective Inspector Wormald heads, that gave an assurance.
The Chief High Court Judge, Justice Winkelmann, ordered a lawyer independent of all parties be appointed to assist the court in what material can be released.
After that, she will be able to make orders about the evidence seized both by the Government spy agency and during the police raid on Mr Dotcom's home in January, which was carried out under anillegal search warrant.
Judge questions how agency didn't know
During Wednesday's hearing, Justice Winkelmann questioned how the GCSB could have been unaware Mr Dotcom is a New Zealand resident.
The hearing addressed fresh information in High Court documents, revealing the spy agency acted illegally against Kim Dotcom - believing he is a foreign national when he is in fact a resident - due to incorrect advice from police.
It is illegal for the GCSB to spy on New Zealand residents and it is being investigated over the matter.
Justice Winkelmann said she is concerned it took so long for the GCSB to realise it had acted illegally, given the extent of media coverage in the case.
The judge also acknowledged that proceedings in the case have been slow, describing them as dribbling along as more information comes out.
Credibility issue - lawyer
Mr Davison questioned the credibility of Crown Law.
He told the court that Crown lawyers were heavily involved with police, the GCSB and the raid on his client's home near Auckland on 20 January this year and may be conflicted in the work they do.
Mr Davison said Crown Law has put up witnesses who have given incorrect evidence and have held back crucial information. He told the court enough is enough and asked for a full disclosure of material gathered during the illegal surveillance of his client.
A Crown Law lawyer has rejected any suggestion that the office is too involved in aspects of the Dotcom case, and therefore uncredible.
John Pike says that is not the case at all.
Mr Pike says Crown Law is an entity that represents the Government in a wide range of activities.
He says it does a substantial amount of prosecution, and it is not at all unusual for Crown lawyers to give police legal advice.
Dotcom - case could be compromised
On his way into court on Wednesday, Kim Dotcom said the Government is underestimating the sophistication of New Zealanders, of the media and especially of the courts.
"The courts in New Zealand are dealing with lies, cover-ups and fake stories on a daily basis, and they will see straight through this."
Mr Dotcom says the whole case against him could be compromised by evidence that has been illegally gathered.
He also says he wants to know if the United States has been spying on New Zealand residents at the same time as the local spy agency.
Mr Dotcom says he understands the agreements between New Zealand and the United States allow for US spy agencies to access all data the counterpart in this country is gathering.
Mr Dotcom says it's in the best interests of all New Zealanders for the truth to come out.