That investigation was dropped previous year after the prosecutor said leads had been exhausted. Though that case eventually timed out in May past year, the unwelcome guest has stayed put because he fears being arrested by British police and handed over to the Americans, who want to prosecute him over his WikiLeaks website.
Mr Assange denies the allegations. He... Swedish authorities dropped the charges, assuming they couldn't get Assange to the country for questioning, but the United Kingdom still has a warrant.
His lawyer Mark Summers told a London court last week that the warrant had "lost its objective and its function".
A warrant was subsequently issued by Westminster Magistrates' Court. A decision in Assange's favor would end Britain's case against him.
She said: "One, Mr Assange has been bailed, two, he has failed to surrender, and three, if he has no reasonable cause he will be guilty of an offence".
Judge Arbuthnot said the health issues were "not that bad", but he had "a real problem with a tooth (which) must be agonising".
A courtroom defeat means Assange still faces arrest for jumping bail, although British police no longer maintain a round-the-clock security presence outside the embassy.
Assange sought asylum in the embassy because he feared Swedish police would eventually extradite him to the U.S., where he could face decades in jail over WikiLeaks' publication of thousands of secret military documents in 2010.
The magistrates rejected the argument of Assange's lawyers, who alleged that the order "makes no sense" after the withdrawal last May of the extradition request for alleged sexual abuse in Sweden. British authorities have declined to confirm or deny if a United States extradition warrant has been received.
Julian Assange's lawyer Jennifer Robinson speaks outside court on Tuesday.
Earlier this year Ecuador's foreign minister Maria Fernanda Espinosa said the South American nation was seeking a "third country or a personality" to broker a final settlement with the British government to resolve Mr Assange's future.
"Failing to surrender to bail is like insulting the court's authority" and unlikely to go down well with the court, she said.