Sorry to hear about the ticket, but I'd like to offer three things:

First, a LSD was a dealer-installed option (never factory installed), and installing it did not change the axle ratio. However, as already noted, different axle ratios were offered depending on the type of transmission, and sometimes also the locale of the market to which the car was shipped.

Nevertheless, to correct a minor version of your problem, Volvo parts used to have (don't know if they're still available) different gear drives that insert into the transmission and into which the speedometer cable is inserted. Also, they also had a variety of speedometers keyed to different drive ratios and tire sizes (wagon's vs sedan's). Of course, if your son has changed his tires to a different, larger diameter, that is another factor.

Second, a speedometer error of 31% (really 85 at an indicated 65) is far more than would be explained by either a different rear axle ratio or the installation of larger tires (a "mudder" tire from a jacked up pick-up truck would be required for that much change). Not to mention that such a setup would reduce torque at the drive wheels so much that the car would never reach 65 mph (let alone 85) without going downhill with a tailwind.

I've got a feeling that your son has exaggerated his innocence a little bit. Have you driven the car to determine speedometer inaccuracy? Check it yourself against the method(s) I outlined below in the bottom paragraph.

Third, I gave a quick call to my daughter and son-in-law, both lawyers, because it was an interesting question, and they told me that equipment problems such as you described does not alter his guilt -- the driver is responsible for knowing his speed in any case. However, a sympathetic judge might take that into consideration when deciding on the fine, even if his insurance company almost certainly won't when they add on penalties, nor the state when figuring points unless the judge also lessens the charge.

How long has you son been driving the car? Didn't he notice before now that he was passing everyone on the road? In any case, not only can you measure the speedometer error by using an almost ubiquitous GPS (everyone seems to have one attached to their windshield), plus you can always use the "ancient" method of timing your travel along highway markers (the green things on the side of the road). At 60 mph, you should go one measured mile in one minute.