US court refuses to reconsider decision in Microsoft email case

Landmark ruling on drugs warrant was issued over data stored on servers in Dublin

Microsoft: the company is  thought to be the first US company to challenge a domestic search warrant seeking data held outside the country. Photograph: Lucy Nicholson/Reuters

Microsoft: the company is thought to be the first US company to challenge a domestic search warrant seeking data held outside the country. Photograph: Lucy Nicholson/Reuters


A US federal appeals court has refused to reconsider its landmark decision forbidding the US government from forcing Microsoft and other companies to turn over customer emails stored on servers outside the United States.

Microsoft had been challenging a warrant issued in relation to a drugs case seeking emails belonging to an EU citizen, which were stored on a server in Dublin.

Tuesday’s four-four vote by the Second US Circuit Court of Appeals in Manhattan, New York, let stand a decision of July last year that was seen as a victory for privacy advocates and for technology companies offering cloud computing and other services worldwide.

But the dissenting judges said that a unanimous decision by the initial three-judge panel could hamstring law enforcement, and called on the US supreme court or Congress to reverse it.

“The panel majority’s decision does not serve any serious, legitimate, or substantial privacy interest,” judge José Cabranes wrote in dissent.

US department of justice spokesman Peter Carr said: “We are reviewing the decision and its multiple dissenting opinions and considering our options.”

Microsoft had no immediate comment.

In the July decision, judge Susan Carney ruled that Microsoft could not be forced to turn over emails sought for a narcotics case, but stored on a server in Dublin.

Though Microsoft is based in Washington state, Ms Carney said the emails were beyond the reach of domestic search warrants issued under the federal Stored Communications Act 1986.

Microsoft was thought to be the first US company to challenge a domestic search warrant seeking data held outside the country.

Significant attention

The case attracted significant attention from technology and media companies concerned that a ruling for the government could jeopardise the privacy of customers, and make them less likely to use cloud services if they thought data could be seized.

Microsoft’s position was supported by dozens of technology and media companies including Amazon, Apple, Mozilla, CNN, Fox News Network and Verizon Communications, as well as the American Civil Liberties Union and US Chamber of Commerce.

But the dissenting judges said on Tuesday it should not matter where the emails were stored because Microsoft was a US company.

They also said the panel did not properly address the challenges that electronic data storage poses for law enforcement.

“It has substantially burdened the government’s legitimate law enforcement efforts; created a roadmap for the facilitation of criminal activity; and impeded programmes to protect the national security of the United States and its allies,” Mr Cabranes wrote.

The judge expressed hope that the panel’s view of the 1986 law “can be rectified as soon as possible by a higher judicial authority or by the Congress”.

Microsoft president and chief legal officer Brad Smith told The Irish Times in an interview in Dublin last October he was optimistic the earlier second circuit court decision would stand.

The court had agreed with Microsoft’s argument that the 1980s law on telecommunications did not imply the US government could demand emails held outside the US, without a warrant and using the existing international treaty process.

“The reason I’m so optimistic is, frankly, the logic that was adopted by the second circuit is clear, it is compelling, it’s very consistent with traditional American legal principles,” he said.

“The court of appeals basically adopted what we’d been saying from the outset, that US law doesn’t reach outside the United States unless Congress specifically says that it intended it to do so, and Congress never said it intended, or said it intended to do so, when it passed this law in 1986.”

Privacy rights

Mr Smith said the company had learned “the importance of standing up for privacy rights. To some degree, I think our whole industry needed to react to what we learned in the wake of the [Edward] Snowden disclosures.

“We learned things of which we were not aware. And we came away from that with a renewed determination to protect privacy and I think what we at Microsoft were able to do was harness all the learning we had gained through all the legal issues around the world, and really use that to be more proactive.”

Microsoft said when it filed its case that federal courts had issued almost 2,600 secrecy orders barring it from disclosing government warrants for access to private email accounts.

It said more than two-thirds of those orders have no fixed end date, meaning the company may never tell customers about them, even after an investigation was completed.

– (Additional reporting: Agencies)