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Lawyers for Microsoft say they will appeal a federal judge’s order that they turn over the contents of a customer’s email that’s stored on a server in Ireland. But if Microsoft were to comply with the order, it appears that the company would be in violation of both Irish and European laws.
“It’s the business that gets squeezed. Microsoft faces the wrath of the U.S. and the European courts,” said Heather Egan Sussman, a privacy law expert with the law firm of McDermott Will and Emery. “It’s a tough pickle to be in.”
What’s worse is that the warrant that was served on Microsoft is on shaky constitutional grounds, simply because under normal circumstances a warrant can only be used for evidence that’s located inside the United States. Currently, the federal prosecutor is depending on a novel concept of a “hybrid” warrant that also has aspects of being a subpoena, which can demand evidence from overseas.
The warrant was granted by a federal magistrate and when Microsoft objected, saying it violates the Constitution as well as the law where the data is located, the U.S. District Court for the Southern District of New York agreed to hear the case. On July 31 federal Judge Loretta Preska agreed with the government’s position, but also agreed to stay her order so that Microsoft can appeal to the decision to the U.S. Circuit Court of Appeals.
Microsoft has said it won’t waste any time in filing an appeal. “The only issue that was certain this morning was that the District Court’s decision would not represent the final step in this process. We will appeal promptly and continue to advocate that people’s email deserves strong privacy protection in the U.S. and around the world,” said Brad Smith, Microsoft’s general counsel and executive vice president, Legal and Corporate Affairs, in a prepared statement released shortly after the hearing.
As you might expect, the Europeans are watching the development very carefully. The Irish government is concerned that the U.S. government is reaching into its territory. Meanwhile, Microsoft’s competitors are relishing the issue, knowing that it puts the company at a huge competitive disadvantage. European companies can, after all, use this situation as a reason why customers should avoid worldwide Microsoft email and cloud services.
The Irish government confirmed that it is closely watching these legal developments. “The Irish Government is aware of the case in question and is monitoring developments,” Ralph Victory, Press and Information Counsellor for the Embassy of Ireland in Washington, told eWEEK in an email.
Federal Court Ruling Orders Microsoft to Violate International Law
“The legal issues involved are complex and relate to U.S. and E.U. law as well as Irish law. They remain under examination by relevant Irish authorities and also at E.U. level.”
I suspect that part of the reason that the Irish government is waiting to see what happens before it does anything is that a great deal depends on what happens next in this case. However, Microsoft has just started gearing up the appeal process, and the Second Circuit Court hasn’t scheduled a hearing. While it’s likely that the court will schedule a hearing quickly, it’s anybody’s guess what the ultimate outcome will be.
It’s unlikely that the Second Circuit Court will be the final stop for this decision. No matter what the circuit court decides, it’s certain to be appealed to the U.S. Supreme Court. Whether the Court actually hears the case, assuming it is appealed, depends on whether it agrees there are important constitutional issues that need to be resolved.
“This case involves important questions of federal law,” said Miller Baker, a partner at McDermott Will and Emery, and an expert on the Supreme Court. “The issues are the kind that warrant Supreme Court review,” he said, including foreign relations and treaties.
Those important issues extend far beyond just the federal prosecutors’ desire to read some emails. If the government prevails and succeeds in gaining access to the emails on the Irish server, the consequences could be serious and long-lasting.
In addition to hurting U.S. companies’ ability to competitively engage in international trade, such a ruling would open U.S. companies to examination by foreign governments. The obvious possibilities could easily be such things as a warrant from a Chinese court to examine intellectual property and trade secrets at U.S. defense contractors.
Without a treaty to fall back on, U.S. companies would be prime pickings. The government would be powerless to even object, much less prevent such access simply because it would have authorized such things itself.
The obvious question then becomes, why is a federal prosecutor so hell-bent on getting these emails, when there’s already a perfectly legal means to go about getting it through proper channels? The reason the government gives is that using the existing process under mutual assistance treaties is “cumbersome.” But perhaps there’s a better, and more likely, explanation.
“Maybe they’re just lazy,” Baker said. If so, then the prosecutor appears to be finding out that a shortcut through the Constitution isn’t as easy as he thought.