Microsoft Wins Appeal in Dublin Datacenter Warrant Case

A federal appeals court today overturned a lower court ruling ordering Microsoft to turn over the contents of e-mails stored in an offshore datacenter. The decision is a major victory for Microsoft and all major cloud and data services providers seeking to ensure user data is protected under the laws of the countries where information is stored.

The closely watched case centered around Microsoft's refusal to comply with a search warrant by U.S. law enforcement demanding that it turn over the contents of specific e-mails residing in its Dublin, Ireland datacenter in connection with a criminal investigation. While Microsoft did turn over the data in its U.S. datacenters, the company argued that complying with the search warrant's demand to provde the e-mails was beyond the scope of U.S. law. Despite support from Apple, AT&T, Cisco and Verizon, along with the Electronic Frontier Foundation, the U.S. District Court for the Southern District of New York upheld the search warrant issued nearly two years ago. Microsoft subsequently filed the appeal last year arguing privacy laws superseded the court's ruling. "This case is about how we best protect privacy, ensure that governments keep people safe and respect national sovereignty while preserving the global nature of the Internet," Microsoft President and Chief Legal Officer Brad Smith stated at the time.

Smith hailed today's decision as a key precedent for privacy. "It ensures that people's privacy rights are protected by the laws of their own countries; it helps ensure that the legal protections of the physical world apply in the digital domain; and it paves the way for better solutions to address both privacy and law enforcement needs," Smith stated in a blog post.

A panel of three appeals court judges from the U.S. Court of Appeals for the Second Circuit found that last year's ruling ordering Microsoft to comply with a search warrant was invalid, noting that search warrants carried out by U.S. law enforcements are typically limited to locations within this country's borders or locations it has jurisdiction over, according to the ruling. Warrants don't traditionally extend further.

"Because Microsoft has complied with the Warrant's domestic directives and resisted only its extraterritorial aspects, we REVERSE the District Court's denial of Microsoft's motion to quash, VACATE its finding of civil contempt, and REMAND the cause with instructions to the District Court to quash the Warrant insofar as it directs Microsoft to collect, import, and produce to the government customer content stored outside the United States, according to the ruling.

Smith yesterday gave a speech at Microsoft's Worldwide Partner Conference in Toronto where he gave an impassioned emphasis on the company's commitment to fighting for customer privacy and spoke to this closely watched case. "We need an Internet that respects people's rights," he said. "We need an Internet that is governed by law [and] we need an Internet that's governed by good law."

Smith has been a vocal proponent that the Communications Storage Act under the Electronic Privacy Act of 1986 is based on is dated and has urged Congress and the White House to create laws that are consistent with the modern world. Apparently the appeals court agreed as noted in the ruling:  "Three decades ago, international boundaries were not so routinely crossed as they are today, when service providers rely on worldwide networks of hardware to satisfy users' 21st–century demands for access and speed and their related, evolving expectations of privacy."

Posted by Jeffrey Schwartz on 07/14/2016 at 1:50 PM