Top Court to Hear Microsoft Warrant Case -- WSJ

By Brent Kendall Features Dow Jones Newswires

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (October 17, 2017).

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WASHINGTON -- The U.S. Supreme Court on Monday agreed to decide whether email providers have to comply with search warrants seeking customer messages if the material is stored outside the U.S., the latest clash between technology companies and the government over access to private data.

The case, which centers on a battle between the federal government and Microsoft Corp., is part of a broader tussle between tech firms and law enforcement over consumers' digital information. It also comes at a time with the high court is becoming more active in considering privacy rights and public safety in the digital age.

The new case adds to a blockbuster docket in which the justices already were preparing to hear a separate case on whether authorities need search warrants for data showing the location of cellphone users.

In the email case, the government in 2013 applied for a search warrant requiring Redmond, Wash.-based Microsoft to turn over email information for a customer who allegedly was using the account to conduct criminal drug activity. A magistrate judge issued the warrant.

Microsoft handed over some account-identification information that was stored in its facilities in the U.S., but it declined to turn over actual email messages, which it said were stored at a data center in Ireland. The company argued that U.S. search warrants don't reach data stored outside domestic borders.

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The case made its way to the Second U.S. Circuit Court of Appeals in New York, where a three-judge panel dealt a blow to the Justice Department by ruling for Microsoft last year. The court held that U.S. law doesn't authorize courts to enforce search warrants against U.S.-based companies for emails that reside on foreign computer servers.

The Supreme Court will review that ruling. The case likely will be argued in early 2018, with a decision expected by the end of next June.

The Justice Department appealed the case to the high court, saying the lower court decision has produced ripple effects, with Google and other technology companies putting up resistance similar to Microsoft's.

"Under this opinion, hundreds if not thousands of investigations of crimes -- ranging from terrorism, to child pornography, to fraud -- are being or will be hampered by the government's inability to obtain electronic evidence," the department said in a court brief.

A group of 33 states filed a separate brief supporting the Justice Department, saying the lower court decision also was interfering with local and state law enforcement investigations.

Microsoft said that if changes need to be made to the law, those should come from Congress, which could balance the needs of law enforcement with the needs of technology companies.

If the U.S. can seek this overseas data, it can place companies in a difficult spot when trying to comply with foreign privacy laws, Microsoft said in court papers. It also said that, given customers' concerns about their privacy rights, granting law enforcement authorities the broad power to obtain data stored overseas "would hamstring U.S. companies' ability to compete in the multi-billion dollar cloud-computing industry."

Law enforcement access to data stored overseas is just one of several major issues that currently pit the government against U.S. tech firms.

On another front, a top Justice Department official last week signaled the government plans a more aggressive posture in seeking access to encrypted information from tech companies. Deputy Attorney General Rod Rosenstein said negotiations with tech firms haven't worked.

Write to Brent Kendall at brent.kendall@wsj.com

(END) Dow Jones Newswires

October 17, 2017 02:47 ET (06:47 GMT)