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Justices to Hear DOJ Appeal on Microsoft Ruling: Is Email Stored Abroad Subject to a U.S. Warrant?

The Supreme Court is poised to finally answer the question that’s been plaguing federal courts across the country:  must U.S. tech companies comply with warrants issued under the Stored Communications Act (“SCA”) that demand information from customer accounts that is stored on servers in a foreign country?

We’ve written several times about the seminal Microsoft litigation.  It started in December 2013, when U.S. law enforcement officials served an SCA warrant on Microsoft seeking email content associated with an unnamed user’s msn.com account.  Microsoft agreed to turn over the customer’s “address book” because it was stored on U.S. servers. But Microsoft moved to quash the warrant with respect to the contents of the customer’s emails, which were stored on a server in Ireland.  Microsoft argued that, in order to access customer emails and records stored on Irish servers, the government should be obliged to pursue traditional bilateral law enforcement and diplomatic channels such as the Mutual Legal Assistance Treaties and other traditional mechanisms of international cooperation among law enforcement entities.  Microsoft failed to convince Magistrate Judge James Francis or U.S. District Judge Loretta Preska, both of whom ordered Microsoft to comply with the warrant.

Microsoft had a more sympathetic audience with the U.S. Court of Appeals for the Second Circuit.  The appeals panel held that, since Congress did not intend the SCA’s warrant provision to apply extraterritorially, emails stored on a server in Ireland were off limits. 

The government then sought rehearing before the full Second Circuit.  In a deeply divided 4–4 ruling, the court denied rehearing en banc.  But all four dissenting judges issued written dissents from the denial—and lower courts in other jurisdictions have found these dissents persuasive.

After Microsoft, the cases around the country have gone against tech companies in favor of the government.  For example, we’ve been covering the ongoing dispute between Google and the U.S. Attorney for the Northern District of California.  There, the district judge found the Microsoft majority’s decision unpersuasive and, relying on the dissenters’ rationale, sided with the government

And an interesting technology wrinkle has surfaced in the post-Microsoft decisions.  Different technologies are used by Microsoft and Google for transmission and storage of data.  Microsoft has long used a more static technology, storing customer email in data centers located near its customer.  But Google and other internet service providers use more dynamic technology that slices and dices bytes of data and constantly moves the data around their vast networks to create operational efficiencies.  This, of course, raises a much broader question of where digital data lives—if anywhere.  We’ll see if this issue enters into the Supreme Court briefing.

But for now, the justices may have decided that it’s time for a consistent nationwide answer regarding the permissible reach of the SCA.  It remains to be seen whether the Court’s move will have any effect on efforts to update the SCA legislatively.  We’ll continue monitoring this area of the law for developments.