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A shadow of a man using his mobile phone is cast near Microsoft logo at the 2014 Computex exhibition in Taipei June 4, 2014. Computex, the world A shadow of a man using his mobile phone is cast near Microsoft logo at the 2014 Computex exhibition in Taipei June 4, 2014. Computex, the world's second largest computer show, runs from June 3 to 7. REUTERS/Pichi Chuang (TAIWAN - Tags: BUSINESS LOGO SCIENCE TECHNOLOGY) - RTR3S3OQ  

Obama Administration Claims Right To Access U.S. Company Data Stored Overseas

Giuseppe Macri
Tech Editor

The United States Department of Justice is attempting to force Washington-based Microsoft Corp. to turn over data stored on servers in Dublin, Ireland, in a case that could drastically expand federal power over data privacy.

President Barack Obama’s administration is drawing on Reagan-era legislation in order to justify warrants for data held by U.S. companies outside of U.S. territory — warrants which Microsoft, Apple, Cisco and others argue are unenforceable beyond U.S. borders. Microsoft and others commonly store customer data on servers physically closest to account holders.

“Overseas records must be disclosed domestically when a valid subpoena, order, or warrant compels their production,” the government said in a brief filed last week according to Ars Technica. “The disclosure of records under such circumstances has never been considered tantamount to a physical search under Fourth Amendment principles, and Microsoft is mistaken to argue that the SCA provides for an overseas search here.”

“As there is no overseas search or seizure, Microsoft’s reliance on principles of extra-territoriality and comity falls wide of the mark.”

Microsoft argues that the case threatens to drastically erode public trust which has already deteriorated in the wake of National Security Agency bulk electronic surveillance programs leaked by former intelligence contractor Edward Snowden, and if pursued, could “erode the leadership of U.S. technologies in the global market.”

“Congress has not authorized the issuance of warrants that reach outside US territory,” Microsoft attorneys wrote in a brief to a New York district court obtained by the Washington Post. “The government cannot seek and a court cannot issue a warrant allowing federal agents to break down the doors of Microsoft’s Dublin facility.”

Service providers AT&T and Verizon agree, the latter stating that letting the government “obtain, in a manner contrary to both U.S. and foreign law, customer data stored abroad” would “have an enormous detrimental impact on the international business of American companies, on international relations, and on privacy,” and go far beyond email storage.

“Verizon subsidiaries operate “cloud” storage services internationally, which allow business customers in other countries to store their data on servers located abroad,” the company wrote in a statement to the court obtained by Ars. “While Verizon complies with lawful government demands for information, the extraordinary reach of the demand here raises serious questions about its legitimacy.”

Apple and Cisco made similar arguments, and alleged the government should pursue treaties with foreign governments in order to obtain such data legally.

The Justice Department said such solutions are impractical, and that expanded beyond-border jurisdiction is needed in a world where ”electronic communications are used extensively by criminals of all types in the United States and abroad, from fraudsters to hackers to drug dealers, in furtherance of violations of U.S. law.”

The e-mail data the government is seeking relates to a drug-trafficking investigation. A New York district judge sided with the government in April, and the case has been appealed to a federal court for a July 31 hearing.

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