US tech giants seek protection against overseas NSA snooping

In an epic battle of behemoths, Microsoft and four other US technology companies are seeking legal protection in a Manhattan court against US intelligence agencies, presently empowered to spy on millions of users’ data stored outside the country.

Some of the most reputable names in the tech business say revelations of the National Security Agency’s global spying network, leaked last summer by former NSA-contractor-turned-whistleblower Edward Snowden, could result in the loss of billions of dollars in business if overseas customers believe their files are vulnerable to US surveillance.

The arguments were submitted to a Manhattan district judge ahead of a July hearing to settle the matter, Reuters reported.

The latest legal action follows a court decision handed down in April that concluded it was legal for the government to order Microsoft to comply with a sealed search warrant for a customer email file that is stored in Dublin, Ireland. The judge ruled that the search warrant is a "hybrid” (which he described as “part search warrant and part subpoena"), saying that the recipient of a subpoena must produce information in its possession regardless – even if that data is stored outside of the United States.

The judge added that if territorial limitations on search warrants were moved to cyberspace, "the burden on the government would be substantial, and law enforcement efforts would be seriously impeded."

Now, a group of large tech firms, comprised of Verizon, Apple, AT&T and Cisco Systems are openly supporting Microsoft’s upcoming court battle against government snooping.

Lawyers for the companies, which provide internet services, as well as remote data storage (otherwise known as "cloud computing") say they suffered another setback in April when a Manhattan magistrate judge ruled on behalf of the government in its effort to make Microsoft comply with a search warrant for a customer email files, stored in Dublin, Ireland, AP reported.

Microsoft operates data centers around the world, including in the United States, Ireland, the Netherlands, Japan and Brazil.

The world’s largest software developer argued that the decision threatens the US Constitution's protections against illegal search and seizure, poses a risk to US foreign relations and "reduces the privacy protection of everyone on the planet."

"Over the course of the past year, Microsoft and other US technology companies have faced growing mistrust and concern about their ability to protect the privacy of personal information located outside the United States," Microsoft said in court documents. "The government's position in this case further erodes that trust, and will ultimately erode the leadership of US technology companies in the global market."

Prosecutors, meanwhile, said Microsoft’s position on the government’s ability to obtain communications in certain instances is a “dangerous impediment” to the authorities and their investigative work.

Microsoft's position "serves as a dangerous impediment to the ability of law enforcement to gather evidence of criminal activity," they said.

Meanwhile, the software giant, founded by Bill Gates and Paul Allen in 1975, said it has encountered "rising concerns among both current and potential customers overseas" and some customers have cited the ruling as they chose a foreign provider to store data.

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"If this trend continues, the US technology sector's business model of providing 'cloud' Internet-based services to enterprises, governments, and educational institutions worldwide will be substantially undermined," Microsoft said.

In court documents filed last week, Verizon said the ruling, if unchallenged, "would have an enormous detrimental impact on the international business of American companies, on international relations and on privacy."

It said the ruling "could cost US businesses billions of dollars in lost revenue, undermine international agreements and understandings, and prompt foreign governments to retaliate by forcing foreign affiliates of American companies to turn over the content of customer data stored in the United States."

In court papers, AT&T said the ruling threatened to provide law enforcement with "a global information access tool without bounds."

The Electronic Frontier Foundation, a civil liberties watchdog, said the government's intrusiveness “poses a grave risk to privacy."