Microsoft accepts ‘contempt of court’ deal to appeal email privacy case

Out-Law News | 10 Sep 2014 | 4:09 pm | 1 min. read

Microsoft Corp and the US government have reached a deal under which Microsoft has agreed to be held in contempt of court, as a procedural measure to move an email privacy case on to appeal.

The agreement is the latest step in an ongoing legal battle, in which Microsoft is fighting moves by the US government that would force the corporation to hand over a customer’s emails stored in a data centre in Ireland.

On 31 July 2014, US district court judge Loretta Preska ruled that a warrant obtained by the US government did lawfully require Microsoft to hand over any data it controlled, regardless of where it was stored.

Microsoft chose not to comply with Preska’s ruling. The corporation refused to hand over the emails and said it would appeal. The US government said the corporation’s refusal to comply with the ruling meant it should be held in contempt of court.

However, according to a deal outlined in court documents filed on 8 September, both sides agreed that “contempt sanctions need not be imposed at this time” as Microsoft seeks to appeal. Nevertheless, the US government said it reserved the “right to seek sanctions”, in addition to the contempt order, in the case of “materially changed circumstances in the underlying investigation” or if an appeal upholds judge Preska’s ruling and “Microsoft continues not to comply with it”.

Preska had upheld a ruling by US magistrate judge James Francis on 25 April, when Francis also denied Microsoft’s attempt to quash the warrant. Francis confirmed that it was he who had granted the warrant in question, on 4 December 2013. The warrant authorised the search and seizure of information “associated with a specified web-based email account that is stored at premises owned, maintained, controlled or operated by Microsoft Corporation”.

The court documents in relation to the warrant said: “It is the responsibility of Microsoft’s global criminal compliance (GCC) team to respond to a search warrant seeking stored electronic information. Working from offices in California and Washington, the GCC team uses a database programme or ‘tool’ to collect the data... initially a GCC team member uses the tool to determine where the data for the target account is stored and then collects the information remotely from the server where the data is located, whether in the United States or elsewhere.”

However, Microsoft executive vice-president and general counsel Brad Smith said the corporation would take the case to appeal and “continue to advocate that people’s email deserves strong privacy protection in the US and around the world”.