Recap: Oral Arguments in United States v. Microsoft Corp.
By Behnam Dayanim, Robert Silvers, and Edward George
On Tuesday, February 27, the Supreme Court heard oral arguments on
Microsoft argued that the SCA cannot compel the disclosure of emails stored in Ireland because it would be an extraterritorial application of the statute. The U.S. Government, on the other hand, argued that compliance with the statute and court order is not an extraterritorial application but is “classically domestic behavior” because the SCA only compels action by a United States person in the United States. That person is able to access the data without leaving or taking any action elsewhere.
At oral arguments, two issues clearly emerged that will likely play a deciding role in the case.
Territoriality v. Extraterritoriality
One issue that kept reappearing throughout oral argument was whether a court order requiring conduct in the United States that will extract data from elsewhere (in this case, Ireland) is an extraterritorial application of the SCA. Justice Kennedy elicited from the Government an acknowledgment that the SCA does not have extraterritorial application, but the Government argued that when a party is properly before a U.S. court and a court issues an order to that party to produce information, the required conduct is domestic, not international.
Justices Ginsburg and Sotomayor pointed out that while the conduct may be occurring within the United States, something still has to occur abroad – namely, the computers in Ireland storing the emails have to transmit these e-mails back to the United States, implicating some conduct in a foreign country. Justice Gorsuch further reinforced that observation, noting that the Government’s preferred focus on the act of disclosing the data – which occurs in the United States – ignores the fact that the data were collected and transmitted from abroad to the United States in the first instance.
Justice Breyer suggested a middle ground between the two parties’ positions – positing that the court might need to evaluate factors of comity and weigh the foreign implications of an order to produce data stored abroad. He noted that one bill currently pending before Congress, the
Technology v. Statute
The Justices’ frustration surrounding the issue of territoriality v. extraterritoriality appeared rooted in the age of the statute. Justice Ginsburg, echoed by Justice Sotomayor, suggested that it might be advisable for the Court to construe the statute narrowly and defer to Congress, as the legislature is better equipped to evaluate and appropriately balance the various interests. However, Justice Alito, who in
Reading The Tea Leaves
Predicting how the Supreme Court will decide a case based on oral arguments is always perilous; nonetheless, it does seem as if the Court may be leaning in favor of the Government, at least in part, and we would not be surprised to see the Court embrace an approach that authorizes the production of these types of data, subject to considerations of comity, as suggested by Chief Justice Roberts and Justice Breyer.
In the interim, companies faced with this situation should: Consult with outside counsel about the scope of the court order. Some court orders may be overly broad, burdensome or ambiguous, which may allow bases to object.Others may implicate important public policy concerns in foreign jurisdictions, implicating the sorts of comity concerns that a court might find compelling.
Check the precedent in your jurisdiction. Court decisions differ, and nuances may matter. Although no court outside the Second Circuit has adopted its position, there nonetheless may be elements in other courts’ decisions that might be useful in determining whether to object to an order.