Solicitor General Noel Francisco filed with the Court to dismiss the case, and Microsoft also agreed to that action in a separate filing. Today the justices threw out a ruling by the U.S. Court of Appeals for the 2nd Circuit, explaining that the case had become moot. American law enforcement sought data on a user of Microsoft services in relation to a drug trafficking case; Microsoft said that the data in question was located exclusively in a datacenter in Ireland, and as such they must work out access with Irish authorities.
During arguments in February, however, Justice Sonia Sotomayor asked why the justices shouldn't just wait for Congress to resolve the issue, given the pending legislation. The Cloud Act, as it's known, makes clear that US warrants apply around the world and clarifies what data the government can access.
Microsoft President and Chief Legal Officer Brad Smith has said Microsoft backed The CLOUD Act because it sets the stage for governments to establish the global agreements between them to establish a framework for these kinds of cases. It gives tech companies an easier way to navigate conflicts between government demands and customer privacy expectations. Microsoft officials said they are reviewing the new DOJ warrant before deciding how to proceed.
The Justice Department and Microsoft both supported the new measure, the Clarifying Lawful Overseas Use of Data Act.
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Under the new CLOUD Act, the company could challenge the warrant on grounds of comity, possibly generating further litigation.
For decades, foreign governments requesting information from a US company would have to work through diplomatic procedures known as MLATs, short for mutual legal assistance treaties.
Microsoft shares are up 2.2% to $96.23. Moreover, it would allow countries to wiretap on USA soil for the first time, including conversations that foreign targets may have with people in the US, without complying with Wiretap Act requirements.