Supreme Court sticks to the sidelines in DoJ-Microsoft dispute

CLOUD Act raises crucial questions about overseas data that court fails to answer

The US Supreme Court has decided to drop a test case between Microsoft and the Department of Justice (DoJ), leaving a serious legal question about the reach of America's Courts in the digital world.

In a case that had started in 2013, Microsoft refused to hand over emails stored in severs at the company's data centre in Dublin that were subject to a warrant over a criminal investigation into alleged drug trafficking.

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After decisions both in favour and against each party made in various courts, the case came to the Supreme Court to decide once and for all. But the Justices decided on Monday that the case was moot because of the new CLOUD Act passed into law by Congress last month.

The Clarifying Lawful Overseas Use of Data (CLOUD) Act states that US companies are obliged to provide access to all content - whether held on a server in the US or outside the country - if they are issued with a warrant, but can reject such demands if they conflict with foreign laws, such as data protection legislation.

The DoJ immediately issued a new warrant to Microsoft in light of the law, which readily handed over the data, and both parties asked the Supreme Court to close the case, as no live dispute remained.

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However, by closing the case, the Supreme Court avoided weighing in on the legal question of whether a company could refuse to comply with such a warrant due to it contradicting the local law where the data is stored.

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After the Act had passed, US Senator Ron Wyden questioned the legitimacy of the bill given its rush through Congress, with the legislation attached to a huge spending bill document.

"This bill contains only toothless provisions on human rights that Trump's cronies can meet by merely checking a box. It is legislative malpractice that Congress, without a minute of Senate debate, is rushing through the CLOUD Act on this must-pass spending bill," he said.

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