Last week, the Supreme Court heard oral arguments in the United States v. Microsoft Corp. case (previously discussed here). As a quick refresher, the crux of this dispute requires the Court to determine whether Congress intended for the Stored Communications Act's ("SCA") warrant provisions to reach data that is stored abroad or whether that would have an impermissible extraterritorial reach. The government began the oral arguments by pointing out that the focus of Section 2703 of the SCA is on disclosure, thus making the warrant at issue a permissible application of the statute. Microsoft, on the other hand, argued that the focus is on the security of stored communications and therefore, it is the storage of the data that matters in making this an extraterroritoral act.

An interesting theme that came up throughout the oral arguments was whether the Court is the right body to interpret a statute that was enacted in 1986. Justices Breyer and Roberts seemed reluctant to find that the Court is unsuited to resolving the case before it, as the Court has the ability pursuant to the Aerospatiale standards to deal with any comity or sovereignty concerns where necessary. Meanwhile, Justices Ginsburg and Sotomayor suggested this issue may be better left to Congress to resolve through new legislation so that all ofa the nuances and varying interests of both sides can be taken into account. Justice Ginsburg expressed concerns about interpreting a statute that was enacted long before cloud computing was invented.

If the CLOUD Act, a recent bill supported by a bipartisan group of senators, is passed before the Court decides the issue, it will moot the case and Microsoft would be required to turn over the data. The CLOUD Act makes clear that the SCA would apply to data stored abroad while also providing a mechanism for providers like Microsoft to challenge the requests if they conflict with the foreign laws where the data is stored. The proposed legislation further provides a mechanism for the US government to enter into modern bilateral agreements, that must meet the statutory privacy and security protections, to set standards for cross border investigative requests with other nations.

It will be very interesting to see how the Court will weigh in on the varying interests and concerns if the bill is not passed. If you are interested in reading the entire transcript of the oral argument, check it out here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.