The Supreme Court recently granted certiorari in U.S. v. Microsoft, a case that will examine the extraterritorial reach of the Stored Communications Act (SCA), and thus whether warrants in criminal cases seeking information under the SCA apply outside of the United States.1

In 2013, the federal government served Microsoft at its U.S. headquarters with a warrant, properly supported by probable cause.2 The warrant asked for, among other things, the contents of emails sent and received from a particular account, the holder of which was believed to be involved in criminal drug trafficking.3 Microsoft complied with the warrant to the extent of data stored on its U.S. servers, but refused to turn over requested data that was stored on servers in Ireland.4 Microsoft contended that the SCA, from which the government gets its authority to request electronically stored information with warrants, did not apply to information stored abroad.5

The SCA makes no mention of whether its authority extends beyond the U.S. borders.6 Further, it has long been the presumption of American law that “legislation of Congress, unless a contrary intent appears, is meant to apply only within the territorial jurisdiction of the United States.”7 The district court held Microsoft in contempt for not fully complying with the warrant, but the Second Circuit refused to enforce the warrant.8

The stakes are enormously high, so how the Justices might rule is of immense interest; a decision for Microsoft could mean that all U.S. companies need to do to avoid disclosure of electronically-stored information required pursuant to a valid warrant in criminal investigations is store that data abroad.9  An eventual opinion will likely be more carefully worded to prevent that outcome, and possibly encourage Congressional intervention to account for changes in technology that have made the application of old law to modern technology issues an all-too-common problem for courts as of late.10

In assessing whether a statute reaches extraterritorially, the Court applies a two-step analysis: (1) whether there was a clear indication of congressional intent to have the statute apply extraterritorially, thereby rebutting the presumption against extraterritoriality; and (2) If there is no such clear indication, whether the case involves a domestic application of the statute.11

There is not a clear indication of congressional intent to have the SCA apply extraterritorially.12 The Second Circuit, in refusing to enforce the warrant, explained that neither the plain meaning of the SCA nor the statute’s references to warrants deriving from the Fourth Amendment can be construed to give a clear indication of extraterritorial application.13 The Second Circuit further concluded that the SCA focuses on privacy, and thus the relevant conduct is where the private information will be seized.14 As such, the warrant was not enforceable because the information will be seized in Ireland, and the warrant cannot apply extraterritorially.

The Court is unlikely to disagree with the first part of the analysis; however, it may overrule the analysis under the second part of the test. In the second step, the Court looks to the focus of the statute in question, and determines whether the conduct at issue in the case occurred in the United States.15 If the conduct did occur in the United States, then, despite other activity that might have occurred abroad, the statute will apply.16

In the Second Circuit, Microsoft contended that because the statute’s focus is privacy,  the conduct to look at is where the private data is stored.17 The government contends the relevant conduct is where the point of access is for the required data disclosure —the U.S.—regardless of where the data is stored.18 The SCA’s legislative history seems to indicate that the statute’s focus is indeed privacy,19 as Microsoft contends.20 Textualists are unlikely to put emphasis on the legislative history, but the degree to which other Justices might rely on it varies.21

Justice Neil Gorsuch is the most recent addition to the Court, but does not change the calculus much. Where the late Justice Scalia often sided with Justices Ginsburg, Breyer, Sotomayor, and Kagan in restricting searches and seizures,22 Gorsuch is also likely to be a stand-in for his predecessor; Gorsuch has expressed opinions against “intrusive” government searches and seizures as a judge on the U.S. Court of Appeals for the Tenth Circuit.23 This, combined with the tendency of the liberal justices to rule against expansive use of searches and seizures,24 could bode well for Microsoft.

The extraterritoriality application of a warrant is clearly an issue of interest for the Court; it granted certiorari to the case in absence of a circuit split, which is usually an unofficial requirement for Supreme Court review.25

The case has yet to be scheduled for oral argument.26 It remains to be seen whether data stored abroad really is out of sight and out of reach, or if warrants under the SCA come with a long foreign-reaching arm.