The Justice Department has decided not to ask the Supreme Court to review a controversial federal appeals court decision that said employees may not be prosecuted under a federal anti-hacking statute for simply violating their employer's computer use policy.

The 9-2 decision in April by the 9th U.S. Circuit Court of Appeals dealt a blow to the Obama administration, which is invoking the same theory to prosecute alleged WikiLeaks leaker Bradley Manning.

The case concerns the Computer Fraud and Abuse Act, which was passed in 1984 to enhance the government's ability to prosecute hackers who accessed computers to steal information or to disrupt or destroy computer functionality.

At least, that's what the San Francisco-based appeals court said was the act's purpose.

The government, however, has interpreted the anti-hacking provisions to include activities such as violating a website's terms of service or a company's computer usage policy, a position the court ruled means "millions of unsuspecting individuals would find that they are engaging in criminal conduct." The court said that violations of employee contract agreements and websites' terms of service were better left to civil lawsuits.

"Under the government's proposed interpretation of the CFAA, posting for sale an item prohibited by Craigslist's policy, or describing yourself as 'tall, dark and handsome,' when you are actually short and homely, will earn you a handsome orange jumpsuit," Judge Alex Kozinski wrote for the majority, adding in a footnote that the government's interpretation of the law opens employees up to be arrested, not merely fired, for playing Farmville at work.

The act makes it a federal offense if one "knowingly and with intent to defraud, accesses a protected computer without authorization, or exceeds authorized access, and by means of such conduct furthers the intended fraud and obtains anything of value, unless the object of the fraud and the thing obtained consists only of the use of the computer and the value of such use is not more than $5,000 in any 1-year period."

Orin Kerr, a George Washington University Law School scholar and considered one of the leading experts on the topic, suggested the government did not appeal because it "may have been scared off by Judge Kozinski's opinion."

"It would have been the first document that the justices read, and it's a pretty powerful brief against the government's position," he said.

The Justice Department did not immediately respond to comment on its decision not to appeal. (.pdf)

The case before the appeals court concerned an appeal by defendant David Nosal, who had worked for an executive search firm and was charged with, among other crimes, three CFAA counts for allegedly aiding and abetting his former colleagues to supply him with company data that his co-workers were authorized to access but forbidden to divulge. The decision by the nation's largest federal appeals court, which covers the western United States, reversed the same circuit's 2-1 ruling last year that said no hacking was required to be prosecuted as a hacker under the CFAA.

The 9th Circuit covers Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon and Washington.

The outcome conflicts with at least three other circuit courts of appeal nationwide. Had the government appealed, the Supreme Court likely would have taken the case to clear up the conflicts. But so far, the Supreme Court remains sidelined on the issue.

Accused WikiLeaks leaker Manning is charged with, among other things, breaching the CFAA by allegedly exceeding his authorized access of a government computer and providing files to secret-spilling site WikiLeaks. The prosecution doesn't allege, however, that Manning actually broke into any computer system. But Manning is being prosecuted at Ft. Meade in Maryland, outside the reach of the 9th Circuit's decision.

The statute was used to prosecute Lori Drew, who was charged criminally for participating in a MySpace cyberbullying scheme against a 13-year-old Missouri girl who later committed suicide. The Los Angeles federal court case against Drew hinged on the government's argument that violating MySpace's terms of service was the legal equivalent of computer hacking and a violation of the CFAA. A federal judge who presided over the prosecution tossed the guilty verdicts in July 2009, and the government declined to appeal.

However, the feds used the same theory to get hacking convictions of two New Jersey men who used computer scripts to help them buy, with real money, lots of concert tickets from Ticketmaster.com, which they later scalped.

But the appeals court plainly said breaking company computer-use policies does not amount to hacking.

Minds have wandered since the beginning of time and the computer gives employees new ways to procrastinate, by gchatting with friends, playing games, shopping or watching sports highlights. Such activities are routinely prohibited by many computer-use policies, although employees are seldom disciplined for occasional use of work computers for personal purposes. Nevertheless, under the broad interpretation of the CFAA, such minor dalliances would become federal crimes. While it’s unlikely that you’ll be prosecuted for watching Reason. TV on your work computer, you could be. Employers wanting to rid themselves of troublesome employees without following proper procedures could threaten to report them to the FBI unless they quit.

Kozinski was joined by Judges Harry Pregerson, M. Margaret McKeown, Kim McLane Wardlaw, Ronald M. Gould, Richard A. Paez, Richard R. Clifton, Jay S. Bybee and Mary Murguia.

In dissent, Judge Barry Silverman, joined by Richard C. Tallman, wrote: "In ridiculing scenarios not remotely presented by this case, the majority does a good job of knocking down straw men — far-fetched hypotheticals involving neither theft nor intentional fraudulent conduct, but innocuous violations of office policy. The majority also takes a plainly written statute and parses it in a hyper-complicated way that distorts the obvious intent of Congress. No other circuit that has considered this statute finds the problems that the majority does."

While Nosal, the defendant in the case, escaped the hacking charges, he is also accused of trade secret theft, mail fraud and other charges. Trial is pending in San Francisco federal court.