Microsoft Corp. on Thursday sued the Justice Department to overturn a federal law that prevents the technology giant from telling thousands of customers when their information has been sought by federal agents.

The lawsuit represents the latest salvo in the fight between technology companies and law enforcement agencies over the privacy of customer data, a fight most recently waged by Apple Inc. over the FBI’s effort to unlock a terrorist’s iPhone.

It also highlights the complex legal issues emerging in federal probes of terrorism and other crimes in the age of cloud computing, which allows consumers and businesses to store vast amounts of personal information on remote servers.

At issue in Microsoft’s suit, filed in the U.S. District Court in Seattle, is a 1986 law that permits federal judges to bar companies from telling customers that the government is seeking their information. Under the statute, the prohibition is allowed when the government has “reason to believe” disclosure would hinder its investigation.


Microsoft contends the law is being abused, and violates its 1st Amendment right to free speech and its customers’ 4th Amendment rights to be protected from unreasonable searches and seizures.

“Microsoft brings this case because its customers have a right to know when the government obtains a warrant to read their emails, and because Microsoft has a right to tell them,” the suit reads.

Nearly half of the 5,624 federal demands for customer information that Microsoft has received in the last 18 months have been accompanied by secrecy orders, in many cases for unlimited periods of time, the company said.

The government has “exploited the transition to cloud computing as a means of expanding its power to conduct secret investigations,” the lawsuit says. “As individuals have moved their most sensitive information to the cloud, the government has increasingly adopted the tactic of obtaining the private digital documents of cloud customers not from the customers themselves, but through legal processes directed at online cloud providers.”


Emily Pierce, a Justice Department spokesperson, declined to comment.

Brad Smith, Microsoft’s chief legal officer, said in a blog post that “it’s becoming routine for the U.S. government to issue orders that require email providers to keep these types of legal demands secret. We believe that this goes too far and we are asking the courts to address the situation.”

The suit comes just weeks after the Justice Department dropped its effort to compel Apple to write software to help it unlock the iPhone used by Syed Rizwan Farook, who along with his wife launched a Dec. 2 attack in San Bernardino that left 14 dead and many others wounded.

The FBI could not unlock the encrypted phone and won an order from a federal judge requiring Apple to write the necessary code to help it gain access to the device. Apple vigorously sought to overturn that ruling and had been joined by a number of technology companies in its court battle. The Justice Department dropped the case when an unidentified third party managed to successfully unlock the phone.


The FBI has not publicly disclosed what was contained on Farook’s iPhone, but a source familiar with the investigation confirmed a CBS News account that investigators had not recovered anything significant.

Meanwhile, the Justice Department is seeking to overturn another judge’s ruling that blocked its efforts to compel Apple to unlock an iPhone in a New York drug case.

Whereas those disputes were about the government’s right to force Apple to help it retrieve data, Microsoft is seeking permission to alert customers to such government requests.

Though Microsoft has taken aim at the government before, the latest move could reflect a new confidence in the tech industry to challenge court orders in the wake of the San Bernardino dispute. Some in Silicon Valley had feared the public would turn against Apple for not helping access cellphone data belonging to a mass shooter. But public opinion polls showed a significant divide.


In the suit, Microsoft noted that not long ago people and businesses stored their most sensitive information in filing cabinets and drawers, and later, on hard drives in their homes or offices. When the government conducted raids to obtain such information, the owners of that data and information almost always were aware that the searches had taken place.

With the recent massive migration of data to the cloud and servers in others’ possession, the government has increasingly relied on the Electronic Communications Privacy Act to gag Microsoft and other companies from disclosing information about the warrants. In many instances, the gag orders last for “unreasonably long (or even unlimited) periods of time,” Microsoft wrote.

Microsoft’s complaint is reminiscent of another dispute between the federal government and Twitter, the giant social media company. Twitter is suing the Justice Department for the right to disclose the precise number of national security letters it receives from the FBI and the number of orders it receives from the ultra-secret Foreign Intelligence Surveillance Court.

The Justice Department told Twitter that such data were classified and could not be released. The company argued in its October 2014 lawsuit that such a prohibition forces it to either “engage in speech that has been preapproved by government officials or else to refrain from speaking altogether.”


Twitter took the legal action, which remains ongoing, about eight months after five other technology companies, including Microsoft, Google Inc. and Facebook reached a compromise permitting them to publish rough estimates of the number of such requests.

Staff Writer Paresh Dave in Los Angeles contributed to this report.

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