Microsoft lost its appeal against a United States government warrant, in a ruling that forces the tech company to hand over data stored by the company overseas.
The ruling has pushed a new debate forward over user data privacy, which has come to light over the past 18 months since whistleblower Edward Snowden revealed a massive surveillance project by the National Security Agency.
The latest ruling is a blow for privacy, as American authorities had demanded Microsoft turn over email data that was being stored in Ireland. The case has seen much media attention as well as witnessing a number of rivals, including Cisco and Apple, file a joint amicus brief in support of Microsoft.
Microsoft will appeal and won't be handing over any personal data in the near future.
Analysts and observers have also lashed out over the judge presiding on the case. One report suggests that the judge referred to Microsoft as an ISP, even though it is not, as well as discussing Microsoft as a California-based company. It is based in Washington state.
Almost all companies who deal with the Internet, including Internet service providers, have criticized the ruling.
In June, Tech Times reported that Microsoft would refuse to hand over the email data stored in Ireland. The move even prompted concerns that the company could face legal action for refusing to assist in an investigation. But the company has remained stalwart in its refusal to deliver the personal emails to the American government.
Microsoft argues that if it were to deliver the data it would be setting a precedent that the government can reach beyond borders and grab personal information of private foreign individuals and businesses, which would result in the international community leaving Microsoft's email service for other providers.
"If the government's position prevails, it would have huge detrimental impacts on American cloud companies that do business abroad,'' said Michael Vatis, a lawyer who co-authored a friend-of-the-court brief for Verizon in June. Verizon also operates data centers overseas.
AT&T also chimed in to show its support for Microsoft's efforts.
"There is nothing more critical than protecting the privacy and information of every single AT&T customer -- no matter the country in which they reside," said Wayne Watts, AT&T senior executive vice president and general counsel, in a statement. "That's why we're extremely disappointed with today's U.S. District court decision in favor of the U.S. government's extraterritorial search warrant. We will strongly support Microsoft's pursuit of a stay and subsequently a successful appeal of this decision."