This decision was eagerly awaited following Microsoft's appeal against the search warrant ordering it to provide the contents of a non-US customer's email account hosted in Ireland. 

In December 2013, at the request of federal prosecutors, a US federal judge issued a search warrant under section 2703(a) of the SCA (Stored Communications Act), ordering Microsoft to provide the contents of the said account.

For the record, the SCA was adopted in the USA as part of the Electronic Communications Privacy Act of 1986. It prohibits Internet service providers from disclosing the content of e-mails and other stored communications, subject to certain strictly defined exceptions.

In April 2014, Microsoft unsuccessfully sought to have the warrant cancelled by the magistrate who had authorised it.

According to the US Government, there was no extraterritoriality issue in this case because the warrant was served on Microsoft in the US to retrieve account data from its offices in the US.

The Federal Court of Appeal for the Second District did not follow him and, in a decision dated 14 July 2016, has just prohibited the US Government from seizing the contents of email accounts stored outside the USA (Case No. 14-2985 - 2d Circuit July 14, 2016).

The Court recalled that while the SCA prescribes the methods by which the government may obtain access to information for law enforcement purposes, it does so in strict compliance with the protection of user content, in the context of new technologies that require interaction between the user and the service provided. It concludes that an SCA search warrant can only reach data stored within the territorial limits of the United States.

This decision is not final in the sense that it may be appealed to the Supreme Court or overturned by a Federal Court other than the Second Circuit. But it is a milestone in the legal battle being waged by US Cloud solution providers against US government practices and for the protection of privacy that is so dear to European market players.