Appeals court takes dim view of Net-tapping rules

Panel suggests FCC can't order wiretapping backdoors for ISPs, but Net phone companies may be covered.

Declan McCullagh Former Senior Writer
Declan McCullagh is the chief political correspondent for CNET. You can e-mail him or follow him on Twitter as declanm. Declan previously was a reporter for Time and the Washington bureau chief for Wired and wrote the Taking Liberties section and Other People's Money column for CBS News' Web site.
Declan McCullagh
3 min read
WASHINGTON--A federal appeals court suggested on Friday that government regulations levying extensive Internet wiretapping requirements on universities and libraries may go too far.

The U.S. Court of Appeals here sharply questioned whether the Federal Communications Commission exceeded its legal authority last year when it ordered "any type of broadband Internet access service" and many Net phone services to rewire their networks for police convenience.

Judge Harry Edwards repeatedly pressed a government attorney who had argued that a 1994 law permitted the FCC to extend wiretapping rules to the Internet, even though the U.S. Congress had referred only to telephone networks.

"This is wholly ridiculous," Edwards said, saying that Congress' meaning was clear. The FCC's argument "is such gobbledygook, it's really funny.... It's utter nonsense."

The Bush administration had pressed for these Net surveillance rules for years, saying they were necessary to make it easier to catch "criminals, terrorists and spies" who would otherwise be able to evade detection.

But the organizations behind the lawsuit say Congress never intended to force broadband providers--and networks at corporations and universities--to build in central surveillance hubs for the police. The list of organizations includes Sun Microsystems, Pulver.com, the American Association of Community Colleges, the Association of American Universities and the American Library Association.

Judge David Sentelle suggested that the three-judge panel may effectively split the difference, striking down the FCC's regulation of broadband providers but permitting it to impose wiretapping rules on voice over Internet Protocol, or VoIP, companies.

"They have to be wrong on at least voice over" Internet Protocol, Sentelle said, referring to the library, education and other groups that filed the lawsuit.

Added Edwards: "I don't see how counsel can argue with a straight face" that VoIP could not be covered by the 1994 law, the Communications Assistance for Law Enforcement Act. CALEA did specify that services that begin to supplant traditional phone service could be covered by the rules.

Even without the FCC rules that are scheduled to take effect in May 2007, police have the legal authority to conduct Internet wiretaps--that's precisely what the FBI's Carnivore system was designed to do. Still, the FBI has claimed, the need for "standardized broadband intercept capabilities is especially urgent in light of today's heightened threats to homeland security and the ongoing tendency of criminals to use the most clandestine modes of communication."

According to the groups that sued the government, the FCC is "relying on an interpretation of CALEA that is contrary to the plain meaning of the statute, arbitrary and capricious, and otherwise not in accordance with law."

At least on the question of whether CALEA covers broadband providers, Edwards seemed sympathetic. "A telephone isn't an orange," Edwards told Jacob Lewis, the FCC's associate general counsel. "And just because it's in a new statute you can't say it's a fruit."

In an unusual twist, some of the FCC commissioners who unanimously approved the wiretapping rules have acknowledged that the agency was on shaky legal ground. Then-Commissioner Kathleen Abernathy, for instance, said at the time that she had "concern that an approach like the one we adopt today is not without legal risk."

Earlier this week, the FCC unanimously reaffirmed its Internet wiretapping regulations and said that universities and other companies that would be affected would have to pick up their own costs for the network upgrades.