During a long-running secret dispute between Yahoo and government officials over the constitutionality of orders from the federal government to turn over data belonging to Yahoo users, the company was facing fines of $250,000 for refusing to comply with the order.

The revelation is contained in a cache of 1,500 pages of documents declassified by the federal government related to a six-year-old fight between Yahoo and the government. The company received a series of orders under the predecessor to the Foreign Intelligence Surveillance Act–the Protect America Act–to turn over information on Yahoo users overseas. The company refused and challenged the validity of the PAA.

“The directives issued to Yahoo! under the PAA required it to assist the U.S. Government in acquiring foreign intelligence information through the surveillance of targets reasonably believed to be located outside the United States.  Yahoo! refused to comply with the directives, and the U.S. Government initiated proceedings in the FISC to compel compliance,” the Office of the Director of National Intelligence said on Thursday.

“Yahoo! opposed the U.S. Government’s motion to compel compliance with the directives primarily on the ground that the directives violated the Fourth Amendment rights of its customers.  On April 25, 2008, following extensive briefing by the parties, the FISC held that the directives were lawful and ordered Yahoo! to comply.”

The PAA was part of the Bush administration’s warrantless surveillance program, but the Foreign Intelligence Surveillance Court held that foreign intelligence was exempt from the requirement that the government obtain a warrant for user data. Yahoo appealed the decision to the FISC Review court, and lost again. The FISC-R’s opinion on the appeal was classified, but now those documents and many others related to the case have been made public. Yahoo officials requested that the documents be declassified, and the government eventually agreed, an extremely rare event.

“We consider this an important win for transparency, and hope that these records help promote informed discussion about the relationship between privacy, due process, and intelligence gathering,” Ron Bell, general counsel at Yahoo, said.

“Despite the declassification and release, portions of the documents remain sealed and classified to this day, unknown even to our team. The released documents underscore how we had to fight every step of the way to challenge the U.S. Government’s surveillance efforts. At one point, the U.S. Government threatened the imposition of $250,000 in fines per day if we refused to comply.”

Bell said that the company is still working to get documents from the original FISC case declassified, as well.

“Users come first at Yahoo. We treat public safety with the utmost seriousness, but we are also committed to protecting users’ data. We will continue to contest requests and laws that we consider unlawful, unclear, or overbroad,” he said.

Categories: Government, Privacy