Financial Times | June 4, 2009
By Joseph Menn in San Francisco

A US federal judge on Wednesday dismissed lawsuits accusing telecommunications companies of illegally spying on Americans, citing a controversial law granting those companies retroactive immunity.

Vaughn Walker, a San Francisco district judge, ruled that Congress did not violate the constitution’s separation of powers last year by allowing the US attorney-general to certify privately to the court that the companies had been asked to co-operate in an antiterrorism programme authorised by the president.

“Congress has manifested its unequivocal intention to create an immunity that will shield the telecommunications company defendants from liability in these actions,” Mr Walker wrote. He added that Congress did not go too far in delegating authority to the executive branch, although he said that matter was “a close question”.

Mr Walker has been weighing a number of cases since it was revealed in late 2005 that the National Security Administration was directing surveillance of international phone calls without warrants in apparent violation of the Foreign Intelligence Surveillance Act.

The original case against AT&T gained heft the next year with the submission of documents from Mark Klein, a former employee, that showed copies of all domestic as well as international electronic traffic through AT&T’s San Francisco hub being diverted into a locked room.

Other employees confirmed in interviews that only those with NSA clearance could enter that room, which contained equipment for storing and sifting through data. Current and former officials in the administration of then president George W.?Bush said that it was part of a second, broader programme, again without warrants, that sought to mine data. 

AT&T and other companies said they could not defend themselves without revealing classified information, and the justice department backed them up. But Mr Walker had previously refused to throw the case out on “state secrets” grounds.

He wrote then that, by going public in defence of the first, international, operation, the White House had confirmed enough of its essence for the suits to ­proceed.

In its unsuccessful opposition to the latest motion to dismiss, the Electronic Frontier Foundation, the civil liberties advocates, tried to poke holes in certification from Michael Mukasey, former attorney-general, that the phone companies were acting in a post-September 11 2001 anti-terror operation.

The group said Mr Mukasey stated in public that the companies were not engaged in a “content-dragnet”, while its evidence showed otherwise. Mr Walker said the EFF made “a valiant effort” to challenge the private certification, considering it was barred by law from viewing it.

Wednesday’s ruling does not affect cases turning on similar facts against the government itself, several of which are before the same judge. Lee Tien, attorney for EFF, said the group would appeal against the dismissal of the phone company cases.