Case Dismissed?

The case for new legislation retroactively giving telecoms companies protection against private lawsuits—including lawsuits already pending—was outlined this week by Kenneth Wainstein, assistant attorney general for national security. At a House Judiciary Committee hearing chaired by Rep. John Conyers, a Michigan Democrat, Wainstein said that giving telecoms companies retroactive liability was a matter of "general fairness."

"I think it's sort of fundamentally unfair and just not right to—if a company allegedly assisted the government in its national-security efforts, in an effort to defend the country at a time of peril, that they then get turned around and face tremendously costly litigation and maybe even crushing liability for having helped the United States government at a time of need ... it's just not right," Wainstein testified.

Wainstein also claimed that "every time we have one of these lawsuits, very sensitive information gets discussed and gets leaked out, disseminated out in the public. And our adversaries are smart, both the terrorists who might be over in, you know, someplace in the Middle East are smart, and then the governments that might be our adversaries are tremendously sophisticated, and they're gleaning all this information that gets out." Wainstein also said that a telecom company's overseas assets could be threatened if its collaboration in U.S. espionage efforts were confirmed in a court case.

The campaign for industry protection was initially launched last summer when administration and industry officials first tried to get the immunity provision included in the Protect America Act—a measure passed by Congress and signed by President Bush on Aug. 5 that allowed the surveillance program to continue and temporarily gave the National Security Agency expanded eavesdropping powers. At the time, Democrats in Congress balked at including the kind of sweeping retroactive civil immunity protections that the industry sought.

But then, on Aug. 15, a three-judge panel of the Ninth Circuit Court of Appeals in San Francisco heard oral arguments in a Justice Department motion to block the Electronic Frontier Foundation lawsuit against AT&T. More than 40 other civil suits filed against the telecoms—many of them seeking billions of dollars in damages—had been consolidated with the EFF lawsuit. But the Justice Department had sought to block the lawsuits under the "state privilege" doctrine, which can require the dismissal of suits that might endanger national security.

The three-judge panel, made up entirely of Democratic appointees, seemed openly skeptical of the Justice Department's arguments, prompting many court observers to conclude that the panel was likely to issue a ruling permitting the lawsuits to proceed. At one point in the proceedings, one of the judges, Harry Pregerson, a Jimmy Carter appointee, appeared annoyed with the Justice Department lawyer, Gregory Garre. The judge wanted Garre to provide direct answers to questions about the scope of the just-passed surveillance law, according to press reports. When Garre tried to explain that the law was complicated, Pregerson shot back: "Can't be any more complicated than my phone bill."