In an ongoing case in which the U.S. government has been trying to force Microsoft to allow it access to data stored on its servers in Dublin, Ireland, Redmond just won a landmark appeal. The Second Circuit Court of Appeals in New York ruled that the Stored Communications Act cannot be used by U.S. investigators to access an email account they believe has been used to traffic narcotics.

Microsoft, backed by many of the world’s biggest names in tech, had previously lost an appeal to quash a warrant. This was reversed by The Second Circuit Court of Appeals, which ruled that the District Court lacked authority to enforce the warrant against Microsoft. Microsoft had maintained that the fact the data was stored on an Irish server meant that U.S. investigators had no right to have Microsoft allow law enforcement access.

This is being viewed as a major landmark victory for the protection of privacy in cloud computing. In an interview with the BBC, Brad Smith, president and chief legal officer of Microsoft said that the ruling made it clear where the U.S. government could not pry, adding, “It tells people they can indeed trust technology as they move their information to the cloud.”

In a press release Smith wrote that people need their privacy to be protected by the laws of their own country, saying that since Microsoft filed the case one thing the company has realized is that, “The protection of privacy and the needs of law enforcement require new legal solutions that reflect the world that exists today – rather than technologies that existed three decades ago when current law was enacted.”

Smith believes the ruling with further encourage Congress to “modernize” the the law as it stands.

Speaking of the Stored Communications Act of 1986 Judge Gerard Lynch remarked that he agreed with the result although was critical of the fact that by storing data overseas Microsoft could protect information from the authorities. He said that a new law must be created that provides balance between law enforcement and the privacy of users.

“I concur with the result, but without any illusion that the result should even be regarded as a rational policy outcome, let alone celebrated as a milestone in protecting privacy,” said Lynch.

Photo credit: Randy Heinitz via Flickr