Law Times

Law Times • May 27, 2013 Page 11 FOCUS Cases consider limits on sharing evidence internationally case with the privacy rights of the people affected by the disclosure," says Carsten, a partner with Davis LLP who focuses on investigations, fraud recovery, and cyber law. "The court was hesitant to turn over all the information on the servers." BY MARG. BRUINEMAN For Law Times A recent court decision addresses the question of Canada's limitations in helping to access information that could be tied to international online crime. Canada (United States of America) v. Equinix Inc. is an illustration of the long, healthy, and constructive relationship Canada and the United States share in providing assistance to law enforcement agencies in the investigation of cross-border criminal activity, says Martin Kratz, head of the intellectual property practice at Bennett Jones LLP. "Increasingly, as people adopt cloud-computing solutions, there's an issue of law enforcement access to records," says Kratz. "There's not a lot of reported cases where you have some insight into the oversight of how [mutual law assistance treaties] work. This case is interesting because it's showing us how the mutual law assistance treaties are operating under judicial oversight." Canada's attorney general applied under the Mutual Legal Assistance in Criminal Matters Act to send mirror-imaged copies of 32 seized computer servers to U.S. officials. But the company argued the information they contained, equal to what 100 laptop computers might hold, was overwhelming. It also suggested the application was overly broad and said the evidence connecting the servers to the alleged crime was scant. In Megaupload Inc. v. Attorney General of Canada, American prosecutors accused the company of wrongfully disseminating copyrighted materials including movies and music through 50 million daily users that resulted in a loss of $500 million. In addition to the Canadian servers, the company does business in at least four other countries. It has hundreds of servers. The link between the Ontario servers and the alleged crime was an e-mail from one of the co-accused indicating that the servers would be used as database and number-crunching machines. While the court denied the application after finding the search the U.S. government sought to be too broad, it suggested that a narrower request could be within the realm of possibility. As a result, it laid the foundation for another application. "Given the nature of the allegations, it is likely that the volume and breadth of data relevant to the prosecution as a whole is enormous. Financial, web traffic, and transactional information are all likely to be relevant," wrote Justice Gladys Pardu of the Ontario Superior Court of Justice in the January decision in Equinix. "In my view, the appropriate balance of the state interest in gathering evidence and privacy interests in information can be struck by an order that the servers In cloud computing, servers store digital information clients can access from anywhere. So when authorities seize the entire server, there's a risk that some private information that's not at all related to the nature of the criminal search could be available. But Carsten points to another problem. If the seized server is shut down, those clients no longer have access to their information. "It has implications for individuals and businesses. It makes people really consider where they're storing their data." LT 'Increasingly, as people adopt cloud-computing solutions, there's an issue of law enforcement access to records,' says Martin Kratz. be brought before the court pursuant to s. 15 (2) so that the court can make an order refining what is to be sent." Privacy laws allow access to records collected by third parties for the purposes of the investigation of criminal conduct. The challenge for the courts is to balance privacy with other factors. In Megaupload, the court decided there might well be relevant data contained in the 32 servers but found it was likely that not all of the information they held was relevant. The decision confirms not all of the data can be examined and lays out a process to find the information that's relevant. When it comes to information and deciding what to keep and what to get rid of, organizations are now seeking to adopt document-retention policies to determine what they should retain and for how long in order to ensure they're only holding on to the records they require. Keeping information beyond its point of usefulness can prove costly both to store it and when an obligation arises to retrieve it. The process allows for each record to be analyzed to determine how long it should be kept and develop a timeline for its destruction. "It helps you reduce the cost and the distraction of locating all the records," says Kratz. He points to e-mails now often replacing phone calls that leave behind written documents that didn't previously exist. The chain or series of e-mails could be extensive and dramatically change the discovery process. The issue is how to determine which e-mails are relevant. The Megaupload decision, says Kratz, should be some comfort to those concerned with privacy sensitivities with respect to data made available for law enforcement purposes under the mutual law assistance process. Tudor Carsten says the issue involves a balancing act the courts are increasingly dealing with as cloud computing and other related technologies become more common. "What the court is doing in the Megaupload decision is to try to balance the rights of the plaintiff to get evidence necessary for its WHAT'S HAPPENING IN EMPLOYMENT LAW? Canadian Employment Law Today is the essential newsletter you need for employment law-related rulings in court, tribunals and other judicial bodies. The bi-weekly newsletter summarizes and comments on issues and trends in employment law. Save valuable hours of research — spend more time using the information to improve procedures and decisions. 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