Lawfare Daily: David Kris on Data Proxies for Clients of Cloud Service Providers

[Intro]

David Kris: If the government's coming to get your servers from the basement of your headquarters, you're going to know about it and you're going to be able to get your lawyers spun up and go resist any overbreadth or excess that may be part of the government's request. And you won't have that if the data are stored in the cloud.

Alan Rozenshtein: It's the Lawfare Podcast. I'm Alan Rozenshtein, associate professor at the University of Minnesota Law School and senior editor and research director at Lawfare, with David Kris, founder of Culper Partners and the former assistant attorney general for national security in the Obama administration.

David Kris: So if the judge thinks it'll be helpful to hear from Judge Smith about Alan Corp's legal privileges or other doctrines or other limitations on this wildly outrageous demand for data by the government, the judge can find a way to do it on the back of a carefully written data proxy contract.

Alan Rozenshtein: Today we're talking about a new paper that David has published as part of Lawfare's ongoing Digital Social Contract series entitled, “A Data Proxy for Clients of Cloud Service Providers.”

[Main Podcast]

David, you start your paper with a very interesting vignette or thought experiment about what goes through the mind of a CEO of a large company when they have to think about what to do with their company's data. On the other hand, what that might involve for data security. And so, I'm hoping you could walk through that as kind of a way of situating your proposal today.

David Kris: Yeah, thanks a lot, Alan. I appreciate the opportunity to be here. I mean, the paper, like so much of my writing, is long, detailed, turgid, and, you know, sort of, highly technical.

But I am told it's very fashionable these days to start with a little vignette to draw in the reader. And so I tried to do that here and the vignette involves the XYZ Corporation, which is, let's just say a widget maker. It makes something and sells that thing. And it's a big U.S. corp with, you know, a lot of people, a lot of different offices.

And in the vignette, the CEO is storing, or the company is storing all of the company's data, which is, you know, a huge amount of data, some of it quite sensitive, you know, on premises. Meaning in data centers or on servers that are owned and controlled by XYZ Corporation itself. And the CEO decides that he should consider moving that corporate data, XYZ's data, up into the cloud. Probably storing it with one of the big cloud service providers, Microsoft, Google, Amazon, whomever. And so in the vignette, he takes a brief from the chief information officer, the chief financial officer, the chief legal officer of XYZ, so that he can make an informed decision about moving to the cloud.

And he is told, as I think any CEO would be told today, jeez, this is a great idea from perspective of cyber security, because the cloud providers are way better at securing the data against hackers than XYZ itself. It's a real specialized field, cybersecurity, and you need a lot of expertise. So, your data will be safer from hackers, whether criminal hackers or foreign intelligence hackers, if you put it into the cloud. And the chief financial officer likes it because it's cheaper. You can get better features at a lower price, by and large, if you use cloud providers instead of doing it yourself.

And so that leaves always the lawyer as the skunk at the garden party who says, well, it's great, yep. But there is this one, you know, little bit of a risk, and that is if you put all your data up in the cloud, that means the cloud service provider, Microsoft, Google, Amazon, whomever, you know, will have access to that data in connection with providing all the wonderful services that the CIO and the CFO have just described. And that also means that if the government comes calling, if law enforcement subpoenas or issues a search warrant or whatever for XYZ's data, they can get it from the cloud provider, not from XYZ itself.

And because of the way the law is written, both federal law and some state laws, they can get that data without XYZ ever really knowing about it until it's much too late, which means XYZ is deprived of what lawyers call notice and an opportunity to be heard. You know, to contest law enforcement's demand for its data, and this is a concern.

So that's the little vignette. It's supposed to get you excited and then, I guess, draw you into what is a lot of legal analysis that follows.

Alan Rozenshtein: Well, so let me ask, I mean, you know, you were in the government for a long time, and so now you do a lot of consulting on sort of national security and surveillance matters. In your experience, how much of an actual concern is this for companies? And, you know, on the margin, how much do you think this is actually preventing them or dissuading them from hosting their data on the sort of cloud services that would provide greater security.

David Kris: Yeah, well, you're right. I mean, the paper does emerge from sort of the intersection of three aspects of my professional endeavors: cybersecurity, technology services, market and legal analysis. I do do some volunteer work for the intelligence community. I do paid work for tech companies, including cloud service providers, although they didn't commission this paper or ask me to write it. And I am a, you know, an unreconstructed legal nerd who does legal teaching both to governments and to regular civilians.

And, you know, I do think that this is a problem. It's difficult to quantify exactly how much of a problem it is, but there are some data points that allow inference here. Chief among them is that the big tech companies, mainly Microsoft and Google have been agitating quite energetically about this problem and seeking solutions to it.

So there are many blog posts from senior folks at Microsoft and from those at Google also decrying the difficulty of what I call secret data disclosure, this problem that XYZ Corporation faced in which its data was obtained from its cloud service provider without notice or could be obtained without notice. The big cloud providers were fussing about it. They were complaining about it. They were litigating it, unsuccessfully, in many cases, trying to get notice to their customers, but failing to do so, and also even seeking legislative solutions. And they came close. A couple of years ago, they had a bill that passed the House, so one out of two, but it failed and died in the Senate and did not become law.

So, it's clearly a problem from the perspective of the cloud service providers. I think that some moderately sophisticated companies, like XYZ let's say, are reluctant to move their data up to the cloud because of the concern. Again, I can't be, you know, I don't have inside information that I can sort of disclose that would give you some kind of rigorous assessment of it.

But it's a problem that's been well discussed and decried in the circles where people care about these things, and it hasn't been solved. So it seems to be persistent. And that's frankly, what drew me to sort of take a hard look at it and do the super nerdy legal deep dive, looking also at market dynamics and at security issues that led to this paper. So, I think it's a thing. How big of a thing exactly is difficult to say with precision, but I believe it is having a non-trivial effect, this concern.

Alan Rozenshtein: Before we get to the solution you propose, I want to spend a little more time thinking about the problem itself. And I want to think about it from the perspective of the XYZ Company and then the perspective of the cloud provider.

So, why is it so scary if you're the CEO of XYZ company to think that the government could take your data without you knowing about it in advance? And the reason I ask in this way is because the choice, of course, is not the government takes your data or doesn't take your data. They're probably going to take your data, right? They have a warrant or they have a subpoena or a metadata deorder request under the sort of Communications Act. So the real question is, you know, do you know about it in advance?

So just kind of spell out: why is this ex ante knowledge so valuable and not just that so valuable that it would prevent someone from the obvious cybersecurity benefits that at this point are sort of, you just open a newspaper, you know, every other day and you see the consequences of trying to roll your own cybersecurity and it's, they’re bad consequences.

David Kris: Right? Well, I mean, look, I don't think you are saying this, but let me just dispel one thing, which is, hey, if you're innocent, you've got nothing to worry about, right?

That's not the that's not the argument here. But, you know, yes, I would say that if the government has a proper legal process, you know, they're going to probably get, or at least have a good chance of getting, some, at least, of your data. But there are plenty of cases on the books, and you know about them too, in which a two party inter partes litigation, you know, leads to limitations on the government's access, particularly to organizational data. And whether that's on grounds of attorney client privilege, or whether that's to protect certain constitutional rights, or whether it's just that the you know, the data demand is overly broad.

In our system, at least before the advent of cloud data storage, you know, if the government came to get your data, on premises, you'd know about it. And in many cases, you would go to court, and you would say, you know, the government here wants to look at all our data and they've proposed some kind of government filter team to, that promises that they will not look at our attorney client privileged information. Your honor, that is just not sufficient. You don't have the fox guarding the chicken coop. We want you or a special master or a magistrate judge to review the materials first, make sure that the privileged stuff doesn't get disclosed and improperly used by the government. So we'd like you to impose that.

And sometimes the courts will do that. There are various things that can be done to cabin, to limit, to put some procedures around the government's demand for data. We don't, I mean, I'm a former government person and I do volunteer work today, and I'm not trying to say the government is filled with, you know, deep state, corrupt blah blah. That's not my argument here.

But it is an argument, I think, that I’m making, to say one doesn't in our system comfortably just say well we trust the government. They'll just do everything right? No worries. No, we have an adversary system of justice. And so this idea of having notice means you get to get in there and fight for your rights, as it were. And that's sort of a basic idea of our judicial and legal system. The data proxy solution I'm talking about is a kind of a contract-based approach to try to get you, if not the right to be there yourself, well, then the next best thing to being there, which is somebody in your stead.

Alan Rozenshtein: So do you view your proposal as complementary to, or just orthogonal to, the government being more disciplined in its own data requests?

Because, you know, one could lay out the problem that you laid out and think that the real problem here is that the government too often is making data requests that could be challenged in court, right? If the government were more disciplined, then this problem would, in a sense, go away because challenging the government in court would be pointless because the government only asks for things that it definitely needs and can justify in court.

So you can, one could say that's unrealistic. We can't trust the government. But I'm just curious what your thoughts on that, again, because your perspective is unique. You've been on both sides of this, right? You've been the assistant attorney general for national security thinking about these kinds of surveillance requests. And then also you've been working for companies that are dealing with this kind of stuff.

David Kris: I guess I would say I can assure you with absolute certainty that every data demand issued when I was in charge of the national security division was narrowly tailored, perfectly thought through, and highly trustworthy with no room for any restrictions beyond that which we had adopted ourselves.

And on the other hand, amazingly, and it is an incredible coincidence, Alan, and I believe it's an experience shared by many others who have gone around the revolving door. Every data demand that I have seen when I was in the private sector was radically overbroad and outrageous in its scope with no attention whatsoever to tailoring restrictions or other decency and fair play.

No, I mean, look, yes, it's orthogonal, I guess, and complimentary in the sense that, of course, one wants the government to do it right, to be thoughtful, to be judicious, to be restrained, you know, to get what they need, but you know, to be respectful of rights and not go willy nilly trampling over things. But it isn't in any way, how our system is designed. From soup to nuts in every dimension, we have an adversary system of justice and the way it's set up, you know, it, it isn't for example, you know, like a continental system in which you have a judge overseeing the investigation. We just don't do it that way. You know, you could do it a different way, but it's not our way. And our way, thoroughgoing and across all fronts, is adversary. And we have the parties, sort of, duke it out and the judge then make a decision.

So here, what you're doing is setting up this ex parte system which is different for cloud data than it is for on-premises data, just as a practical matter, putting aside the legal details about, you know, sneak and peek and blah, blah. As a practical matter, if the government's coming to get your servers from the basement of your headquarters, you're going to know about it. And you're going to be able to get your lawyers spun up and go resist any overbreadth or excess that may be part of the government's request. We hope there won't be any, but sometimes experience teaches that maybe there is. And you won't have that if the data are stored in the cloud.

Alan Rozenshtein: Let's talk about these cloud providers for a second. So we'll get to your proposal in a second, but again, just to preview, it involves contracting with a third party who would sort of stand in the stead of the XYZ Corporation.

But of course, there is already under, in this scenario, a contractual relationship, which is to say between XYZ Corporation and Google or Microsoft or Amazon or these cloud providers. Why shouldn't we expect that the market would sort this problem out, in the sense that because XYZ Corporation wants the cloud provider to put up a fight, right? An appropriate fight, whatever that is, when the government comes calling, a market differentiating feature of Microsoft might be, we stand up for you, right? We're better than Google and Amazon, because if you go with Microsoft and I'm making this up, I have no idea what these cloud providers all seem indistinguishable to me, but Microsoft could say, we're going to fight extra hard for you.

And in fact, this has happened from time to time. Right? So there have absolutely been cases where these cloud providers have stood up to the government. So why shouldn't we expect the sort of in equilibrium that that will happen? And then, you know, Microsoft will do that and then Google and Amazon will rush to join them, and sure, that'll increase the prices of cloud services but, you know, it’ll have to increase one way or the other probably not to have someone fight-

David Kris: Probably not by much though, Alan

Alan Rozenshtein: And it'll have to increase one way or the other to fight against the government.

David Kris: Yeah. I mean, there's a couple of answers to that. The glib answer is, the reason to think that it won't happen is that it hasn't happened. And the providers are highly aware of the problem. As I said, they've been publicizing it, complaining to Congress, complaining in court, litigating, and losing the more, I think, nuanced answer explains why that might be.

So, it is true Microsoft in particular has litigated the issue a number of times. They had a case out here where I am in Seattle and where they are located in the Western district of Washington, in which they tried to assert the rights of their customers and in a very long, thorough district court opinion, they lost.

They were told hey, listen, you, Microsoft, a cloud service provider, who is at arm's length with your customers, you know, you're just providing service. They're paying for the service. You don't have what's called standing to come in and assert the rights of those customers. And if there are rights being trampled here, they're not really your rights, Microsoft. They're your customers’ rights, because it's their data that's being taken here. Sure, there might be a marginal case where the demand is so vast that it would bankrupt Microsoft to, you know, comply with the demand. But putting that aside, by and large, what we're talking about here is the rights in the data, and those rights are held by your customers, not by you.

And they've tried in a number of other settings and this is why I think they ultimately were trying to seek legislation is because they felt that they couldn't bridge the gap under current law to stand in the shoes of their customers. And they don't want to have the kind of relationship with their customers that would be required to increase the odds of them being allowed to stand in their customers’ shoes.

The kind of relationship I am talking about here that a data proxy, that's what I'm calling the sort of solution here, would do. It's a relationship that is much closer to a fiduciary or, you know, a relationship of a guardian to a ward or other, or a disabled person. It's a relationship in which the data proxy has contractual obligations to pursue the best interest of the client here, the XYZ Corp or whoever the data owner is.

And I think the cloud companies are very understandably reluctant to get into that kind of a relationship with their cloud service customers. Now they will agree, and indeed they do agree, and you can look online and see the standard terms in Google's cloud services model contract, that they will try to let you know if they get a demand for your data.

So you're XYZ Corp, you sign up for cloud service, your data is up in the cloud, and when the government comes calling and says to Microsoft or Google or Amazon or whoever it is, hey. Give us XYZ's data. They will try to tell you at XYZ Corp that this is occurring so that you can get in there and fight. But they will probably fail, or at least in a lot of the cases they will fail, because in fact the government puts a legal prohibition, a non-disclosure order, forbidding them from telling XYZ Corp. And the companies may try to get that lifted, but they typically fail. The cases show they've typically failed, in where they've tried.

And they are not going to violate the law and go to jail in order to notify you. That's too much to ask from them. Again, there are things they will do, and understandably, I think there are things they won't do. So the data proxy is in a different position. It's in a closer relationship with duties carefully defined by contract, and can step in, if it can get notice of the data demand, even where the customer can't. And then try to litigate.

Alan Rozenshtein: Excellent. So let's now get into the proposal. And so you propose again, what you've called data proxies. I want to make this as concrete as possible because it's a pretty complicated set of interlocking pieces.

David Kris: Oh, I'll say.

Alan Rozenshtein: Yeah, let's say I, so I am the CEO of Alan Corporation.

And I've read this paper and I think I want one of these newfangled data proxies. And so I call you and I say, David, please be my data proxy. So what exactly happens, right? What is in this, what is this an agreement? How does this operate? And then when the government comes calling to, let's say, Microsoft, my cloud service provider, and let's even say, does a non-disclosure order as well, because they think I'm really up to no good, how does this all play out?

David Kris: Right. Okay. So, Alan Corporation has a lot of data and you don't want the government to get it, so, but you do want it safe from the predations of nation state and criminal hackers. So you make the decision that th. CEO of XYZ Corp didn't make until it was too late. You put up your data and well, let's just say Microsoft. It doesn't matter.

Alan Rozenshtein: I am an avid reader of Lawfare's research products. And I read this white paper and it changed everything for me.

David Kris: Good boy. That was, that's excellent. And so, you sign first a contract with Microsoft as your cloud service provider. And in that contract, they agree to host the data and they give you email service and Office 365 and all the bells and whistles that you would possibly ever like. And you're thrilled with the wonderful nature of that service and the security that it has for you.

And in that contract, they agree, as I just described, if the government serves them with a subpoena for your data, they will try to tell you. Okay, but by hypothesis now, in the case we're talking about, the government issues a subpoena for your data, but it also tells Microsoft, don't tell anyone, certainly don't tell Alan, that we're going after Alan Corp's data.

Okay, we're thinking about that problem in advance. And so, at the same time as you sign that cloud services contract with Microsoft, you also sign a contract with, let's just say Judge Smith. Judge Smith was a federal judge, has an absolutely sterling reputation for integrity and honesty and probity, and Judge Smith is universally adored and loved and respected for her integrity.

Okay, and so Judge Smith is going to be your data proxy— retired Judge Smith, not current Judge Smith, anyway. And so you've got this highly trustworthy person serving potentially as your data proxy by contract between you and that person. Judge Smith is not going to do anything else for you. She's not going to be your consultant. She's not going to be your legal advisor or your lawyer. And there's going to be a contract between you and Judge Smith that says that Judge Smith is going to be your data proxy and is going to try to advance your interests if and only if she gets proper legal notice and you don't get notice of a data demand.

And she is going to absolutely respect the non-disclosure obligations that will be imposed on her. She is not going to secretly whisper in your ear that the data have been sought by the government. There's not going to be any warrant canary nonsense where every week she tells you no data demand this week, no data demand this week, no data demand this week, and then suddenly doesn't tell you so, you know there's been a data demand. We're not going to play any games. The contract's going to be super clear. In fact, maybe it will say she doesn't get paid if she violates the non-disclosure order intentionally. So really trying to play it straight down the middle.

And because Judge Smith is sophisticated, a court that is asked to let her have notice, cause that's, what's going to happen. Microsoft's going to agree that when they get the data demand, they're going to try to get you notified. They're going to ask the government. The government's going to say no, don't tell Alan. He's a crook. We don't trust anybody at Alan Corp. This again happens more often than you might think, according to Google, even for well-respected companies.

They just sort of say, we're not taking any chances here. So nobody at Alan Corp can be told. Then, if that happens, Microsoft's going to say, well, then let us, please, your honor, let us tell Judge Smith. Because here's the contract between Judge Smith and Alan Corp saying that she's going to be the data proxy and explaining why this is important, your honor, please allow it. And because Judge Smith has all the characteristics that I described and because the contract is written the way I described judge, the judge says, okay, you can tell Judge Smith the data proxy because she's trustworthy, even if Alan Corp is a thoroughgoing criminal enterprise.

And so Judge Smith gets notice and she doesn't tell Alan Corp on the sly. And she then tries to pursue Alan Corp's rights, first by negotiating with the government, just saying, come on guys, you're being outrageous, you want 80 trillion petabytes of data. Come on, give us some reasonable set of limits on this, and let's set up a reasonable process for making sure you don't get privileged data. Let's make sure there's some mechanism to protect trade secrets. You know, whatever the issues are, there are lots of issues that come up in these things.

And the judge is inclined to, by the way, to give Judge Smith notice not only because she's trustworthy, but because she's super sophisticated and the judge thinks, well, I'll get the benefit of some pretty smart adversary treatment of these issues here. I won't just be relying on the government. And so I'll get a smart litigator on the other side and I'll probably get a better, I'll make a better decision as a result. That's the hope anyway.

Alan Rozenshtein: So let me try to focus in on what I take to be sort of the core feature of this, just so there's no confusion, because this is very complicated, but also very clever. So, the government comes to Microsoft and says, give me Alan's data. And Microsoft says, wait a second, before we do that, we're going to go to a court, and what we're going to do is not challenge your request per se, we're just going to try to get the court to allow us to tell Judge Smith that you have, government, made this request of us and then Judge Smith is going to take it from there.

So, so the agreement with Microsoft might include this we're going to try to honor any data proxy side contract you have to the extent of trying to, let's say, fight a nondisclosure order, not with respect to telling you the company, because we're going to lose that one, but a fight in the nondisclosure order to the extent of being able to tell this data proxy. That's what Microsoft is doing in this scheme. And then the data proxy takes over, assuming that Microsoft can convince the court that the, you know, government super-duper non-disclosure order, you can't tell anyone, no matter if it's Alan Corporation or anyone at all, that that's overbroad. Because Judge Smith, she's a straight shooter. That's kind of the key of the notice part of this.

David Kris: Alan, you have it right. And I hope you immediately start a huge Fortune 50 company that needs this data proxy service. Yeah.

Microsoft's going to do exactly four things as the company's cloud service provider, two of which it already does, and two of which would be new. The two things that it already does are number one, provide cloud service. Okay. That's sort of the baseline. They're going to do all the cloud service-y things that you like. Number two, if the government comes with a data demand for Alan Corp's data, they're going to try to tell Alan Corp. That's again, something they do already. They will ask the government. If the government says no, they will ask a court.

The next two things they're going to do are new and different. They're going to, if they cannot directly give notice to Alan Corp, just as you said, they're going to ask the government and a court to give notice to Judge Smith, Alan Corp's contractually appointed data proxy, and they'll show the data proxy contract as part of that request.

And then finally, if Judge Smith does get lawful proper notice, they will cooperate with Judge Smith to allow her to advance whatever claims in whatever forum that she can do in keeping with the instructions that Alan Corp provided to Judge Smith long before any of this occurred as part of their arrangement. Maybe Alan Corp says, listen, the thing we really care about is our attorney-client privilege. So fight that to the death. Appeal to the Supreme Court, if you need to. Or they say it's trade secrets that we really are, you know, fussy about or whatever it is they want, they can put it in the instructions.

Judge Smith will try to carry those out within her professional expertise and judgment. You can't have that conversation after the data demand has come because that would be notice, but you can have it set up so that the data proxy knows what to do in keeping with the client's preferences ahead of time.

Alan Rozenshtein: And why do you think that courts would be willing to let the cloud service provider, let's assume over the objections of the government, because that's the interesting case, inform the data proxy. I mean, is it because courts have general equitable powers to do things like special masters?

I mean, you know, there's a certain optimism here that courts would be willing to be flexible. And I'm just curious sort of where that optimism comes from in, in your reading of the relevant statutes and cases, or your just experience in this space.

David Kris: Yeah. There's two, I think, reasons to look at this with some degree of cautious optimism. The first is, you know, a non-disclosure order is a limitation on speech. And so, pretty much everybody gets the, is in agreement, the government's hedged a little bit recently, but it's not favored and in theory, it's subject to strict scrutiny. Meaning you don't just willy nilly blanket prohibit disclosures and speech. You got to really narrowly tailor it.

Now, as a practical matter, if you look at the actual cases that have actually been decided, it kind of looks closer to the opposite, where the, you know, the courts are like, look, we can't be sure that somebody at Alan Corp is trustworthy. We can't be sure that some bankruptcy trustee who happens to be running Alan Corp because not only is Alan Corp criminal, but it's also now insolvent. We don't know who that person is. Forget it.

So the one reason is that although the law generally would favor allowing limited disclosure when it is safe to do so, you know, as a practical matter, it's a little tough for courts. That's why Judge Smith has a sterling reputation for integrity and has a contract that really shows she gets the joke and isn't going to tell. And that would allow courts then to, I think, sort of, let's just say, get closer to what strict scrutiny really is supposed to mean. And, you know, courts care about the law, we think. So that's one answer is that, you know, the law supports the disclosure.

The other more sort of pragmatic answer is: in cases where there's complexity, in cases where there, you know, there isn't some run of the mill situation, you have some privileges in issue, whether they're attorney client privilege, where you have trade secrets, or you have some other complex set of issues, the judge may want to have inter partes litigation, two party litigation, as opposed to ex parte litigation, because, you know, it'll help them get the right answer.

And so that's why the data proxy has to be not only trustworthy, but also competent and sophisticated. And so, you know, is it a sure thing? No, it is not a sure thing. This is untested. It is. I like when you say it's clever. I love to be clever. You know, the price of clever is it's new. It's untested. It's uncertain. I think, and the paper lays out in probably nauseating detail the arguments for why there could be standing and why there could be litigation rights.

Even if all of that falls out, you know, the data proxy can still lobby the government, assuming the government will take the meeting, and sometimes they will, sometimes they won't. And it could be brought in as an amicus curiae, even without, you know, you know, forget the legal standing. Judges have enormous discretion to permit amicus participation in cases where they think it'll be helpful.

So if the judge thinks it'll be helpful to hear from Judge Smith about Alan Corp's legal privileges or other doctrines or other limitations on this, you know, wildly outrageous demand for data by the government, the judge can find a way to do it on the back of a carefully written data proxy contract. And that at least gets you in the door, you know, is it perfect? No. But is it better than the alternative, which currently is frankly nothing? Yeah, I think it is.

Alan Rozenshtein: So let's assume that we've gone through the notice step. So the government has agreed, or they've been told by the court that Microsoft gets to inform Judge Smith about this request. Now Judge Smith springs into action.

David Kris: Yeah.

Alan Rozenshtein: So what is Judge Smith actually going to do here? And, you know, like your, I wouldn't say nauseating depth. I think well written and very interesting depth, which your paper does go quite into depth on this. There's a wonderful table, which is great for surveillance nerds like you and me that goes through all the different ways that the government can get information, subpoenas, deorders, warrants, and all the ways that can be challenged pre and post.

Again, I think for the details we'll refer listeners to the paper, but sort of what are the high points from your perspective of what is Judge Smith actually supposed to do now if she's going to go and do battle as her contract tells her to do with the government for over at least some of these data requests?

David Kris: Well, first thing Judge Smith will probably do is get counsel. And Judge Smith might be a, I guess Judge Smith is a lawyer. But Judge Smith-

Alan Rozenshtein: But it doesn't have to be.

David Kris: Doesn't have to be a lawyer. Nope. Cause this is a person standing in the shoes of the client: XYZ Corp. And so, Judge Smith probably get counsel. You know, from Dewey, Cheatham, and Howe. And then those lawyers and/or Judge Smith probably are gonna start by taking a look at this data demand, seeing what it is, maybe it's totally reasonable. Maybe as you said, Alan, the government has turned over a new leaf and is disciplined and judicious, thoughtful, narrow, and everything's great. And you know, there's no basis to challenge it.

I look forward to that world obtaining, and that is, I guess, a theoretical possibility. Much more likely, of course, is the day-to-day reality that we see in all kinds of data demands that are subject to inter partes litigation, in which there is at least something to complain about, okay? Whether that's protection of privilege, whether that's protection of confidential data, whether that's just the breadth and scope of the thing, there's going to be, and typically there is, something to complain about.

And again, Alan Corp has had an opportunity ahead of time to tell Judge Smith exactly what it cares about, okay? Which is going to vary from client to client, corporation to corporation, maybe from time to time. They can give those instructions to Judge Smith. They can update them at any time. It's going to be a one-sided thing if there's a data demand going on, but that's fine.

And so, Judge Smith will probably start, frankly, the way sophisticated counsel would probably start when they have a big data demand. They're going to talk to the assistant U.S. attorneys and, or maybe even the FBI agents who are involved and who issued the data demand and they're going to say, come on guys, this is outrageous. And the usual kind of dialogue that occurs on a daily basis in the criminal justice system at the federal level or in state analogs, because, you know, New York State has pretty famous, powers like those in the Federal Stored Communications Act to get data and to impose non-disclosure obligations, and many other states do as well.

So, there's going to be, first thing, a dialogue with the prosecutors saying let's rein this in, let's restrict it. You know, let's see if we can find some agreement on how to cabin this thing in a way that's fair and equitable. If, and to the extent those discussions do not arrive at a, you know, a shared and satisfactory outcome, well, then you have the possibility of going into court. And there could be two ways that the, well, three really, in which the data proxy has to go to court.

One is it goes in, it brings an action, it challenges the data demand, and the court says, yes, you have, the XYZ Corp would have an ability to fight this. I so conclude. That's not at all obvious. Rights to challenge data demands vary according to the type of data sought, the type of demand being filed, the timing, whether it's before or after the data are produced, and nature of the claim being made. But might say yes, then would say you have standing because you're the appointed data proxy. Let's go and litigate this thing.

Or, you know, as I said, they could go in as an amicus curiae in a proceeding that might be maintained by the cloud service provider, which certainly has an ability to resist at least some kinds of claims that have been served on it, the cloud service provider.

So there's a bunch of different ways the data proxy would proceed, either in the negotiation frame or in the litigation frame, withstanding, without standing as amicus or otherwise. And pursuing, again, the instructions that Alan Corp has given it based on what Alan Corp cares most about.

Alan Rozenshtein: Let's talk about standing, because you mentioned earlier when I asked, well, why can't the cloud service providers themselves just provide the service? You said, well, a lot of courts have found that they don't have standing.

So why would that change here? Or why is it that, that Alan Corp can't give standing to Microsoft in its contractual agreement with Microsoft, but it could give standing to Judge Smith, just by writing a different contractual agreement with Judge Smith.

David Kris: Well, there's not a lot of litigation on this, but what litigation there is has not been good for the standing of the cloud service providers, under the terms of their normal contracts with their customers. And, you know, these cloud service providers, they got a lot of customers, right? Like thousands and thousands or millions of customers, okay? Who are using their data services, their cloud data services.

And those contracts are very carefully engineered and written by their lawyers so as to minimize the risks and obligations of the cloud server providers. They are willing, and it is a standard term, to try to notify a customer if a data demand comes in for the customer's data. But, generally speaking, that's as far as they go.

I mean, there was one famous case involving some data held in Ireland, where Microsoft allowed itself to be held in contempt of court. I guess Brad Smith had to bring his toothbrush that day in case he left by the back door. But this was a very special situation designed to create a vehicle for appellate litigation. And indeed the case did go all the way to the Supreme Court before Congress intervened with legislation to essentially moot it.

Routinely speaking, they're not going to do certain things, and they're very careful, as they should be, about taking on special duties on behalf of their many thousands or millions of customers. Okay? Okay. So, you know, they're not stupid. If they wanted to take on those obligations, they probably could. And if we had legal reform, it would be possible potentially for them to do so without really becoming like a guardian.

But there are categories of people in law that do have third party standing, you know, trustees and guardians and receivers and assignees and executors. These are familiar examples, to at least nerdy lawyers, of people who go into court and advance the rights and interests and claims of other people who are not themselves in court at that moment. So, you know, the example I use here is as a guardian. A guardian is someone who's advancing the interests of their ward, and the ward, let's say, is mentally disabled or is a child or something, so they don't have an ability to argue their own case in court.

Well, here, XYZ Corp is kind of like that because they've been disabled, as it were, due to their ignorance, because the non-disclosure order is designed precisely to keep them out of the play, out of the litigation. And so the data proxy is prepared to take on, by contract, the special obligations of advancing the interests of XYZ Corp in a way that at least so far, the cloud providers themselves have not been willing to take on. And when the cloud providers have tried to litigate on behalf of their clients, or their customers, without those kinds of special contractual duties and terms in place, they've lost.

So the data proxy would be willing to go where the cloud service providers aren't willing to go and as a result would have a much better chance, in my view, of getting standing and being allowed to stand in the shoes of their clients.

Alan Rozenshtein: So to close it out, I want to say I'm convinced, personally, that this is at the very least a cool and clever proposal that is worth trying, because it really does seem to solve a problem that kind of everyone has and that would really make everyone better off.

So I want to close by asking, how does this thing get off the ground? Right? Is it just a matter of some company needs to find a Judge Smith and just see what happens? Do we need sort of to organize the Judge Smiths and get them pre-cleared and convince the government? I'm just sort of curious, you know, assuming that folks wanna actually try this, what is the next step?

David Kris: Sorry, I'm still reeling from cool and clever since I never get anything like that. So, thank you for that, Alan. I mean, you do have good judgment, so it actually means something to me.

I mean, I think the first thing we've got to do is get awareness up. This is, as you said, and I acknowledge, a very complicated set of arrangements, and it's based on a very complicated set of understandings. It is not super intuitive. I think you've done a terrific job here asking all the right questions, and I hope I've given reasonably clear answers that help elucidate what is going on. But let's be honest, it's not easy stuff to grasp, okay? So first, awareness.

Second, as you said earlier, then I think there is a market-based solution. There are people who could be data proxies and who probably would be. It's not everybody, because remember, this is a single purpose data proxy, meaning it's not going to be any good if you are also the lawyer or the consultant for XYZ Corp, because then the government's going to say, jeez, your honor, we can't give notice to that data proxy because they're, they might be in the soup. You know, they might be in the tank with the company and part of the wrongdoing.

So it's going to be an, it's going to be a single purpose entity, which means there is, you know what the economists call opportunity cost, because if you become the data proxy for XYZ Corp, you're not going to be able to provide all these other, probably more lucrative services. And so, you know, there's a narrow slice of folks, I think retired federal judges come to mind who would potentially do this but it's not going to be everybody. And you count on those people to step forward.

And also, frankly, for sophisticated companies like XYZ to start asking Google and Microsoft and Amazon. Hey, get us a data proxy. Okay? And if it ain't you, then find us somebody else. Okay? And then maybe the sales teams at Google and Microsoft and Amazon and everybody else, you know, start saying, jeez, we're encountering this demand signal from our potential clients. We just want to close the deal. We're salespeople, okay? Coin operated. So I just want to get to yes, as fast as possible so I can get my commission. This is the way the system is designed, and understandably.

So corporate, Microsoft, Google, and Amazon, figure out some solution to this so that we can sell it as option 3A in the drop down menu of options that somebody can do select when they sign up for cloud services with us. That might send Microsoft scouring for data proxies, and I think they could find Judge Smith somewhere.  If there's a market solution, then, you know, there's a market solution, and uptake, you know, occurs and then it builds on itself.

The other aspect of this, of course, is let's assume I'm wrong and the whole thing blows up. It doesn't work. You know, three data proxies are appointed and all three of them swing and miss. And the courts are like, no, thank you. I don't think that's going to happen. I've worked pretty hard at this. I understand it, I think, from a theoretical level, from a practical level, from a business and markets level, you know, again, it's at the intersection of these three strands of my work, security, markets, services, and academic-y nerdy stuff, but if it fails, it is also a roadmap for legislation.

There was legislation, as I said, that passed the House and died in the Senate. It's possible that legislation will be revived if the tech companies make a new push for it, or if anybody makes a new push for it. The article here that I've written, if it doesn't work under current law, and I think there's a chance it would, but if it doesn't, well, it's a road map for legislative reform under which this really could be done. And so either way, the ultimate purpose here is: remove barriers to cloud uptake so that we can enhance cybersecurity, which is good for cybersecurity, for economic security, for national security, it's good all around.

And it is the preferred way of doing things now for lots of reasons, including cost, but most of all for security. We've got to figure out ways to make that easier, not harder. We can do it under current law with the contract arrangements I've described. And if that fails, we can probably do it with some pretty straightforward legislative reform, at least at the federal level. I'd like to see it happen one way or the other.

Alan Rozenshtein: I think that's a good place to leave it. Thank you for writing this really great paper and I do encourage folks that are listening to this and want the, kind of all the i's dotted and t's crossed version of this, which is a very complicated, but very well-crafted and very well-explained proposal to go check out the paper.

So thanks for writing it and thanks for coming on to talk about it.

David Kris: Well, thank you as well, Alan. I really enjoyed it.

Alan Rozenshtein: The Lawfare Podcast is produced in cooperation with the Brookings Institution. You can get ad-free versions of this and other Lawfare podcasts by becoming a Lawfare material supporter through our website, lawfaremedia.org/support. You'll also get access to special events and other content available only to our supporters.

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