US government 'made an example' of Yahoo with $250k daily fine for PRISM resistance

Yahoo took a lot of flak back in 2013 for having been one of the first companies to acquiesce to the US government's PRISM programme, which included the collection, on an enormous scale, of Internet users' metadata and personal details. However, the latest top secret documents reveal that the US government actually threatened to fine Yahoo $250,000 every day that it failed to comply with the controversial programme, and used this shaming as an example to other tech companies.

Read more: The year the NSA hacked the world: A 2013 PRISM timeline

This latest revelation shines some light on the coercive methods used by the US government to force or cajole major US tech firms operating on US soil into cooperating with the spying efforts of agencies like the NSA.

"unconstitutional and overbroad"

Yahoo began contributing to the database in March of 2008, but according to the latest documents, it did so under incredible duress. The original order to Yahoo in 2007 required the company to provide information on targets that were outside the US, even if the person was a US citizen.

Company executives claim that they believed the government's demand for data was "unconstitutional and overbroad", and fought it in court well into the next year.

Related: GCHQ shocked by "intimate bodyparts" while spying on millions of webcams

"Our challenge, and a later appeal in the case, did not succeed," explained Yahoo general counsel Ron Bell in a blog post published today. "The Foreign Intelligence Surveillance Court (FISC)... ordered us to give the U.S. Government the user data it sought in the matter."

Of course, all proceedings were carried out in secret, away from the scrutiny of the public. When the government's secret court ruled against Yahoo's claim, the government threatened it with the hefty daily fine for failure to comply.

"Making an example of Yahoo"

Not only that, but the US government sought permission to share the results of the secret ruling with other tech companies who might have offered resistance, making an example of Yahoo's humiliation. This strategy ultimately lead to Microsoft, Google, Facebook, YouTube, Skype, AOL, and Apple all participating in the PRISM collection programme. Although Microsoft acquiseced pretty quietly, as the below leaked slide shows (though it seems to have since grown a pair).

Yahoo claims to be on the verge of releasing 1,500 pages of documents relating to the court battle over its participation in the PRISM programme. While the documents have not yet been included in the blog post, Yahoo promises to include them once they become available.

According to Bell, key takeaways from the as-yet unreleased documents include:

  • An expanded version of the FISC-R opinion in the case, originally released in 2008 in a more redacted form.
  • The release of the never-before-seen 2008 FISC opinion that we challenged on appeal.
  • The parties' briefs, including some of the lower court briefings in the appendices.
  • An Ex-Parte Appendix of classified filings.
  • A partially redacted certification filed with the FISC, as well as a mostly unredacted directive that Yahoo received.

Yahoo claims that they "are still pushing for the FISC to release materials from the 2007-2008 case in the lower court."

According to the company, "the FISC indicated previously that it was waiting on the FISC-R ruling in relation to the 2008 appeal before moving forward. Now that the FISC-R matter is resolved, we will work hard to make the materials from the FISC case public, as well."

We'll await that with bated breath, then.

Read more: Facebook accused of Prism collaboration in new EU privacy case