Ninth Circuit Rules Encryption Export Regulations Violate First Amendment

(May 10, 1999) The Ninth Circuit Court of Appeals issued its opinion in the case Bernstein v. Department of Justice holding that U.S. encryption export regulations violate First Amendment free speech rights.

The Plaintiff, Daniel Bernstein, filed suit on February 21, 1995 alleging, among other things, that the U.S. government's prohibition of strong encryption export, based upon 22 USC § 2778 (Arms Export Control Act - AECA), and 22 CFR §120-130 (International Trafficking in Arms Regulations - ITAR) (now 15 CFR § 730-74), violates the First Amendment, by constituting a prior restraint on freedom of speech.

On August 25, 1997, U.S. District Court Judge Marilyn Patel granted summary judgment for Bernstein, on First Amendment grounds. The U.S. government appealed to the Ninth Circuit Court of Appeals. The three judge appeals court panel affirmed by a vote of 2 to 1 on May 6.

The appeals court opinion stated:

"We find that the EAR regulations (1) operate as a prepublication licensing scheme that burdens scientific expression, (2) vest boundless discretion in government officials, and (3) lack adequate procedural safeguards. Consequently, we hold that the challenged regulations constitute a prior restraint on speech that offends the First Amendment."

However, the court limited the scope of its holding. "We do not hold that all software is expressive. Much of it surely is not. Nor need we resolve whether the challenged regulations constitute content-based restrictions, subject to the strictest constitutional scrutiny, or whether they are, instead, content-neutral restrictions meriting less exacting scrutiny."

The three judges who participated in the decision were Betty Fletcher, who wrote the majority opinion, Myron Bright, who concurred, and Thomas Nelson, who dissented.

Sen. Burns

Sen. Conrad Burns (R-MT), a leading proponent of encryption reform legislation in the U.S. Congress, applauded the ruling. "This is another chink in the armor of the administration's backward-thinking encryption policy, and I don't think it can take many more chinks before it falls apart entirely," said Sen. Burns.

"Although the Ninth Circuit's decision is a great step, there is still a great need for legislation guaranteeing access to strongly encrypted software," said Sen. Burns. "This decision only applies to one case, and it hasn't yet reached the Supreme Court. It's always better to have a concrete policy down in the law books, rather than a policy thrown together by countless court decisions and executive orders."

Rep. Anna Eshoo (D-CA), who represents Silicon Valley, stated that "I'm pleased the federal appeals court has affirmed Federal District Court Judge Marilyn Patel's original decision that in the name of national defense, the U.S. government should not restrict the very liberties it is supposed to be defending. This decision demonstrates the judicial branch's understanding of the encryption debate. Now is the time for Congress and the Administration to follow suit. This means passing and signing into law the SAFE ACT, which will promote the ever increasing growth of electronic commerce in a secure environment." 

Similarly, Ed Gillespie, Executive Director of Americans for Computer Privacy (ACP), praised the ruling. "ACP applauds the Ninth Circuit Court of Appeals for it’s ruling today, finding export restrictions on encryption to be an unconstitutional prior restraint on speech. We oppose export controls because they are unwise, and now the Ninth Circuit has confirmed our further belief that these export controls violate fundamental First Amendment rights."

Gillespie continued that "regardless of how the courts ultimately rule on the constitutional issues, current export restrictions on U.S.-made encryption threaten our leadership role in this vital technology, and ultimately our national security. We hope that the court’s decision will spur Congress to enact the Security and Freedom through Encryption (SAFE) Act."

The SAFE Act, HR 850, is pending in the House of Representatives. Sen. Burns was the sponsor of the PROCODE Act, S 377, in the 105th Congress (1997-1998). He has not re-introduced this bill in the 106th Congress. However, Sen. Burns is a cosponsor of Sen. John McCain's (R-AZ) PROTECT Act.