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Search of old computer files allowed by U.S. appeals court

(Reuters) – Federal agents acted in good faith in executing a warrant to search a Connecticut accountant’s records that had been seized 2-1/2 years earlier, a U.S. appeals court said, in a closely watched case testing how long the government can keep a criminal suspect’s computer data.

But the 2nd U.S. Circuit Court of Appeals in New York on Friday avoided the question of whether keeping the records that long violated Stavros Ganias’ constitutional rights under the Fourth Amendment.

The 12-1 decision, one of the rare cases heard by the entire court, restored Ganias’ 2011 jury conviction and two-year prison term for tax evasion. A three-judge panel had overturned both in June 2014.

At issue were computer files seized in November 2003 by U.S. Army investigators examining possible overbilling by a military contractor that employed Ganias as an accountant.

But rather than purge unneeded files, the government held onto them, and in April 2006 got a warrant to search them for evidence of unrelated tax evasion by Ganias.

In the 2014 ruling that voided the jury verdict, Circuit Judge Denny Chin, the dissenter in Friday’s decision, said the government went too far by searching computer records it had long considered irrelevant for evidence of a new crime.

Writing for the full appeals court in an unusual, 60-page joint opinion, Circuit Judges Debra Ann Livingston and Gerard Lynch did not resolve that issue.

But they cautioned law enforcement to be more careful, citing “significant” privacy concerns and Fourth Amendment issues arising when the government retains hard drives and other digital media containing vast troves of personal information, “much of which may be entirely irrelevant to the criminal investigation that led to the seizure.”

Chin, in his 40-page dissent, said the “cloud” that has hung over Ganias’ head for the last 13 years should be lifted.

“The government did precisely what the Fourth Amendment forbids: it entered Ganias’ premises with a warrant to seize certain papers and indiscriminately seized – and retained – all papers instead,” he wrote.

Stanley Twardy, Ganias’ lawyer, said he was reviewing the decision and might appeal to the U.S. Supreme Court.

U.S. Attorney Deirdre Daly in Connecticut said: “The court’s thoughtful opinion provides a nuanced and balanced analysis of the complexities surrounding searches of digital media.”

Several criminal defense advocacy groups supported Ganias’ appeal.

Google parent Alphabet Inc also supported Ganias, and said additional privacy safeguards may be needed when law enforcement asks service providers such as Google to help search users’ content.

The case is U.S. v. Ganias, 2nd U.S. Circuit Court of Appeals, No. 12-240.