Illinois Federal Judge James Holderman ruled in August that the Wiretap Act does not apply to unencrypted wireless networks of the kind commonly used in coffee shops, hotels, restaurants, and stores. A company called Innovatio IP Ventures was seeking this preliminary ruling prior to using “packet sniffing” technology to gather evidence for a case against various businesses it believes are infringing its patents.
While Innovatio is obviously happy with this result, this decision provides some good news for Google as well because it directly contradicts a 2011 ruling in a case involving Google’s Street View cars intercepting traffic from unencrypted networks in residential and commercial areas. As Google’s street view case is now before the U.S. State Court of Appeals for the Ninth Circuit, the technology giant now has more reason to hope that the court will side in its favor.
The Wiretap Act makes it a federal crime to intercept electronic communications, but Judge Holderman’s ruling was based on an exception in the law that states that it is not illegal to intercept communications “made through an electronic communication system that is configured so that such electronic communication is readily accessible to the general public.” In applying this exception to the case, Judge Holderman argued that Innovatio is using commercial hardware and software that is cheap and readily available to the public. He went on to say that because the networks Innovatio is seeking to use packet sniffing technology on are unencrypted, they are not private.
The outcome of this case could have repercussions not just for companies like Google and Innovatio, but also for ordinary people concerned about privacy in the digital age. Most wireless networks are secured with a password, but private individuals using the wireless networks of businesses like coffee shops that often operate without encryption run the risk of having their activity intercepted. It is this collateral damage that has many privacy experts watching this lawsuit closely.
A precedent here could open the floodgates for companies to use packet-sniffing technology on unencrypted networks with relative impunity. Europe has already planted itself firmly on the side of privacy, slapping Google with a $22.5 million fine for its street view cars collecting information from unencrypted networks. If the United States goes in a different direction, that could create a very quirky environment for multinational corporations to work within. Many technology and business leaders have been arguing that “Data is the new oil,” so the outcome of these proceedings will no doubt be under close scrutiny.