Appellate Court Limits Computer Fraud And Abuse Act

Written by Evan Schuman
April 12th, 2012

In a major decision limiting corporate use of the federal Computer Fraud and Abuse Act (CFAA), the U.S. Court of Appeals for the Ninth Circuit on Tuesday (April 10) said the law is intended to address true cybertheft and other criminal hacking efforts and nothing else. At issue was whether companies could threaten employees with federal prosecution for violating company policies, such as playing games on a company computer.

Beyond the fact that retailers have to deal with many of these employee issues, the potentially bigger retail impact of this ruling is how it would strengthen prosecutions of actual cyberthieves, who tend to work where they shop.

The court’s chief judge, Alex Kozinski, said the more flexible interpretation of the statute to apply to corporate employee policies is dangerous and wrong. “The government’s interpretation would transform the CFAA from an anti-hacking statute into an expansive misappropriation statute. If Congress meant to expand the scope of criminal liability to everyone who uses a computer in violation of computer use restrictions—which may well include everyone who uses a computer—we would expect it to use language better suited to that purpose.”

Kozinski also wrote of the potential peril if the court didn’t tighten the jurisdictional rules.

“Minds have wandered since the beginning of time and the computer gives employees new ways to procrastinate, by chatting with friends, playing games, shopping or watching sports highlights. Such activities are routinely prohibited by many computer-use policies, although employees are seldom disciplined for occasional use of work computers for personal purposes,” he wrote. “Nevertheless, under the broad interpretation of the CFAA, such minor dalliances would become federal crimes. Although it’s unlikely that you’ll be prosecuted for watching Reason.TV on your work computer, you could be. Employers wanting to rid themselves of troublesome employees without following proper procedures could threaten to report them to the FBI unless they quit. Ubiquitous, seldom-prosecuted crimes invite arbitrary and discriminatory enforcement.”

StorefrontBacktalk‘s legal columnist, Mark Rasch, used to head up computer fraud prosecutions for the U.S. Justice Department. Indeed, he ran that area in the earliest days of the CFAA’s creation and usage. Rasch said one of the biggest fears of the expansion of the law today is the potential for companies to use it to cover up illegal firings.

Say, for example, that the company fires worker 1234 for something inappropriate, such as refusing to run personal errands for the CEO. After the firing, the company could review computer logs and discover a minor infraction. Then they say to the former employee, in an attempt to scare them into not suing, “We noticed that you visited Facebook during work hours,” Rasch said. “That’s a crime, so we fired you for criminal activity. I’d say that’s a little absurd.”


One Comment | Read Appellate Court Limits Computer Fraud And Abuse Act

  1. Chet Uber Says:

    The court is correct, Rash is correct. Employers should do what their Security consultants should have told them to. Banners that clearly state you have NO EXPECTATION TO ANY RIGHT OF PRIVACY and company computers are NEVER TO BE USED FOR ANYTHING OTHER THAN company work. In order to make this easier, we Company X have conveniently places a Wireless Access point in the lunch room the password is available from your Supervisor, and three (3) machines are available for sharing – 10 minutes at a time – please be curtious of those with legitimate emergency reasons; and any illegal activity on the break room network suffers all the same punishments as those machines located at your desk. Be clear, be stern. Be human. Employees will appreciate it, you can with most RBUC software manage the sharing time without thinking about it twice. Blacklist as you would your small children. You will find the bill for .25 hours in your Counsels in box, my rate is $250/hr. Keep it out of the court, don’t change the law. This is solely an employee/employer relationship that should be cordial, fair and use inexpensive monitoring gear and add it to though that monitor for exfiltration of TRADE SECRET and other documents or your firewall manager. It can be done with open source and a geek or money.


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