Judge Says Search Warrants for E-mails Must Be ‘Limited’

Can law enforcement obtain a search warrant to dig through a vast trove of e-mails, instant messages and chat logs because they have reasonable suspicion that the owners of those accounts robbed computer equipment from a private company?

No, according to a ruling by a federal judge in Kansas earlier this week.

The case is significant in that it limits what constitutes unreasonable search and seizure, as protected by the Fourth Amendment, in the age of big data. The magistrate judge, David J. Waxse, denied the government’s search warrant requests on the grounds that it has to be particular and “reasonable in nature of breadth.”

Orin Kerr, a law professor at George Washington University and an expert on surveillance law, interpreted it this way on Twitter: “You can’t look through the kitchen sink to get the evidence, as you do with physical searches.”

Prosecutors sought search warrants to extract information from Verizon, an Internet service provider, GoDaddy, a Web site hosting company, along with Web communications companies Google, Skype and Yahoo on account holders suspected of having stolen $5,000 in computer equipment from Sprint.

The government believed that the suspects used e-mail and instant-message accounts to “facilitate the purchase, receipt and transportation of the equipment” from Kansas to New Jersey. The government sought “contents of all emails, instant messages and chat logs/sessions â€" and other account-related information” for the named suspects.

The judge balked.

If the authorities are looking for a stolen lawn mower in a garage, he wrote, citing a previous case involving search warrants of physical property, they can’t get a search warrant that covers the upstairs bedroom.

“The manifest purpose of the Fourth Amendment particularity requirement is to prevent general searches. By limiting the authorization to search the specific areas and things for which there is probable cause to search, the particularity requirement ensures that the search will be carefully tailored to its justifications, and will not become a wide-ranging, exploratory search prohibited by the Fourth Amendment.”

The judge went on to say that the government’s search order ought to have “sufficient limits or boundaries” to the communications that law enforcement officials can rifle through. He suggested that the search order be limited to certain keywords or that an independent vendor be asked to automate the process of finding relevant material.

That is to say, use data-mining techniques to not rummage through everything.

Daily Report: Start-Ups That Could Be the Next Big Thing

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Microsoft Cuts Deal With Activist Shareholder to Avoid Fight

The saga of Steve Ballmer’s departure/retirement from Microsoft continued Friday with an agreement between Microsoft and an activist shareholder, ValueAct Capital, that averts a potentially nasty battle over the company’s lagging performance.

Microsoft said in a statement that it has signed a “cooperation agreement” with ValueAct for regular meetings between G. Mason Morfit, president of ValueAct Capital, and Microsoft’s board and management to “discuss a range of significant business issues.” More significantly, the deal gives Mr. Morfit the option of joining Microsoft’s board, which he is likely to do in early 2014, during the company’s quarterly board meeting.

The deal comes exactly a week after Microsoft announced that Mr. Ballmer, its chief executive, will retire from the company within the next 12 months after a successor is found. It is widely believed that pressure on Microsoft’s board from ValueAct played a role in speeding Mr. Ballmer’s departure, though Microsoft has downplayed a connection between the two.

ValueAct, a San Francisco investment firm with $12 billion in assets under management, owns only a small chunk of Microsoft’s stock, about 0.8 percent of its outstanding shares. But Rick Sherlund, an analyst at Nomura Securities who was the first to report on ValueAct in a research report back in May, has said that ValueAct could have banded together with other shareholders dissatisfied with the performance of Microsoft’s stock. Had Microsoft resisted ValueAct’s efforts, the investors could have mounted a public fight, known as a proxy battle, to nominate a representative to the company’s board.

The timing of Microsoft’s announcement of the deal â€" late Friday before a long weekend â€" appeared calculated to minimize the attention it would receive. It also coincided with a deadline by which ValueAct had to notify Microsoft of its intentions to begin a proxy fight.

“Our board and management team are committed to enhancing growth and value for Microsoft shareholders, and we look forward to ValueAct Capital’s input,” Microsoft said in its statement.

By announcing plans for Mr. Ballmer’s departure last week, Microsoft has already made a major concession to ValueAct on one of the issues believed to be on its agenda. Among other shareholder demands is a big increase in the company’s dividends.

George F. Hamel Jr., a founder of ValueAct, did not respond to a request for comment on the firm’s plans. Mr. Morfit said in a statement: “At this critical inflection point in the company’s evolution, I look forward to actively working together with the board and Microsoft’s management team to continue to create value for all shareholders.”

Microsoft and many of its shareholders have been at odds for years. The conflict stems in large part from the long-term investments Microsoft has made in areas like Internet search, which Mr. Ballmer and the company’s board have argued are essential to Microsoft’s future. Investors have been frustrated, though, with the lack of traction that many of Microsoft’s newer initiatives have gained.

In an interview before Microsoft announced its agreement with ValueAct, Mr. Sherlund said he believed the company’s board was finally showing signs of being more receptive to input from shareholders.

“I think you are seeing a monumental shift in corporate governance under way at Microsoft,” Mr. Sherlund said. “Now they are open to talking to shareholders.”

Today’s Scuttlebot: Skype a Decade Later and Why There Aren’t Enough Women in Tech

Every day, The New York Times’s staff scours the Web for interesting and peculiar items.

Here’s what we noticed today:

Skype a Decade Later
GigaOM |  On Skype’s 10th birthday, an argument for why Microsoft is muffling the Internet calling service. - Nick Wingfield

This Is Why There Aren’t Enough Women in Tech
Valleywag |  An eye-popping collection of horror stories from women who pursued computer science in college. - Damon Darlin

Twitter Executive to Leave
Bricoleur |  Alex MacGillivray, Twitter’s general counsel, announced that he was planning to step down. - Ashwin Seshagiri (Related Bits post.)

Google Acquired WIMM Labs to Bolster Its Own Smartwatch Plans
GigaOM |  Move over, Glass. Google’s smartwatch ambitions get more serious. - Claire Cain Miller

New Faces of Android: Inside Google’s Management Shuffle
The Verge |  An inside look at what the departure of Hugo Barra, “a rare friendly face” at Android, means for Google’s mobile team - Claire Cain Miller

Role Models Who Reach for the Stars
The Financial Times |  Is Marissa Mayer doing a disservice to women by describing herself as a geeky coder who never intended to lead? - Claire Cain Miller (Subscription required.)

In the Serengeti, Getting Close to Lions With Technology
Fast Company |  A new interactive feature from National Geographic partly uses robots with cameras to capture lions from the Serengeti in their element. - Ashwin Seshagiri

Facebook Tests ‘Trending’ Section in News Feed
The Wall Street Journal Digits Blog |  Two months after introducing hashtags, Facebook is experimenting with ways to make them useful in a trending section. - Ashwin Seshagiri

Covering the Syria Crisis
Syria Deeply |  Journalists and technologists tell you what you need to know about the crisis in Syria, melding quick hits and long reads - Somini Sengupta

Today’s Scuttlebot: Prisoners Imagine the Internet

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Apple Expands iPhone Trade-In Program to Its Stores

Apple is trying to give people another reason to come to its elegant retail stores: Trading in old iPhones for a store credit toward a new phone.

Apple has offered a trade-in program for years through its Web site, but on Friday the company confirmed it would begin accepting older iPhones in its brick-and-mortar stores.

“IPhones hold great value,” said Amy Bessette, an Apple spokeswoman. “So, Apple retail stores are launching a new program to assist customers who wish to bring in their previous-generation iPhone for reuse or recycling. In addition to helping support the environment, customers will be able to receive a credit for their returned phone that they can use toward the purchase of a new iPhone.”

Apple has teamed up with Brightstar, a company that buys and resells used electronics, to handle the trade-in program.

Ms. Bessette declined to say how much money customers could get for their used iPhones. But on Apple’s Web site, a used iPhone 5 in good condition, with 16 gigabytes of storage and accessories included, goes for $336.

The trade-in program serves to benefit Apple not just by keeping iPhone customers loyal: It gives people an incentive to buy an iPhone straight from an Apple store, instead of other outlets like an AT&T and T-Mobile US store or even a Best Buy. Those stores also offer trade-in programs.

Why bother luring people to the Apple stores? Along with a new iPhone, customers might want to pick up other Apple products. Apple’s retail employees could also persuade customers to pay for its Apple Care warranty program for protecting against damage, competing with Best Buy’s warranty program for iPhones.

What remains to be seen is how Apple will implement the trade-in program without harming the experience of shopping at an Apple store. The company is famous for attracting long lines to its stores whenever a new iPhone is released. If employees have to evaluate older iPhones that are being traded in, it could slow down the lines, driving people to other stores.

Twitter General Counsel Leaves as Company Prepares to Go Public

Alex MacGillivray, Twitter’s chief lawyer and the Internet industry’s most prominent champion of free speech rights, announced on Friday that he would step down from his post, as the company expands its global footprint and prepares for a widely anticipated public offering sometime next year.

The company announced the appointment of a new general counsel, Vijaya Gadde, who had managed the company’s corporate affairs for the last two years. Mr. MacGillivray, better known as AMac, said he would continue in an advisory role.

On his personal blog, he wrote: “I’m looking forward to engaging my various internet passions from new and different perspectives, seeing friends and family without distraction, and just goofing off a bit. We should all do more of that.”

Mr. MacGillivray, who worked at Google before joining Twitter, has won accolades from civil libertarians for advocating for the rights of users and for often resisting requests for information about its users. It pushed back against a court order in 2011 to reveal names of WikiLeaks supporters, including by informing users that their information was being sought.

He has not always been successful. Most recently, Twitter agreed to identify several users who posted anti-Semitic comments on its service, and whom French authorities sought to prosecute for violating that country’s anti-hate laws.

Mr. MacGillivray’s departure comes at a time when Twitter is positioning itself as a multinational company, with offices and data servers around the world and pressure to comply with government requests for user data.

“It’s got enough impact now that governments around the world are going to want it on speed dial and are going to be seeking cooperation on a variety of fronts because Twitter now is such a vector for communications, particularly fast-breaking communications,” said Jonathan Zittrain, a Harvard law professor.

Twitter will inevitably have to confront how it balances its business interests with its advocacy of free speech, he added. “You can’t lightly alienate important governments. Figuring out how to reconcile that with desire to promote free of speech, that’s a big corporate question.”

Indeed, the company’s public policy department will now report directly to its chief executive, Dick Costolo, rather than to the new general counsel, as it had in the past, a company spokesman said.

Previously as a lawyer for Google, Mr. MacGillivray pioneered the issuance of semi-annual reports on government requests for user data. Google started the trend several years ago; Twitter followed last year and most recently, so did Microsoft and Facebook.

The general counsel’s office also will be facing a mountain of legal paperwork in connection with the company’s initial public offering.

Ms. Gadde, who has a corporate background, is well positioned to head those efforts. She specialized in corporate and securities law at the Silicon Valley firm Wilson Sonsini Goodrich & Rosati for 10 years before leaving to work at Juniper Networks, a computer security company, and, in July 2011, joining Twitter.

“It’s a ton of work to take a company through an I.P.O., and he may have thought rather than take on that challenge, it’s time for someone else to take it on,” said Eric Goldman, a law professor at Santa Clara University.

Twitter General Counsel Leaves as Company Prepares to Go Public

Alex MacGillivray, Twitter’s chief lawyer and the Internet industry’s most prominent champion of free speech rights, announced on Friday that he would step down from his post, as the company expands its global footprint and prepares for a widely anticipated public offering sometime next year.

The company announced the appointment of a new general counsel, Vijaya Gadde, who had managed the company’s corporate affairs for the last two years. Mr. MacGillivray, better known as AMac, said he would continue in an advisory role.

On his personal blog, he wrote: “I’m looking forward to engaging my various internet passions from new and different perspectives, seeing friends and family without distraction, and just goofing off a bit. We should all do more of that.”

Mr. MacGillivray, who worked at Google before joining Twitter, has won accolades from civil libertarians for advocating for the rights of users and for often resisting requests for information about its users. It pushed back against a court order in 2011 to reveal names of WikiLeaks supporters, including by informing users that their information was being sought.

He has not always been successful. Most recently, Twitter agreed to identify several users who posted anti-Semitic comments on its service, and whom French authorities sought to prosecute for violating that country’s anti-hate laws.

Mr. MacGillivray’s departure comes at a time when Twitter is positioning itself as a multinational company, with offices and data servers around the world and pressure to comply with government requests for user data.

“It’s got enough impact now that governments around the world are going to want it on speed dial and are going to be seeking cooperation on a variety of fronts because Twitter now is such a vector for communications, particularly fast-breaking communications,” said Jonathan Zittrain, a Harvard law professor.

Twitter will inevitably have to confront how it balances its business interests with its advocacy of free speech, he added. “You can’t lightly alienate important governments. Figuring out how to reconcile that with desire to promote free of speech, that’s a big corporate question.”

Indeed, the company’s public policy department will now report directly to its chief executive, Dick Costolo, rather than to the new general counsel, as it had in the past, a company spokesman said.

Previously as a lawyer for Google, Mr. MacGillivray pioneered the issuance of semi-annual reports on government requests for user data. Google started the trend several years ago; Twitter followed last year and most recently, so did Microsoft and Facebook.

The general counsel’s office also will be facing a mountain of legal paperwork in connection with the company’s initial public offering.

Ms. Gadde, who has a corporate background, is well positioned to head those efforts. She specialized in corporate and securities law at the Silicon Valley firm Wilson Sonsini Goodrich & Rosati for 10 years before leaving to work at Juniper Networks, a computer security company, and, in July 2011, joining Twitter.

“It’s a ton of work to take a company through an I.P.O., and he may have thought rather than take on that challenge, it’s time for someone else to take it on,” said Eric Goldman, a law professor at Santa Clara University.

Verizon in Talks to Buy Vodafone’s Stake in Its Wireless Unit

Updated, 8:27 p.m. | With a majority of Americans using Verizon Wireless for their cellphone service, it may not seem obvious that almost half of Verizon is owned by a company overseas.

That could soon change. Vodafone, the British telecommunications giant, has confirmed that it is in talks to sell to Verizon Communications its 45 percent stake in Verizon Wireless, a deal that analysts say could be worth at least $125 billion.

For Verizon, this has been a long-sought deal, one that would rank among the biggest purchases in history. With complete ownership of its wireless business, the company would be able to shift from receiving dividends to being able to fully incorporate all of its profit. And it will have full control over what it does with that profit, especially as advertisers, content distributors and wireless carriers increasingly use smartphones, mobile data and information services.

In theory, having complete ownership of the wireless venture would allow Verizon to integrate its businesses more tightly, which might lead to better deals on bundles with wireline and wireless products.

At least in the short term, Verizon customers would be unlikely to see much difference in their service. “The impact from a consumer perspective will be negligible,” said Jan Dawson, a telecom analyst for Ovum.

But it is clear why Verizon would want complete ownership of its wireless division. The lucrative wireless industry, already worth $1.6 trillion, is expected to become a multitrillion-dollar market in the next decade, said Chetan Sharma, an independent telecom analyst who does consulting for carriers.

With 10 billion connections worldwide, the number of cellular subscriptions is on track to outgrow the human population. That is because in addition to cellphones, many other devices, like tablets, video game devices and even home security systems, are now all relying on cell towers to deliver information, entertainment and media to consumers.

Verizon is still the No. 1 cellphone carrier in the United States by market share, but it faces formidable competition from AT&T, the No. 2 carrier. The smaller carriers, Sprint and T-Mobile USA, offer lower-cost phone and data plans to try to compete, but to little avail â€" AT&T and Verizon still account for two-thirds of overall subscribers.

Verizon’s core strategy has been to invest more in network infrastructure to attract customers with the best technology. For instance, it is leading the industrywide race in building a faster fourth-generation wireless network, called LTE. Verizon has LTE covering 500 markets; AT&T has LTE in about 370 markets.

Verizon, one of the last so-called Baby Bells that trace their origins to the breakup of AT&T, has banked on wireless as a central part of its future. Today, a majority of Verizon’s revenue comes from its wireless business. In the second quarter this year, Verizon Wireless brought in $20 billion of Verizon’s total $29.8 billion in revenue.

For the most part, Vodafone has been an unseen partner all these years, happily taking in its cut of the profits via the dividend that its 45 percent stake in the wireless venture has provided. The relationship is one that dates back to the telecom mergers in the 1990s. Bell Atlantic had merged with GTE to become Verizon Communications. Vodafone had acquired AirTouch, an American wireless company. Verizon merged its wireless business with Vodafone’s acquired assets of AirTouch so that combined, they could become a bigger player.

For years, there was speculation that Vodafone would want to get out of the business so it could concentrate on its European operations, but the right price and tax implications of any deal had always held up any definitive agreement.

This year, however, Verizon said it could structure any potential transaction to limit Vodafone’s tax liabilities. Despite speculation this year about a potential deal, no acquisition for Verizon Wireless materialized, and Verizon said in April that it did not have plans to merge or make an offer for all of Vodafone.

Analysts said any prospective deal now would likely involve a cash-and-stock offer that would give Vodafone roughly a 30 percent stake in Verizon.

Vodafone’s chief executive, Vittorio Colao, has previously said that he was open to selling the holding in Verizon Wireless, though the company confirmed only on Thursday that it was in talks about a potential deal. A final deal could be announced as early next week, according to a person with knowledge of the matter, who spoke on the condition of anonymity.

If Verizon and Vodafone were to reach an agreement, each company would have to take on a different outlook for the American phone business, said Craig Moffett, an analyst for Moffett Research.

To justify the billions it would have to pay, Verizon would have to be confident that the growth of Verizon Wireless would remain strong, he said. By contrast, Vodafone would have to believe that the American wireless business is stagnating and that Verizon Wireless cannot grow much more.

“For investors, the pertinent question is therefore: Which outlook do you believe?” Mr. Moffett said in a research note.

At least initially, investors seemed to support the news of the talks. Shares in Vodafone closed up 8 percent in trading in London on Thursday. Its stock price, however, has fallen around 40 percent since the Verizon Wireless partnership was established in 1999.

Verizon’s shareholders, too, seemed enthusiastic about the prospect of a deal. Its shares were up about 2.7 percent, even though it would have to pay, and borrow, billions, to make the purchase happen.

A Vodafone spokesman declined to comment further. A representative for Verizon was not immediately available for comment.

The potential deal would be one of the biggest in the last two decades, trailing only Vodafone’s $202.8 billion takeover of the German cellphone operator Mannesmann in 2000 and the $181.6 billion merger of AOL and Time Warner in 2001, according to Thomson Reuters. (Both figures include the assumption of debt.) And between fees for advising the two companies and for lending money to support the deal, a transaction would be a bonanza for advisers to Verizon and Vodafone.

For Vodafone, the world’s second-largest cellphone operator behind China Mobile, an influx of cash would let it strengthen its core European operations, which have struggled because of the Continent’s financial woes. It would also allow Vodafone’s investors to benefit through share buybacks.

“Vodafone investors are expecting a fairly material payout,” said Paul Marsch, an analyst at Berenberg Bank in London. “They have been waiting for a very long time.”

The healthy earnings at Verizon Wireless stand in contrast to those of Vodafone, which has experienced anemic growth in Europe.

Vodafone reported a 3.5 percent fall, to $15.7 billion, in its so-called joint service revenue â€" a measure of its continuing services that does not include handset sales â€" in the three months that ended June 30.

The decline was the fourth consecutive quarterly drop in revenue, and highlighted persisting weaknesses in the company’s crucial German and British markets.

“Vodafone faces a strategic challenge in its European business,” said Mr. Marsch of Berenberg Bank. By selling its stake in Verizon Wireless, Vodafone could receive a large war chest to finance potential acquisitions and renewed investment in so-called fourth-generation wireless networks.

Vodafone remains either the No. 1 or No. 2 operator in eight of its nine Western European markets, but it is facing increased competition from cable companies like John C. Malone’s Liberty Global, which are offering bundled service packages that include high-speed broadband and telephone services.

Despite its strong market share in mobile phone offerings, analysts say Vodafone needs to improve its operations, particularly in cable, to defend against the ramped-up investment plans of its rivals.

“Vodafone needs to improve its bundled services for its customers,” said Gyanee Dewnarain, a research director at the analyst firm Gartner in London. “People are looking for more value for their money.”

Michael J. de la Merced contributed reporting.

A version of this article appears in print on 08/30/2013, on page B1 of the NewYork edition with the headline: Verizon Seeks Rest of Its Wireless Unit.