Following 9/11, the government asked telecom giants for access to their networks in order to gather intelligence on suspected terrorists. When the ACLU and other groups filed suit against them for violating their customer's privacy, congress passed a bill granting the companies immunity.

Yesterday, the 9th circuit court upheld the immunity. Business Week:

The plaintiffs, represented by lawyers including the San Francisco-based Electronic Frontier Foundation and the American Civil Liberties Union, accuse the companies of violating the law and the privacy of its customers by collaborating with NSA on intelligence gathering.

The case stems from new surveillance rules passed by Congress in 2009 that included protection from legal liability for telecommunications companies that allegedly helped the U.S. spy on Americans without warrants.

"I'm very disappointed. I think the court reaches to try to put lipstick on a pig here," said Cindy Cohn, legal director of the Electronic Frontier Foundation, who argued the case before the panel. "I think what Congress did was an abdication of its duty to protect people from illegal surveillance."

In its ruling, the court noted comments made by the Senate Select Committee on Intelligence regarding the legal immunity's role in helping the government gather intelligence.

"It emphasized that electronic intelligence gathering depends in great part on cooperation from private companies ... and that if litigation were allowed to proceed against persons allegedly assisting in such activities, `the private sector might be unwilling to cooperate with lawful government requests in the future,'" Judge M. Margaret McKeown.

The government does hold a pretty big stick over the heads of these companies through the regulatory process so there was a legitimate question whether the corporations involved had much of a choice in the matter. Still, it didn't seem right penalizing corporations for their cooperation during a time of danger to the republic and given the dampening effect such suits may have in the future on cooperation from the private sector, the court handed down a logical and reasonable result.