Not only that, but the idea that a US person or company can dodge a court order just by transferring the data in question (or a physical object such as a server, or an item of disputed ownership) to another country seems totally unsupportable. I don't see how the judge has erred by issuing this order and expecting it to be followed.
As I see it, the judge had no choice but to issue the order, and Microsoft has no rational alternative but to defy it if they want to conduct business as an international provider of cloud services. The real problem is with Congress, not the courts. When they permitted intelligence agencies to run amok with absolutely no Constitutional boundaries, they thought very little about the long term consequences and cared even less.
Except that a customer of Microsoft Ireland purchased cloud based storage in the EU. Now the US is claiming that Microsoft USA should retrieve the data from Microsoft Ireland because Microsoft USA is the controlling entity.
The data was never in the US of A to begin with, and if Microsoft USA forces Microsoft Ireland to retrieve the file Microsoft USA can kiss their entire cloud offering Goodbye in Europe since no-one will use them because the data could potentially be accessed by the US government with no regard for EU laws.
> When they permitted intelligence agencies to run amok [...] they thought very little about the long term consequences
I don't think intelligence agencies are involved here at all. In fact, them "running amok" would be easier in this case: they would have those emails already, process be damned.
In truth, this particular process would have happened at one point or another regardless of intelligence services, it's just a function of global internet services existing and laws having emerged to deal with them. Back before EU privacy laws were introduced, Microsoft would have just handed out anything they had to the FBI without really a second thought. Now they have to comply with two conflicting sets of laws.
It's not just a problem with the US Congress: it's a transatlantic (or rather global) conflict between incompatible laws.
It's like France had a law prohibiting a company from selling widgets at price X worldwide, and the US had a law forcing them to sell the same widgets at price X worldwide: you just couldn't obey both laws, since they both claim the same jurisdiction while mandating conflicting behaviour. You would need an international treaty to harmonize this, or one country to drop their law.
The involvement of intelligence agencies is indirect but very much relevant. Widespread disclosure of illegal domestic spying, including misuse of intelligence data for commercial purposes, incentivizes customers to keep their data out of the US. As a result, companies like Microsoft need to be prepared to maintain customer data outside the US, or they won't be able to compete with providers in other countries.
I'm not convinced it matters. Should Microsoft Ireland be allowed to print their own US currency, for example, as long as they never bring any of it into the US?
As I see it, the judge had no choice but to issue the order, and Microsoft has no rational alternative but to defy it if they want to conduct business as an international provider of cloud services. The real problem is with Congress, not the courts. When they permitted intelligence agencies to run amok with absolutely no Constitutional boundaries, they thought very little about the long term consequences and cared even less.