US Sues Sprint For Overbilling For Surveillance Services

Monday, the Obama administration filed a lawsuit in a district
court, claiming Sprint knowingly charged $21 million extra in
spying fees between 2007 and 2010.

Sprint, the telecommunications provider, complied with court
orders to wiretap for the FBI, Drug Enforcement Administration
(DEA), Bureau of Alcohol, and other government agencies. It charged
the U.S. government reimbursement fees for the costs of complying
with wiretaps and intercepts.

But the government finds fault with this. The U.S. points to the
Communications Assistance in Law Enforcement Act (CALEA), a law
that makes wiretapping more manageable for law
enforcement agencies. Associated Press
explains:

In 1994, lawmakers passed a law requiring communication
companies to upgrade their equipment and facilities to ensure they
can comply with court orders seeking wiretaps of their
customers. 

Section 103 of the law says that carriers are “prohibited from
using their intercept charges to recover the costs of modifying
equipment, facilities or services that were incurred,” U.S.
attorneys wrote in the
complaint. But Sprint did charge for these services, and it led to
a 58 percent hike in expenses for the federal government.

The Electric Frontier Foundation, in a FAQ disputing the law,
argued that
demanding telecommunication companies pick up the tab for
government’s surveillance expenses is unreasonable. Added costs for
the carrier are most likely passed on to the consumer. “Quite
literally,” it reads, “consumers would be subsidizing the
surveillance state.”

Regardless, Sprint thinks that the law rolls in its favor and
that the government must pony up for the added expenses incurred.
Sprint
issued a statement to Ars Technica:

Under the law, the government is required to reimburse Sprint
for its reasonable costs incurred when assisting law enforcement
agencies with electronic surveillance. The invoices Sprint has
submitted to the government fully comply with the law.

The U.S. seeks $63 million, or triple the costs incurred, if
Sprint is found guilty.

The telecommunications company will
challenge the lawsuit, “We have fully cooperated with this
investigation and intend to defend this matter vigorously.”