Internet firm owner tells of chagrin at FBI security letter

Friends mentioned the case when it was in the news, and the normally outspoken Merrill would change the subject.

He heard the arguments at the federal courthouse, and in an out-of-body moment he realized that no one knew he was the plaintiff challenging the FBI’s authority to issue national security letters, as they are known, and its ability to impose a gag on the recipient.

Now, after the partial lifting of his gag order last month as a result of an FBI settlement, Merrill, 37, can speak openly for the first time about the experience, although he cannot disclose the full scope of the data demanded.

“I’m having a hard time adjusting,’’ the Manhattan native said. “I’ve spent so much time never talking about it. It’s a weird feeling.’’

Civil liberties advocates hope that Merrill’s case will inspire others who have received the FBI’s letters to come forward and inform the public debate on the proper scope of the government’s ability to demand private data from Internet and other companies for counterterrorism and intelligence investigations.

“One of the most dangerous and troubling things about the FBI’s national security letter powers is how much it has been shrouded in secrecy,’’ said Melissa Goodman, a lawyer with the American Civil Liberties Union who helped Merrill sue the government in April 2004.

The government has long contended, as it did in this case, that “secrecy is often essential to the successful conduct of counterterrorism and counterintelligence investigations’’ and that public disclosure of the receipt of a letter “may pose serious risks.’’ “The FBI needs the ability to protect investigations, sources, and methods,’’ said Mike Kortan, an FBI spokesman.

The recent request by the Obama administration to amend the law governing the demands for data has prompted debate in Congress over which types of electronic records should require a judge’s permission before the FBI can seek them and which types should not, as is the case with national security letters. A letter can be issued by any FBI field office supervisor.

The FBI issued more than 192,500 letters, an average of almost 50,000 a year, between 2003 and 2006. The Justice Department inspector general faulted the bureau in 2007 for failing to adequately justify the issuance of such letters, though progress has been made in cleaning up the process.

On a cold February day in 2004, an FBI agent pulled an envelope out of his trench coat and handed it to Merrill, who ran an Internet startup called Calyx in New York. Like most Americans, he had no idea what a national security letter was.

The letter requested that Merrill provide 16 categories of “electronic communication transactional records,’’ including e-mail address, account number, and billing information. Most of the other categories remain redacted by the FBI.

Two things, he said, “just leaped out at me.’’ The first was the letter’s prohibition against disclosure. The second was the absence of a judge’s signature.

“It seemed to be acting like a search warrant, but it wasn’t a search warrant signed by a judge,’’ said Merrill. He said it seemed to violate the constitutional ban against unreasonable searches and seizures.

The letter said that the information was sought for an investigation against international terrorism or clandestine intelligence activities.

Merrill said he thought it “outlandish’’ that any of his clients, many of whom were ad agencies and major companies, as well as human-rights and other nonprofit groups, would be investigated for terrorism or espionage.

“I wouldn’t want the FBI to demand stuff like that about me without a warrant,’’ Merrill said.