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microsoftResponding to criticism of its investigation into an alleged leak of company trade secrets, Microsoft acknowledged overnight that it searched a Hotmail customer’s Microsoft accounts without a court order — but described the action as “extraordinary” and announced that it will add a new layer of outside review when it encounters similar situations in the future.

The post from Microsoft deputy general counsel John Frank, released Thursday evening, follows the news this week that a former Microsoft employee was arrested on allegations that he leaked Windows trade secrets to a blogger. That blogger’s Microsoft accounts were reviewed by Microsoft’s investigators as part of the company’s internal inquiry, according to a complaint filed in federal court.

It’s a hot-button issue for Microsoft, which has taken a hard stand on revelations of government surveillance, and lampooned Google for delivering ads based on the contents of customers’ email messages. Frank opens his post by saying, “We believe that Outlook and Hotmail email are and should be private.”

In this case, however, Microsoft says its actions were justified based on the circumstances.

“The investigation repeatedly identified clear evidence that the third party involved intended to sell Microsoft IP and had done so in the past,” writes Microsoft’s Frank in the company’s post.

He continues, “Courts do not, however, issue orders authorizing someone to search themselves, since obviously no such order is needed. So even when we believe we have probable cause, there’s not an applicable court process for an investigation such as this one relating to the information stored on servers located on our own premises.”

The company says it will only conduct a search of customer email if it believes “the circumstances would justify a court order, if one were available.” In the case of the alleged Windows leaker, this determination was made by a Microsoft legal team separate from the one investigating the case, but in the future the company will go further, seeking additional outside review.

Frank writes, “As a new and additional step, we will then submit this evidence to an outside attorney who is a former federal judge. We will conduct such a search only if this former judge similarly concludes that there is evidence sufficient for a court order.”

The company says it will also publish the number of these types of searches that it conducts as part of its “transparency reports.”

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