Lavabit: U.S. government overreach may drive U.S. companies offshore

“Another amicus brief has been filed in support of Apple in its legal battle with the FBI over the measures it is being ordered, by a court writ, to take to help the agency break into a locked iPhone used by one of the San Bernardino terrorists,” Natasha Lomas reports for TechCrunch. “Apple is keeping an update[d] list of amicus briefs and letters of support filed with the court here.”

“This time the amicus brief has been submitted by Lavabit, a technology company that previously judged it necessary to shutter its own service after receiving similarly ‘extraordinary’ government demands for assistance to access user data, in the wake of the 2013 disclosures by NSA whistleblower Edward Snowden,” Lomas reports. “The former encrypted email service had apparently been used by Snowden for private email communications but shut down its services in August 2013 to avoid being forced to compromise user data, with founder Ladar Levison saying at the time: ‘I would _strongly_ recommend against anyone trusting their private data to a company with physical ties to the United States.'”

“In its amicus brief in support of Apple, published on Friday,” Lomas reports, “Lavabit also warns the FBI’s action against Apple could ultimately trigger an exodus of US companies seeking to avoid similar reputational damage. ‘Such precedence would likely result in many businesses moving their operations offshore, therefore, making it more difficult for law enforcement to obtain even ordinary assistance from such companies,’ it writes in the brief.”

Read more in the full article here.

MacDailyNews Take: Wouldn’t it be cool if Apple purchased an island from some debt-ridden country (plenty of those to choose from) and turned it into their own tax-free nation or at least moved to a country that respected privacy rights and had a sane level of taxation, at least? Of course, things could always change with the latter move, but with the admittedly fantastical and impractical former move, Apple would be truly free of an increasingly hostile U.S. government.

Lavabit’s full amicus brief – recommended – is here.

19 Comments

  1. I’ve been saying Apple could do this since I first heard of this case. What’s to stop them from moving entirely to Ireland, et al? If the government keeps pushing the most powerful companies in the world the wrong way like this, the entire country will be like Detroit.

    1. You are mixing metaphors.

      I have relatives who live in Detroit. I am not sure exactly where you’re going with your offhand comment, but I’ve gotta stand up for that tough city.

      Detroit is a city that has suffered for decades from corruption in city government. Corruption in industry and labor unions. Apathy on the part of civic leaders and the business community. Short-sighted planning and festering racial tension brought about by good people defending bad actors who played the race card when caught for crimes. (The 1968 race riot saw black rioters burn down black businesses). And that’s all you ever read about Detroit, even today.

      In 2009, the federal government stepped in and offered corporate welfare in order to prevent collapse of the auto industry, which is nationwide, not just near Detroit. Ford took government underwriting just like GM and even foreign automakers with plants all across the USA. Like it or not, the auto industry was kept from implosion in the USA and thankfully we have the choice today to buy from several automakers, not just boring products from Toyota and Hyundai.

      Since those dark days, the UAW and its workers have taken pay cuts; white collar workers have taken even greater pay cuts, appropriately. Renewal of business and increased entrepreneurism is having positive effect, and diversifying the economy. Hometown biggies Ford and GM finally got the wake-up call they needed and are pumping out award-winning products. Auto journalists like Motor Trend are ranking Cadillac models ahead of the likes of Lexus and Audi. http://www.motortrend.com/news/comparison-audi-s6-4-0t-quattro-vs-cadillac-cts-v-sport-vs-lexus-gs-f/

      The Chevy Colorado wins truck of the year awards while the new Toyota Tacoma is blown out of the water in competitive reviews.

      This rust belt city is not dead. Far from it. It’s digging itself out from the hole that past corruption caused it. That takes time and a hell of a lot of energy. But the opportunities are enormous — the Detroit metro region still has an awesome location, skilled workers, and world class universities. It is puzzling to me why a company like Apple doesn’t invest in manufacturing in cities like Detroit. If there was a city with competitive advantages for innovative new companies, this is it.

      One last thought: while the formerly smooth and seamless Motown culture of Detroit from a generation ago has sadly given way to popular rough-edged grunge image epitomized by Iggy Pop, Kid Rock, or Jack White, the reality is that Detroit is neither. Neither popular culture nor economic statistics accurately portray what Detroit is like. Detroit is the canary in the American coal mine: former industrial might and wealth undermined by short-sighted outsourcing and evisceration of the middle class. Detroit today has the smallest middle class it’s had in 100 years, thanks to bad corporate leadership and corrupt unions that bit the hand that fed them. So now the beaten-down middle class of Detroit is rising up and taking back their city.

      That’s more than can be said for many cities across America. It doesn’t take a genius to know that as soon as the rest of America’s middle class is eliminated, then the rest of America’s formerly great cities will rust as Detroit did for many years. The solution is for the money holders, the banks and entrepreneurs, to launch new businesses in America instead of China. America will never be prosperous again if all wealth gains on paper come from real estate speculation instead of honest hard work creating and manufacturing things so that everyone has the opportunity to earn a good job, no matter where they started. Today’s rigged economy in the USA is like an Easter egg hunt where the biggest strongest kids get all the eggs and the rules for who keeps the eggs are written by the parents of the bullies. You’ve got leaders in coastal cities trying as hard as they can to price families out of their cities, inflating huge bubbles in real estate values again to accelerate property tax revenues, all the while the homeless encampments and drug epidemics spread. The gap between haves and have-nots widens.

      If you’ve never been to Detroit, you owe it to yourself to reject the over-hyped bad press. Visit and you won’t regret it.

    1. They would find links to their own three white, athletically built, camoed men who did the shooting. They don’t want anybody to find them out. They will destroy the evidence found on the phone, as they already tried to do by instructing the local government personnel to change the password on the phone. Ooops! Another false flag activity unveiled.

    1. Burger King moved to Canada? I wasn’t aware of that. They recently bought our favour coffee chain (Tim Hortons), which makes me very sad, but if BK HQ is based in Canada, then that makes me feel a bit better. I’m so tired of our Canadian profits going across the border to the US! 🙂

    2. UH, WRONG. Burger King HQ is in Miami Florida, they originated in Jacksonville Florida.

      They recently bought Canadian chain Hortons’s, but they also announced as part of the acquisition that both companies would retain their corporate offices where they were. IE Burger King Stayed in Miami.

  2. The secret strategy:

    Keep all the self-destructive, corrupt, corporate welfare requiring companies in the USA. Boot out all the quality companies because all the lousy companies demand it. The result of course is a USA that emulates all the shite companies in the USA, just as worthless, parasitic and moribund as the companies that manipulate the government.

    Great strategy. Call in the morticians. 📉 ⛪ 🇷🇮🇵 💀

  3. Looks like the idea has finally hit the mainstream media and gauging from how Apple’s appeal with the e-book case went the idea is looking more and more appealing.

    Derek better check that might be an overseas call for those morticians.

    1. Where is the engine for that glass “Spaceship Apple”? Or did they develop the transporter to move more than one water molecule already?

  4. So, I watched the Democratic debate last night. Clinton wants to charge companies an exit fee and back taxes for any recent tax breaks given if the companies leave the U.S. This is a global economy now and the U.S. has some of the highest corporate taxes in the world. How are these companies suppose to compete when the U.S. dollar and U.S. taxes are at screaming high levels?

    The other candidate, Sanders, wants a $0.50 tax on every $100 traded on the stock market. I believe this tax covers all trades, not just high frequency. This would dry up liquidity and crash the market, which would then crash the economy. I recommend all Sanders followers watch the movie “Too Big to Fail” on HBO. You will need to hunt squirrel for food after the economy collapse.

    Trump wants a 35% tax on all imported goods. This would probably raise prices on most products by 50%. So, again, this is not good for the economy.

    Now the goverment is demanding companies build them products. If these companies refuse then the officers of these corporations face jail time. Will the entire company be banned from doing business if they refuse? Is the goverment going to compensate me when my stake in these companies is greatly reduced?

    Is there anyone in goverment right now that doesn’t have their head up their ass?

    1. Oh No! A whole 50 cents per trade order! Run for the hills!

      Do you even have a clue how much your broker is charging you per trade? It costs him fractions of a penny.

      It’s absolute BS to suggest that Wall Street would be negatively affected by a rational incentive to stop volatile hypertrading. A small tax per trade as Sanders proposes is the only rational suggestion I’ve heard from any candidate thus far.

    2. A small charge levied on stock market trades would go some way towards addressing the problems with AAPL being manipulated so aggressively. At the moment, a company can trade a million dollars, wait for a few minutes and sell again when there is a tiny percentage change on the stock value. If there was a $5,000 tax on that million dollar trade ( or $10,000 if the tax if levied on both the purchase and the sale ) they would have to leave the money in that stock until there was a more substantial difference. It would discourage speculators who make short term trades, but only have a marginal effect on investors who invest money for the longer term.

      It would be essential that any such legislation applied to practices like short trading as well as conventional share trading, otherwise it would not have any beneficial effect and would make the existing system even worse.

  5. “MacDailyNews Take: Wouldn’t it be cool if Apple purchased an island from some debt-ridden country (plenty of those to choose from) and turned it into their own tax-free nation or at least moved to a country that respected privacy rights and had a sane level of taxation, at least? Of course, things could always change with the latter move, but with the admittedly fantastical and impractical former move, Apple would be truly free of an increasingly hostile U.S. government.”
    Sooner or later, this will become the only option for Apple.

Add Your Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.