Ninth Circuit Court of Appeals Finds That the Export Administration Regulations as Applied to the Export of Encryption Technology Runs Afoul of the 1st Amendment

January 1, 2003

On May 6, 1999, the Ninth Circuit of Appeals, in a 2-1 decision, affirmed the district court's finding in Bernstein v. United States, 974 F. Supp. 1288 (1997), that the Export Administration Regulations constitute an invalid prior restraint on speech as applied to the export of encryption technology. The Ninth Circuit endorsed the declaratory relief granted by the district court, which stated as follows:

The Export Administration Regulations, 15 C.F.R. pt. 730 et seq. (1997) and all rules, policies and practices promulgated or pursued thereunder insofar as they apply to or require licensing for encryption and decryption software and related devices and technology are in violation of the First Amendment on the grounds of prior restraint and are, therefore, unconstitutional . . . .

Daniel Bernstein is a professor at the University of Illinois at Chicago in the Department of Mathematics, Statistics and Computer Science. While working towards his Ph.D at the University of California, Berkeley, Bernstein created a zero-delay private-key encryption system, entitled "Snuffle." He developed a source code for encryption and decryption, which he called "Snuffle 5.0." He described the encryption system in an academic paper in English entitled "The Snuffle Encryption System," and later wrote a set of instructions in English explaining how to use the Snuffle system. Professor Bernstein sought to present the Snuffle system to members of the academic and scientific communities, and submitted a commodity jurisdiction request to the State Department to determine whether he needed a license to publish the paper, the instructions, and the Snuffle 5.0 source code. The State Department determined that the Snuffle 5.0 source code and the instructions were munitions under the International Traffic in Arms Regulations ("ITAR"), and that a license was required for exportation.

Bernstein filed suit in the District Court for the Northern District of California challenging the constitutionality of the ITAR, and asserting that his first amendments rights had been violated as he was not permitted to teach Snuffle, publicly present the system at conferences, or publish it in journals or on the internet without a license. (It should be noted that in 1996, President Clinton transferred licensing authority for nonmilitary encryption articles and technology from the State Department to the Department of Commerce. Subsequently, Bernstein amended his complaint to add the Department of Commerce as a defendant. Bernstein relied on the same arguments in challenging the control of encryption technology under the Export Administration Regulations) The District Court granted summary judgment in favor of Bernstein, holding that the EAR constituted an invalid prior restraint on speech. See Bernstein v. Department of State, 974 F. Supp. 1288 (N.D. Cal. 1997). The District Court enjoined the Commerce of Department from enforcing Parts 730-734 of the EAR; however, this injunction was stayed pending the government's appeal.

On appeal, the Ninth Circuit ultimately determined that the EAR restrictions on the export of encryption software in source code form violates the First Amendment. In so finding, the court first held that the Bernstein was entitled to bring a facial challenge against the EAR. Quoting the language in Lakewood v. Plain Dealer Publishing Co., 486 U.S. 750, 759 (1988), the court stated that a licensing regime is subject to a facial challenge as a prior restraint where it-


gives a government official or agency substantial power to discriminate based on the content or viewpoint of speech, . . . [and where it has] a close enough nexus to expression, or to conduct commonly associated with expression, to pose a real and substantial threat of censorship risks.

As applied to the facts in Bernstein, the court noted that the BXA is granted the broad and unbridled authority to deny licenses for exports which may not be consistent with US national security and foreign policy. Thus, the Ninth Circuit easily found that the first condition for initiating a facial challenge- that the government entity possesses substantial power to discriminate against varying forms of speech- were satisfied. In addition, the court found that the encryption source code constituted expression for First Amendment purposes. The court likened the cryptographer's use of source code to express scientific ideas to the mathematician's use of equations. The court concluded that--

encryption software, in its source code form and as employed by those in the field of cryptography, must be viewed as expressive for First Amendment purposes, and thus is entitled to the protections of the prior restraint doctrine. If the government required that mathematicians obtain a prepublication license prior to publishing material that included mathematical equations, we have no doubt that such a regime would be subject to scrutiny as a prior restraint.