US threatened massive fine to force Yahoo to release data

The US government threatened to fine Yahoo $250,000 a day in 2008 if it failed to comply with a broad demand to hand over user data that the company believed was unconstitutional, according to court documents that illuminate how federal officials forced American tech companies to participate in the National Security Agency’s controversial PRISM program.

The documents, roughly 1,500 pages worth, outline a secret and ultimately unsuccessful legal battle by Yahoo to resist the government’s demands. The company’s loss required Yahoo to become one of the first to begin providing information to PRISM, a program that gave the National Security Agency extensive access to records of online communications by users of Yahoo and other US-based technology firms. The ruling by the Foreign Intelligence Surveillance Court of Review became a key -- but almost entirely secret -- moment in the development of PRISM, helping government officials to convince other Silicon Valley companies that unprecedented data demands had been tested in the courts and found constitutionally sound.