Deputy Solicitor General Gregory Garre, representing the government, argued that letting the case go to trial, "would reveal the sources, methods and operational details" of government intelligence activities. The alleged monitoring is part of more rigorous surveillance practices put in motion after the terrorist attacks of 11 September, 2001.
After a two-and-a-half hour hearing, the US Court of Appeals for the 9th District, in San Francisco, said it will consider the dismissal motion as well as a one in a second lawsuit also challenging the NSA programme.
But Appeals Court judges Michael Daly Hawkins, Margaret McKeown and Harry Pregerson, peppered Garre with questions, challenging his argument that the state secrets privilege trumps the right of the plaintiffs to have their case heard.
Pregerson asked Garre how a court is to decide whether something the executive branch claims is a state secret is a secret, if the executive branch won't reveal what it claims is a secret.
"Who decides what's a state secret? Are we just a rubber stamp? We're just supposed to take the word of the executive?" Pregerson asked.
Garre responded that the court should give "the utmost deference" to the executive branch's claim that something is a state secret, but acknowledged that it is not an "absolute deference".
The EFF says that AT&T, at one of its offices in San Francisco, diverted internet traffic, including emails and Voice over IP (VoIP) phone calls, to a separate room in which NSA-authorised people monitored the network traffic. Robert Fram the attorney for EFF, said that just the act of diverting that traffic into a room controlled by the NSA proved their case against AT&T and that they would not have to try to risk violating the state secrets privilege by trying to disclose what was done with the information.
But Garre, in rebuttal, argued that if the surveillance done in that room was approved by a warrant, then there is no violation by the government or AT&T in diverting internet traffic to that surveillance room.
The second case is that of the Al-Haramain Islamic Foundation versus President George W. Bush, which claims the government engaged in warrantless surveillance of their organisation, in violation of its constitutional rights.
The appeals judges gave no indication when they might rule on the motion to dismiss. Lee Tien, an EFF staff attorney, said given the notoriety of the case, the judges could render a decision soon, but at the same time, given the gravity of the issues, they might take more time.