House rejects immunity for phone companies in spy suits: The U.S. House of Representatives has voted to permit lawsuits that allege the illicit cooperation of telephone and Internet companies with government spy programs.

By a 227-189 vote largely along party lines on Thursday night, politicians approved the Democrat-backed Restore Act. The action, however, promptly renewed veto vows from the White House, which said the proposal "would dangerously weaken our ability to protect the nation from foreign threats."

Congressional Democrats who endorsed the bill disagreed. "Today's bill helps restore the balance between security and liberty," House Intelligence Committee Chairman Silvestre Reyes, a Texas Democrat, said in a statement after the vote.

The legislation is partially an outgrowth of still-unresolved allegations that U.S. telecommunications companies provided assistance to the National Security Agency's surveillance programs in violation of federal laws since--and possibly even before--the September 11, 2001, terror attacks. The Bush administration has requested that Congress approve legislation granting retroactive legal immunity to any telecommunications company that aided government spying.

Democratic leaders deny that their bill will make it harder to spy on foreign terrorists, but Republican leaders claim that the bill contains enough loopholes to require a warrant for eavesdropping on Osama bin Laden and other foreign terrorists.

"The bill gives terrorists overseas more rights under the law, than individuals inside the U.S.," said Rep. Lamar Smith (R-Texas), a ranking member of the House Judiciary Committee. "That is simply absurd."

Supporters of the House bill say it allows intelligence agents to continue to snoop on foreigners without a warrant and to obtain "basket warrants" for surveilling foreign terrorist organizations.

At the same time, supporters say, the bill will provide additional safeguards for Americans' privacy and more oversight over the shadowy court that's charged with approving eavesdropping requests when one end of the communications belongs to a U.S. person.

The legislation is part of an update to the 1978 Foreign Intelligence Surveillance Act, or FISA, that the Bush administration argues is necessary to make intelligence gathering more efficient amid changing technologies.

Now focus will shift to the Senate, where a new battle over the immunity issue is likely to heat up soon.

The House vote arrived just hours after the Senate Judiciary Committee approved its own spy law rewrite but punted on the issue of whether to approve retroactive immunity for companies with access to electronic communications.

The Senate Intelligence Committee has already approved a different version of that legislation, containing a sweeping provision that would crush all pending lawsuits alleging illegal spying by companies like AT&T and Verizon Communications, as well as any future suits or state utility commission investigations.

The White House has already made it clear it vastly prefers the Senate Intelligence Committee version, but critics say that one gives the executive branch too much unchecked authority to eavesdrop, without a court order, on communications between Americans and people "reasonably believed to be outside the United States."

(Read Original Article - Via Privacy : Tech news from CNET .)