What does the FBI want?
The FBI is still investigating the San Bernardino shooting that killed 14 people. Federal agents are trying to determine if there are any more ISIS-inspired terrorists plots underway.
On Tuesday, a federal magistrate-judge ruled that Apple must help the FBI break into the locked iPhone 5C of the dead shooter, Syed Farook. Apple was ordered to create a weaker version of its operating system for this one device, and help the FBI crack Farook’s passcode.
Why is Apple fighting the FBI?
Apple says complying with the FBI would undermine Apple’s brand and hurt its profitability.
If Apple complies with the judge’s order, it will be forced to build software that “would have the potential to unlock any iPhone in someone’s physical possession,” Apple CEO Tim Cook said in a public letter to customers.
Apple has become the most valuable company in the world partly because it builds products that are extremely secure. Apple promises that if customer follows basic directions, the photos and messages on an iPhone are safe and private.
That promise is broken if Apple abides by the magistrate-judge’s order.
Does Apple even have a choice?
It can appeal the decision.
Tuesday’s order was written by U.S. Magistrate Judge Sheri Pym. She’s not an actual U.S. district judge, so Apple could object to her order and take it to the federal judge overseeing the case.
At this point, Apple can only argue that this order is “burdensome.” But corporate defense lawyers told CNNMoney they doubt that’ll fly.
(The FBI is trying to prevent another terrorist attack. The judge isn’t likely to care that Apple needs to have its engineers work overtime.)
If that doesn’t work, Apple can then appeal to the federal judicial system’s Ninth Circuit. It could even take this all the way up the U.S. Supreme Court.
To postpone judicial orders, Apple can claim this will “cause irreparable harm” to the company.
But even in mid-appeal, Apple could still be told: Do it now.
What if Apple still says no?
Then it gets ugly.
If Apple refuses a court order — even one that hurts the company — it can be held in contempt of court.
The U.S. government could fine the company for every day it doesn’t comply. Apple has close to $200 billion in cash lying around, so it has lots of money to burn on this fight.
But a federal judge could instead send a top Apple executive behind bars — in theory.
There are many examples of people held in contempt of court. Last year, a federal judge put Rowan County, Kentucky clerk Kim Davis in jail for five days when she refused to issue marriage licenses to gay couples. In 2005, a federal judge put a New York Times journalist Judith Miller in prison for 85 days after she refused to give up the name of her confidential source at the White House.
But this is different. The court would be holding a corporation in contempt, and in the United States, corporations are individual entities all on their own. CNNMoney spoke to seven corporate lawyers. All but one said executives could get sent to jail if their companies are held in contempt.
But none of them can point to a single case where that has happened.
“Unlike a closely-held company, where you could go after the CEO, Apple is a publicly traded company,” said Miami federal defense attorney David Oscar Markus. “But no one is going to jail over this.”
Will Tim Cook go to jail?
That’s unlikely. But it’s possible.
“The person who goes to jail is the one who makes the decision not to comply,” said Frank Rubino, a federal defense attorney in Miami, Florida.
That could be Cook. Or it could be some top engineer.
Why does this case matter so much?
This is a landmark case. It will establish a precedent that asserts new powers for law enforcement.
Kendall Coffey, formerly the top federal prosecutor in Miami, noted that it’s rare for a major company to pick such a huge legal battle.
“What’s striking about this scenario is the opposition in the face of a court order,” Coffey said. “It signals it’s going to be a big fight. A lot of companies don’t want to be on the wrong side of the FBI. Their jurisdiction is broad, and it can be akin to tugging on Superman’s cape.”